Rocky Mountain Resources CEO Retires Amid Financial Troubles For The Company Behind Contentious Glenwood Quarry Expansion
Chad Brownstein is out as CEO of Rocky Mountain Resources, the company which wants to greatly expand a limestone quarry outside of Glenwood Springs.
The resort community sees the expansion as a threat to both tourism and its hot springs.
Brownstein's retirement comes at a time of financial trouble for the natural resources company. The company's most recent financial report to the U.S. Securities and Exchange Commission states that independent auditors have expressed "substantial doubt as to [RMR's] ability to continue as a going concern due to [RMR's] limited liquidity and [RMR's] lack of revenues."
Rocky Mountain Resources has not responded to a request for comment.
"As of March 31, 2019, we had current assets of $932,180, total current liabilities of $2,734,144 and working capital deficit of $1,801,964. We have incurred an accumulated loss of $35,428,938 since inception," according to the report.
RMR does not generate adequate cash flow to support its existing operations, according to the filing, and that "the historical and existing capital structure is not adequate to fund our planned growth."
That growth includes the plan to expand its limestone quarry. The report states that cash needs are "significant due to our business plan, which contemplates future acquisitions, development of the Company’s Rail Park asset and expansion of the Company’s mining operations."
The company anticipates generating losses into 2021, though it does state it should be able to raise "sufficient amounts of working capital in the near term through debt or equity offerings as may be required to meet short-term obligations, although this cannot be guaranteed."
RMR does say they do not have "any arrangements for additional financing," and that a failure to secure additional financing may force the company to change its business plans.
"In addition, we cannot be assured of profitability in the future," the report adds.
The expansion of the Mid-Continent Quarry is seen as one of the company's attempts to save itself. They say that the project "will allow greater volume production with limited fixed cost increases."
Although Brownstein is stepping down as CEO, he will remain an employee of the company, according to an SEC report. He'll also continue as the non-executive Chairman of the Board of Directors. Gregory Dangler, Brownstein's replacement as CEO, was the past president and director of RMR.
Brownstein is the son of Norm Brownstein, chairman of one of the largest natural resources lobbying firms in the country, Brownstein Hyatt Farber Schrek, where Secretary of the Interior David Bernhardt once worked. Residents fighting the quarry's expansion fear the Bureau of Land Management's decision on the proposal will be influenced by Bernhardt. The Interior secretary had previously recused himself from situations that included his former employer, but that two-year agreement expired in August.
Under the "Family Relationships" section of the SEC financial report, the company disclosed that they have paid the law firm $438,576 for its services by March 31, 2019.
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