UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period ended October 31, 20182019

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _____________

Commission file number: 000-55690

MIRAGE ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

(210) 858-3970 

(Issuer’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 issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 at least the past 90 days. Yes x 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 (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). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange:

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act.) Yes ¨ No x

Securities registered pursuant to Section 12(b) of the Act: None 

Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: February 11, 2019May 5, 2020 there were 359,320,042428,806,640 shares of the Company’s common stock were issued and outstanding.

MIRAGE ENERGY CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 20182019

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s 10-K for the year ending July 31, 20182019 filed with the Securities and Exchange Commission. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year ending July 31, 2019.2020.

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MIRAGE ENERGY CORPORATION

INDEX TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS

October 31, 20182019

The accompanying notes are an integral part of these consolidated financial statements.

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MIRAGE ENERGY CORPORATION

Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

The accompanying notes are an integral part of these consolidated financial statements.

MIRAGE ENERGY CORPORATION

Statement of Stockholders’ (Deficit)

(Unaudited)

For the Three Months Ended October 31, 2018

For the Three Months Ended October 31, 2019

.

The accompanying notes are an integral part of these unaudited consolidated financial statements.

MIRAGE ENERGY CORPORATION

Consolidated Statements of Cash Flows

(Unaudited)

		Three Months Ended
		October 31,
		2018				2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)		$	(406,896	)		$	(263,502	)
Adjustments to reconcile net (loss) to net cash used in operating activities:
Depreciation expense			395				395
Financing Fees			9,500				-
Loss on change in fair value of convertible debt			142,420				-
Changes in operating assets and liabilities:
Prepaid expenses			(389	)			246
Accounts payable			84,411				36,416
Accrued expenses			2,580				14,247
Accrued salaries and payroll taxes, related parties			127,608				161,327
Net cash (used) in operating activities			(40,371	)			(50,871	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from loan, related party			-				14,200
Repayments of loan, related party			(53,183	)			(12,357	)
Proceeds from sale of convertible debt			91,500				38,000
Net cash provided by financing activities			38,317				39,843
Net (decrease) in cash			(2,054	)			(11,028	)
Cash and cash equivalents - beginning of period			13,480				11,776
Cash and cash equivalents - end of period		$	11,426			$	748
Supplemental Cash Flow Disclosures
Cash paid for interest		$	2,539			$	641
Cash paid for income taxes		$	-			$	-
Supplemental Non-Cash Activity Disclosures
Expenses paid by shareholder		$	3,977			$	4,173
Stock issued for convertible interest		$	5,215			$	-
Stock issued for convertible debt		$	217,503			$	-
Proceeds from sale of convertible debt paid directly to vendor		$	10,500			$	-

The accompanying notes are an integral part of these consolidated financial statements.

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MIRAGE ENERGY CORPORATION

Notes to the Consolidated Interim Financial Statements

October 31, 20182019

(Unaudited)

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

Mirage Energy Corporation (formerly Bridgewater Platforms Inc.) (the “Company”) is a Nevada corporation incorporated on May 6, 2014. On May 20, 2014, the Company incorporated a Canadian subsidiary known as Bridgewater Construction Ltd. in Ontario in association with its construction business. Mirage Energy Corporation is based at 900 Isom Rd Suite 306, San Antonio, TX 78216. The Company’s fiscal year end is July 31.

NOTE 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States.

In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s 10-K filed with the Securities and Exchange Commission on December 24, 2018.

Leases

In February 2016, the FASB issued guidance regarding the accounting for leases on Leases (“ASC 842”). The Company will adopt ASC 842 effective August 1, 2020 after electing to defer one year as an Emerging Growth Company which requires lessees to recognize right-of-use (“ROU”) assets and liabilities for leases with lease terms of more than twelve months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The term of the existing lease on the office premises ends June 30, 2022. Refer to Note 6 below for further information on this lease.

Net Loss Income (Loss) Per Share of Common Stock

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic lossincome (loss) per share is computed by dividing net lossincome (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding plus common stock equivalents (if dilutive) related to convertible debt, stock options and warrants for each year. In the period of net loss, diluted EPS calculation is not deemed necessary as the effect would be anti-dilutive.

As of October 31, 20182019, and July 31, 2018,2019, the Company has convertible notes with a total base principal of $229,500$121,500 and $207,500,$53,000, respectively, which become convertible in 180 days. There is a potential for 5,143,512 shares if the principal of $121,500 were converted at October 31, 2019. These notes will have a dilutive effect on common stock.stock for the quarter ended October 31, 2019. The Company has no other potentially dilutive securities, such as options or10,000,000 shares of Mirage’s Series A Preferred Stock which possess 20 votes per share and are convertible into 200,000,000 common shares. As of October 31, 2019, the Company has two common stock purchase warrants currentlyopen and they have not been exercised. For each warrant, there are 164,062 warrant shares issued and outstanding.outstanding which upon exercise could potentially be 8,706,442 common stock shares. 

Basis of Consolidation

These financial statements include the accounts of the Company and its wholly owned subsidiaries, 4Ward Resources, Inc., Cenote Energy, S. de R.L. de C.V., WPF Transmission, Inc., and WPF Mexico Pipelines, S. de R.L. de C.V. All material intercompany balances and transactions have been eliminated.

Financial Instruments

The Company’s notes that have become convertible are subject to ASC Topic 480, “Distinguishing Liabilities from Equity,” as the debt is a mostly fixed amount to be settled with a variable number of shares.

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NOTE 3 - GOING CONCERN

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company had a net loss of $406,896$427,157 and had net cash used in operations of $40,371$227,034 for the three months ended October 31, 20182019 and had an accumulated deficit and working capital deficit of $3,745,941$6,979,905 and $2,551,292$3,146,536 at that date. The Company has not established an ongoing source of revenues sufficient to cover its operating cost and requires additional capital to commence its operating plan. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company may include, but not be limited to: sales of equity instruments; traditional financing, such as loans; sale of participation interests and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 4 - DEBT

As of October 31, 2018,2019, the number of shares of common stock that can be issued for convertible debt as per Note 9 - Subsequent Events are 4,694,538.4,830,016. The other notes were not convertible at October 31, 2018 All2019. For the quarter ended October 31, 2019, there was a $106,263 loss on change in fair value of convertible debt is in default due to missing the 10-K filing deadline.debt.

A summary of debt at October 31, 20182019 and July 31, 20182019 is as follows: 

Convertible debenture, unsecured, interest bearing at 12% per annum, issued February 26, 2018 in the amount of $43,000 with fees of $3,000 and cash proceeds of $40,000, convertible at August 25, 2018 with conversion price at a discount rate of 45% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of November 30, 2018. This note defaulted on March 25, 2018 and a default penalty of $21,500 was added to the note for a total of $64,500 and incurred default interest rate of 22%. During August and September 2018, $64,500 of this debt plus $2,580 in interest was converted and the Company issued 8,467,776 shares of common stock with a fair value of $167,534 in payment leaving no balance due. The convertible note had a net change in fair value of $105,111.			-				64,500
Convertible debenture, unsecured, interest bearing at 12% per annum, issued June 12, 2018 in the amount of $32,000 with fees of $2,000, cash proceeds of $28,200 and disbursement of $1,800, convertible at December 9, 2018 with conversion price at a discount rate of 45% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of March 30, 2019. As of October 31, 2018, there was a principal balance of $32,000. This note becomes convertible on December 9, 2018. This note defaulted on November 14, 2018 and a default penalty of $16,000 will be added to the note for a total of $48,000 and incurred default interest rate of 22%.			32,000				32,000
Convertible debenture, unsecured, interest bearing at 12% per annum,, issued June 12, 2018 in the amount of $18,000 with fees of $0 and cash proceeds of $18,000 which was paid directly to the vendor, convertible at December 9, 2018 with conversion price at a discount rate of 45% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of March 30, 2019. As of October 31, 2018, there was a principal balance of $18,000. This note becomes convertible on December 9, 2018. This note defaulted on November 14, 2018 and a default penalty of $9,000 will be added to the note for a total of $27,000 and incurred default interest rate of 22%.			18,000				18,000
Convertible debenture, unsecured, interest bearing at 12% per annum,, issued July 10, 2018 in the amount of $38,000 with fees of $3,000 and cash proceeds of $35,000, convertible at January 6, 2019 with conversion price at a discount rate of 45% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of April 30, 2019. As of October 31, 2018, there was a principal balance of $38,000. This note becomes convertible on January 6, 2019. This note defaulted on November 14, 2018 and a default penalty of $19,000 will be added to the note for a total of $57,000 and incurred default interest rate of 22%.			38,000				38,000
Convertible debenture, unsecured, interest bearing at 12% per annum, issued August 6, 2018 in the amount of $35,000 with fees of $3,000, cash proceeds of $32,000, convertible at February 2, 2019 with conversion price at a discount rate of 49% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of May 30, 2019. As of October 31, 2018, there was a principal balance of $35,000. This note becomes convertible on February 2, 2019. This note defaulted on November 14, 2018 and a default penalty of $17,500 will be added to the note for a total of $52,500 and incurred default interest rate of 22%.			35,000				-
Convertible debenture, unsecured, interest bearing at 12% per annum,, issued August 27, 2018 in the amount of $33,000 with fees of $3,000 and cash proceeds of $30,000, convertible at February 23, 2019 with conversion price at a discount rate of 49% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of June 15, 2019. As of October 31, 2018, there was a principal balance of $33,000. This note becomes convertible on February 23, 2019. This note defaulted on November 14, 2018 and a default penalty of $16,500 will be added to the note for a total of $49,500 and incurred default interest rate of 22%.			33,000				-

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Convertible debenture, unsecured, interest bearing at 12% per annum, issued September 20, 2018 in the amount of $33,000 with fees of $3,000 and cash proceeds of $30,000, convertible at March 19, 2019 with conversion price at a discount rate of 49% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of July 15, 2019. As of October 31, 2018, there was a principal balance of $33,000. This note becomes convertible on March 19, 2019. This note defaulted on November 14, 2018 and a default penalty of $16,500 will be added to the note for a total of $49,500 and incurred default interest rate of 22%.			33,000				-
Convertible debenture, unsecured, interest bearing at 12% per annum, issued October 25, 2018 in the amount of $10,500 with fees of $0 and cash proceeds of $10,500 which was paid directly to the vendor, convertible at April 23, 2019 with conversion price at a discount rate of 49% of market price which is the average of the lowest trading price during the twenty trading day period ending on the latest complete trading day prior to the conversion date, maturity date of August 15, 2019. As of October 31, 2018, there was a principal balance of $10,500. This note becomes convertible on April 23, 2019. This note defaulted on November 14, 2018 and a default penalty of $5,250 will be added to the note for a total of $15,750 and incurred default interest rate of 22%.			10,500				-
Loan payable related party, unsecured, non-interest bearing, on demand			523				2,229
Total Debt			525,289				540,155
Less: Current Maturities			475,289				490,155
Total Long-Term Debt		$	50,000			$	50,000

NOTE 5 - RELATED PARTY TRANSACTIONS

As of October 31, 2018,2019, the CEO and two other members of management and one other employee had earned accrued unpaid salary in the amount of $1,488,750.$1,790,924. Accrued salaries of $1,488,750$1,790,924 combined with accrued payroll taxes of $52,034$61,951 for a total accrued related party salaries and payroll tax of $1,540,784$1,852,875 for the period from June 2015 until October 31, 2018.2019.

Also, Mr. Michael Ward, President, wasprovided $1,000 directly to the Company with an additional $8,575 owed $2,229 at July 31, 2018 which has decreased to $523 as of October 31, 2018 resulting from additional expenses paid of $3,977 and repayments of $5,683 during the three months ended October 31, 2018.

Additionally, White Boy Partnership, LLC, a company owned by the spousefor monies outlaid on behalf of the CEO, had providedCompany for a total loan amount of $187,600. Repayments$9,575 which was netted for $9,575 in payments received leaving a net due Mr. Ward of $34,724 were made during$0 at October 31, 2019. During the year ended July 31, 2018, which reduced the2019, Mr. Ward had a previous balance due of $2,229 with an additional $24,898 of expenses paid which increased the total amount due to $152,876 as$27,127 less repayments of July 31, 2018. Due to additional payments of $47,500 for the period ended October 31, 2018 the balance has decreased to a total loan amount of $105,376.$27,127.

NOTE 6 – LEASES

On June 9, 2016, the Company entered into a Lease Agreement for its San Antonio, Texas office lease location. The Lease Period iswas for three (3) years beginning July 1, 2016. On July 1, 2019, the Company entered into a First Amendment to Lease Agreement at same location. The landlord is holdingcontinues to hold $6,921 as security and shallwhich is to be returned at the end of the new lease. The new Lease Period is three (3) years beginning July 1, 2019. The Company shall pay as additional rent all other sums of money as shall become due and payable by them under this Lease. To date after twenty-eight (28)four (4) months of this thirty-six (36) month lease, no such additional charges have been made. The Company has incurred rent expense in the amount of $21,010$21,100 and $82,178$83,974 for the three monthquarter ended October 31, 20182019 and the year ended July 31, 21082019, respectively. Below is the schedule of base rent for the remaining Lease term as of October 31, 2018.2019.

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NOTE 7 - COMMITMENTS AND CONTINGENCIES

The Company committed to eighteen (18) months of Acquisition of Pipeline Rights of Way to Marcos y Asociados with a total amount of $77,844 which was due April 15, 2018 and not paid as of October 31, 2018.2019. Interest will continue accruing after October 31, 20182019 until it is paid.

From time to time the Company may become a party to litigation matters involving claims against the Company. Management believes that it is adequately insured for its operations and there are no current matters that would have a material effect on the Company’s financial position or results of operations.

NOTE 8 – EQUITY

During the three months ended October 31, 2019, the Company issued 4,830,016 shares of common stock for conversion of convertible notes on August 16, 2019 totaling $58,250 with a fair value of $320,813 for the debt and a fair value of $31,778 for the interest totaling $352,591.

Also, the Company issued 3,696,973 shares of common stock as a cashless exercise of common stock warrants. On October 16, 2019, Crown Bridge Partners, LLC exercised the right to purchase 3,696,973 shares of common stock per the Common Stock Warrant that was issued with November 13, 2018 note.

On August 28, 2018, Power Up Lending Group Ltd converted principal5, 2019, Crown Bridge Partners, LLC funded a third tranche of $35,000 and in addition the amount of $20,000 of the $43,000 note issued February 26, 2018 that was defaultedCompany will have to $64,500provide 164,062 warrant shares for 2,702,703 shares of common stock.holder to purchase.

On August 31, 2018, Power Up Lending Group Ltd converted principal inIn the amountmonth of $15,000 ofOctober 2019, the $43,000 note issued February 26, 2018 that was defaulted to $64,500 forCompany sold 2,000,000 shares of common stock.stock to investors for cash proceeds of $80,000.

On September 5, 2018, Power Up Lending Group Ltd converted principal in the amount of $15,000 of the $43,000 note issued February 26, 2018 that was defaulted to $64,500 for 1,948,052 shares of common stock.

On September 10, 2018, Power Up Lending Group Ltd converted the remaining principal in the amount of $14,500 of the $43,000 note issued February 26, 2018 that was defaulted to $64,500 for 1,542,553 shares of common stock along with $2,580 of accrued interest for 274,468 shares of common stock.

On September 11, 2018, JSJ Investments, Inc. converted principal in the amount of $25,000 of the $75,000 note issued January 5, 2018 for 3,223,726 shares of common stock.

NOTE 9 - SUBSEQUENT EVENTS

The Company evaluated events occurring subsequent to October 31, 2018,2019, identifying those that are required to be disclosed as follows: 

In December 2019, a novel coronavirus disease (“COVID-19”) was reported and in January 2020, the World Health Organization (“WHO”) declared it a Public Health Emergency of International Concern. On November 6, 2018, JSJ Investments Inc. attemptedFebruary 28, 2020, the WHO raised its assessment of the COVID-19 threat from high to convertvery high at a global level due to the remaining principalcontinued increase in the amountnumber of $30,000cases and affected countries, and on March 11, 2020, the WHO characterized COVID-19 as a pandemic. While the Company did not incur significant disruptions to its operations during the first quarter of 2020 from COVID-19, it is unable at this time to predict the impact that COVID-19 will have on its business, financial position and operating results in future periods due to numerous uncertainties and is closely monitoring the impact of the $75,000 note issued January 5, 2018 for 3,896,103 sharespandemic on all aspects of common stock along with interest of $6,148 of accrued interest for 798,435 shares of common stock but was rejected and have not yet been issued.

On November 13, 2018, the Company entered into Securities Purchase Agreement with Crown Bridge Partners, LLCits business.  Beginning April 1, 2020, it became more difficult to issue a convertible note in the aggregate principal amount of $105,000, with unsecured, interest bearing at 10% per annum and a maturity date of November 13, 2019schedule business trips to Mexico for the first tranchepurpose of continuing our efforts to complete final documentation for $35,000. The Company does not intend to draw down any more.

In November 2018,our Mexican projects as part of one note holder’s conversion request, shares underlying that/those conversions have not yet been issued resulting in a dispute between the Company and the note holder as to potential penalties under the note agreement. The Company is in discussions with the note holder on this matter ascertain portions of the date ofgovernment were not available at all times due to the filing report.COVID-19.

In January 2019,2020, the Company offered and sold 5,000,0004,200,000 shares of common stock at $0.025$0.035 per share for $125,000.$147,000.

On February 10, 2020, Crown Bridge Partners, LLC exercised the right to purchase 4,109,828 shares of common stock per the Common Stock Warrant, adjusted for dilution, that was issued with November 13, 2018 note.

In March 2020, the Company offered and sold 3,083,334 shares of common stock at $0.06 per share for $185,000.

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

Forward-Looking Statements

Except for historical information, this report contains certain forward-looking statements. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed herein as well as in the “Current Business” and “Risk Factors” sections in our 10-K for the year ended July 31, 2018, as filed on December 24 , 2018. You should carefully review the risks described in our documents we file from time to time with the Securities and Exchange Commission (“SEC”). You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

All references in this Form 10-Q to the “Company,” “Mirage Energy,” “we,” “us,” or “our” are to Mirage Energy Corporation (formerly Bridgewater Platforms Inc.)

Corporate Overview

Company’s Plans

The Company has proposed to develop an integrated natural gas pipeline system in Texas and Mexico. The purpose of these pipelines will transport and store natural gas in an underground natural gas storage facility, which the Company proposes to permit and develop in northern Mexico. The Company believes that it has made substantial progress toward these goals with its preliminary project engineering designs and high levelhigh-level meetings with representatives of various Mexican regulatory agencies.

Discussion and Analysis of Financial Condition and Results of Operations

Revenues

ThreeThree-month period ended October 31, 2019

For the three (3) month period ended October 31, 2019, we generated no revenue and incurred a net loss of $427,157.

Our net loss of $427,157 for the three (3) month period ended October 31, 2019 was the result of operating expenses of $303,266 and other expense (comprised of interest expense and change in fair value of convertible debt) of $123,891. Our operating expenses consisted of $262,975 in general and administrative expenses, and $40,291 in professional fees.

Three-month period ended October 31, 2018

For the three (3) month period ended October 31, 2018, we generated no revenue and incurred a net loss of $406,896.

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Our net loss of $406,896 for the three (3) month period ended October 31, 2018 was the result of operating expenses of $251,980 and other expense (comprised of interest expense)expense and change in fair value of convertible debt) of $154,916. Our operating expenses consisted of $212,677 in general and administrative expenses, and $39,303 in professional fees.

Three month period ended October 31, 2017

For the three (3) month period ended October 31, 2017, we generated no revenue and incurred a net loss of $263,502.

Our net loss of $263,502 for the three (3 month period ended October 31, 2017 was the result of operating expenses of $258,364 and other expense (comprised of interest expense) of $5,138. Our operating expenses consisted of $227,882 in general and administrative expenses, and $30,482 in professional fees.

Costs and Expenses

Our primary costs going forward are related to engineering, travel, professional fees, and legal fees, financing fees and salaries and related payroll taxes associated with our proposed pipeline and natural gas storage activities in Mexico.

For the three (3) monthsThree month period ended October 31, 20182019 and October 31, 2017, total general and administrative expenses were $212,677 and $227,882, respectively.2018

For the three (3) months ended October 31, 2018,2019, we had $212,677$262,975 in general and administrative expenses compared to $227,882$212,677 in general and administrative expenses for the three (3) months ended October 31, 2017.2018. The $15,205 decrease$50,298 increase in general and administrative expenses was primarily the result of spending related to executive compensation, office rental,consulting fees, financing fees, travel and entertainment public relations fees and other general and administrative expenses.to a decrease in executive compensation during the three (3) months ended October 31, 2019.

The professional fees for the three (3) months ending October 31, 20182019 and October 31, 20172018 were $39,303$40,291 and $30,482,$39,303, respectively. The $8,821$988 increase was primarily related to increases in legal fees, auditingaudit fees and other professionalto decreases in legal fees.

The executive compensation for the three (3) months ending October 31, 20182019 and October 31, 20172018 was $116,500$92,000 and $116,500 respectively. No changeThe difference was due to the same executives employed at the same compensation during both periods.decrease in salaries because one executive left as of yearend July 31, 2019.

Liquidity and Capital Resources

Cash Flows

Operating Activities

For the three (3) month period ended October 31, 2019, net cash used in operating activities was $227,034. The negative cash flow for the three (3) months ended October 31, 2019 related to our net loss of $427,157, a decrease in prepaid expenses of $2,035, adjusted for $32,648 in financing fees, adjusted for depreciation of $395, a change of $106,263 in convertible debt due to fair market value, an increase of $66,663 in accounts payable, an increase of $5,250 in accrued expenses and an decrease of $9,061 in accrued salaries and payroll taxes – related parties.

For the three (3) month period ended October 31, 2018, net cash used in operating activities was $40,371. The negative cash flow for the three (3) months ended October 31, 20182019 related to our net loss of $406,896, a decrease in prepaid expenses of $389, adjusted for $9,500 in financing fees, adjusted for depreciation of $395, a change of $142,420 in convertible debt due to fair market value, an increase of $84,411 in accounts payable, an increase of $2,580 in accrued expenses and an increase of $127,608 in accrued salaries and payroll taxes – related parties.

Investing Activities

For the three (3) month period ended October 31, 2017, net cash used in operating activities was $50,871. The negative cash flow for the three (3) months ended October 31, 2017 related to our2019 net loss of $263,502, an increasecash used in prepaid expenses of $246, adjusted for depreciation of $395, an increase of $36,416 in accounts payable, an increase of $14,247 in accrued expenses and an increase of $161,327 in accrued salaries and payroll taxes – related parties.

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Investing Activitiesinvesting activities was nil.

For the three (3) months ended October 31, 2018 net cash used in investing activities was nil.

Financing Activities

For the three (3) months ended October 31, 20172019, net cash used in investingprovided from financing activities was nil.$368,925. The positive cash flow from financing activities for such period was comprised of an increase in loans payable from related parties, proceeds from sale of common stock, and proceeds from sale of convertible debenture.

Financing Activities

For the three (3) months ended October 31, 2018, net cash provided from financing activities was $38,317. The positive cash flow from financing activities for such period was comprised of an increase in loans payable from related parties, proceeds from sale of common stock, and proceeds from a long-term loan and convertible debenture.

For the three (3) months ended October 31, 2017, net cash provided from financing activities was $39,843. The positive cash flow from financing activities for such period was comprised of a net increase in loans payable from related parties and proceeds from a convertible debenture.

Liquidity

To date, we have funded our operations primarily with capital provided and loans provided by related parties, accruing of salaries and accounts payable. We do not currently have commitments in regards toregarding fixed costs.

As of October 31, 2018,2019, Mirage Energy Corporation had $11,426$212,347 in cash on hand and prepaid expenses of $2,695.$3,795. Since Mirage Energy Corporation was unable to reasonably project its future revenue, it must presume that it will not generate any revenue during the next twelve (12) to twenty-four (24) months. We therefore will need to obtain additional debt or equity funding in the next two (2) – three (3) months, but there can be no assurances that such funding will be available to us in sufficient amounts or on reasonable terms.

The Company’s audited financial statements for the year ended July 31, 20182019 contain a “going concern” qualification. As discussed in Note 3 of the Notes to Financial Statements, the Company has incurred losses and has not demonstrated the ability to generate cash flows from operations to satisfy its liabilities and sustain operations. Because of these conditions, our independent auditors have raised substantial doubt about our ability to continue as a going concern.

Our financial objective is to make sure the Company has the cash and debt capacity to fund on-going operating activities, investments and growth. We intend to fund future capital needs through our current cash position, additional credit facilities, future operating cash flow and debt or equity financing. We are continually evaluating these options to make sure we have capital resources to meet our needs.

Existing capital resources are insufficient to support continuing operations of the Company over the next 12 months.

Management makes no assurances that adequate capital resources will be available to support continuing operations over the next 12 months. Management plans to pursue additional capital funding through multiple sources.

For the year ended July 31, 2018,2019, the Company has funded operations with debt of $279,000$329,500 from convertible notes, and proceeds from sale of $40,100 from related party loans$325,978 in common stock, while making loan repayments of $95,398.$180,003 to related party and $83,250 to convertible notes. The Company plans to raise additional funds through various sources to support ongoing operations throughout fiscal year 2019.

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during 2019 and 2020.

While no assurances can be given regarding the achievement of future results as actual results may differ materially, management anticipates adequate capital resources to support continuing operations over the next 12 months through the combination of infused capital through exercised warrants, infused capital through non-public private placement and existing cash reserves.

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 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 principal 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 principal accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report due to our limited member of officers and members of the Board of Directors.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended October 31, 2018,2019, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II-OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are no material legal proceedings pending against the Company to the knowledge of management.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In JanuaryDuring the quarter ending October 31, 2019, the Company offered and sold 5,000,0002,000,000 shares of restricted common stock at $0.025 per shareto nine (9) accredited investors for $125,000.cash proceeds of $80,000.

The Shares were not registered under the Securities Act of 1933, as amended (the “Securities Act”), and were in each case offered, sold and issued in reliance upon the exemption from registration provided by Section 4 (a) (2) of the Securities Act, as a transaction by an issuer not involving a public offering, and Rule 506 of Regulation D promulgated thereunder.thereunder and Regulation S.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Debt Financing Matters:

On August 5, 2019, Crown Bridge Partners, LLC funded a third tranche of $35,000 and in addition the Company will have to provide 164,062 warrant shares for holder to purchase.

On August 12, 2019, the Company entered into a Securities Purchase Agreement with Power Up Lending Group Ltd. to issue a convertible note in the principal amount of $73,000, with unsecured, interest bearing at 12% per annum and a maturity date of May 30, 2020.On August 16, 2019, Crown Bridge Partners, LLC converted principal in the amount of $53,000 consisting of $52,500 of principal and $500 of fees plus interest of $5,250 for 4,830,016 shares of common stock on the second tranche of $35,000 of the note that was issued November 13, 2018 in the aggregate principal amount of $105,000 to be funded in three (3) tranches and the second tranche defaulted with a penalty of $17,500.

On September 12, 2019, the Company entered into a Securities Purchase Agreement with BHP Capital NY Inc. and Jefferson Street Capital, LLC, severally and not jointly, to issue convertible notes in the aggregate principal amount of $165,000, each in the principal amount of $82,500, with unsecured, interest bearing at 8% per annum and a maturity date of May 30, 2020.

On September 24, 2019, the Company entered into a Securities Purchase Agreement with Power Up Lending Group Ltd. to issue an additional amount of convertible note in the amount of $55,000, with unsecured, interest bearing at 12% per annum and a maturity date of July 12, 2020.

On October 17, 2019, Crown Bridge Partners, LLC exercised the right to purchase 3,696,973 shares of common stock per Common Stock Warrant that was issued with November 13, 2018 note.

The Company'sCompany’s repeated failures to timely file its SEC reports have triggered defaults on our convertible promissory notes which will subject the Company to financial penalties. See Financial Statement Footnote 4.

Press Release Disclosure Update:

On March 16, 2020, the Company issued a press release stating that it had signed an agreement with Northern Hemisphere Logistics (“NHL”) for a 30% participation interest in the development of the Isthmus Corridor Project, the “Project”. The agreement, which was an assignment agreement, has not been performed and legal consideration has not been exchanged. To date, NHL has not acquired any rights in this proposed Project, and therefore, the Company’s rights to participate have not matured into any material value. Effective May 4, 2020, the Assignment Agreement was rescinded.

ITEM 6. EXHIBITS

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: FebruaryMay 11, 20192020

Mirage Energy Corporation

(Registrant)

By:	/s/ Michael R. Ward		/s/ Michael R. Ward
	Michael R. Ward		Michael R. Ward
	Chief Executive Officer (Principal Executive Officer)		Chief Financial Officer (Principal Accounting Officer)

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