AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ONSeptember 4, 2008
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,Washington, D.C. 20549
AMENDMENT NO. 3TO
FORM S-1REGISTRATION STATEMENTUNDER
Registration Statement Under
THE
SECURITIES ACT OF 1933
vetanova, INC.
YUKON GOLD CORPORATION, INC.
(Exact name of small business issuerregistrant as specified in its charter)
Nevada | 0182 | |||
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(State or other jurisdiction of incorporation) | (Primary Standard Industrial |
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YUKON GOLD CORPORATION, INC.55 York StreetSuite 401Toronto, ON M5J 1R7Telephone: 416-865-9790Facsimile: 416-865-1250
85-1736272 | 335 A Josephine St. Denver, CO 80206 | |
(IRS Employer I.D. Number) | (Address, including zip code, and telephone number including area of principal executive offices) |
John McKowen
335 A Josephine St.
Denver, Colorado 80206
(303) 248-6883
(Name and address, including zip code, and
telephone number, including
area code, of agent for service)
Copies of all communications, including all communications sent
to the agent for service, should be sent to:
Jonathan H. GardnerKavinoky Cook LLP726 Exchange Street; Suite 800Buffalo, New York 14210
Approximate date of proposed sale to the public: William T. Hart, Esq.
Hart & Hart
1624 Washington Street
Denver, Colorado 80203
(303) 839-0061
As soon as practicable after the effective date of this Registration Statement.Statement
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box.xbox:
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act Registration Statementregistration statement number of the earlier effective Registration Statementregistration statement for the same offering.o [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box, and list the Securities Act Registration Statementregistration statement number of the earlier effective Registration Statementregistration statement for the same offering.o [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box, and list the Securities Act Registration Statementregistration statement number of the earlier effective Registration Statementregistration statement for the same offering.o [ ]
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 “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act (Check one):Act.
Large accelerated filer |
| Accelerated filer |
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Non-accelerated filer |
| Smaller reporting company |
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Emerging growth company | [X] |
EXPLANATORY NOTE
This registration statement constitutes a Pre-Effective AmendmentIf an emerging growth company, indicate by check mark if the registrant has elected not to Registration No. 333-149459, filed on February 29, 2008 as amended by Amendment No. 1 filed on May 22, 2008, and Amendment No. 2 filed on July 24, 2008, and a Post-Effective Amendmentuse the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Registration No. 333-140674, Registration Statement No. 333-142276, and Registration Statement No. 333-137039. Pursuant to Rule 429 underSection 13(a) of the SecuritiesExchange Act the prospectus included in this registration statement is a combined prospectus and relates to an aggregate of 32,417,919 shares of common stock, including (a) 3,801,688 shares of common stock, including common stock underlying warrants, that were previously registered for resale in a registration statement on Form SB-2, Registration No. 333-140674, (b) 373,598 shares of common stock, including common stock underlying warrants that were previously registered for resale in a registration statement on Form SB-2, Registration No. 333-142276 and (c) 9,543,364 shares of common stock, including common stock underlying warrants, previously registered for resale in a registration statement on Form SB-2, Registration No. 333-137039.[X]
- 2 -
CALCULATION OF REGISTRATION FEE
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Title Of Each Class Of |
| Amount to be |
| Proposed |
| Proposed |
| Amount of |
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Common Stock, Par Value $0.0001 per Share (1) |
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| 5,970,939 |
| $ | 0.25 |
| $ | 1,492,735 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Warrants of the Company (2) |
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| 807,692 |
| $ | 0.70 |
| $ | 565,384 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Unit Warrants of the Company (3) |
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| 2,177,775 |
| $ | 0.60 |
| $ | 1,306,665 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Compensation Options (4) |
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| 129,230 |
| $ | 0.52 |
| $ | 67,200 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Unit Compensation Options (5) |
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| 348,444 |
| $ | 0.45 |
| $ | 156,800 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Compensation Warrants (6) |
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| 174,221 |
| $ | 0.60 |
| $ | 104,533 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Compensation Warrants (6) |
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| 64,614 |
| $ | 0.70 |
| $ | 45,230 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Warrants (7) |
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| 500,000 |
| $ | 0.24 |
| $ | 120,000 |
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| Previously Paid |
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- 3 -
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Stock Options (8) |
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| 1,837,500 |
| $ | 0.30 |
| $ | 550,782 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Special Warrants of the Company [previously covered by Registration Statement No. 333-140674] (9) |
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| 2,823,049 |
| $ | 0.90 |
| $ | 2,540,744 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Special Warrants of the Company [previously covered by Registration Statement No. 333-140674] (10) |
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| 334,218 |
| $ | 0.77 |
| $ | 257,348 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share, issuable upon exercise of Warrants issuable upon exercise of Unit Special Warrants [previously covered by Registration Statement No. 333-140674] (10) |
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| 334,218 |
| $ | 0.90 |
| $ | 300,796 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Flow-through Compensation Warrants [previously covered by Registration Statement No. 333-140674] (11) |
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| 197,613 |
| $ | 0.90 |
| $ | 177,851 |
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| Previously Paid |
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- 4 -
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-140674] (12) |
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| 56,295 |
| $ | 0.81 |
| $ | 45,599 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Common Share Purchase Warrants issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-140674] (12) |
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| 56,295 |
| $ | 0.90 |
| $ | 50,666 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Special Warrants of the Company [previously covered by Registration Statement No. 333-142276] (13) |
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| 282,309 |
| $ | 0.90 |
| $ | 254,078 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Special Warrants of the Company [previously covered by Registration Statement No. 333-142276] (14) |
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| 33,423 |
| $ | 0.77 |
| $ | 25,736 |
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| Previously Paid |
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- 5 -
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Common Stock Par Value $0.0001 per Share, issuable upon exercise of Warrants issuable upon exercise of Unit Special Warrants [previously covered by Registration Statement No. 333-142276] (14) |
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| 33,423 |
| $ | 0.90 |
| $ | 30,081 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Flow-through Compensation Warrants [previously covered by Registration Statement No. 333-142276] (15) |
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| 19,763 |
| $ | 0.90 |
| $ | 17,787 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-142276] (16) |
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| 2,340 |
| $ | 0.81 |
| $ | 1,895 |
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| Previously Paid |
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Common Stock Par Value $0.0001 per Share issuable upon exercise of Common Share Purchase Warrants issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-142276] (16) |
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| 2,340 |
| $ | 0.90 |
| $ | 2,106 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share [previously covered by Registration Statement No. 333-137039] (17) |
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| 9,543,364 |
| $ | 0.95 |
| $ | 9, 066,196 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company (18) |
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| 245,455 |
| $ | 1.00 |
| $ | 245,455 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company (19) |
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| 950,000 |
| $ | 2.00 |
| $ | 1,900,000 |
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| Previously Paid |
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- 6 -
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Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company (20) |
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| 2,665,669 |
| $ | 0.90 |
| $ | 2,399,102 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share issuable upon exercise of Broker Warrants of the Company (21) |
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| 533,133 |
| $ | 0.60 |
| $ | 319,880 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share issuable upon exercise of warrants underlying Broker Warrants of the Company (22) |
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| 266,567 |
| $ | 0.90 |
| $ | 239,910 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (23) |
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| 400,000 |
| $ | 0.75 |
| $ | 300,000 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (24) |
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| 369,215 |
| $ | 0.545 |
| $ | 201,222 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (25) |
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| 36,504 |
| $ | 0.55 |
| $ | 20,077 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (26) |
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| 150,000 |
| $ | 0.87 |
| $ | 130,500 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (27) |
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| 490,909 |
| $ | 0.545 |
| $ | 270,000 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (28) |
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| 149,867 |
| $ | 0.545 |
| $ | 82,427 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (29) |
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| 150,000 |
| $ | 1.00 |
| $ | 150,000 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (30) |
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| 10,000 |
| $ | 0.55 |
| $ | 5,500 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (31) |
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| 61,171 |
| $ | 0.88 |
| $ | 53,824 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (32) |
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| 24,000 |
| $ | 0.75 |
| $ | 18,000 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (33) |
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| 50,000 |
| $ | 0.75 |
| $ | 37,500 |
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| Previously Paid |
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Common Stock, Par Value $0.0001 per Share (34) |
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| 136,364 |
| $ | 0.42 |
| $ | 57,252 |
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| Previously Paid |
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Total |
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| 32,417,919 |
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| $ | 23,610,861 |
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| Previously Paid (35) |
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- 7 -
* This registration statement also includes an indeterminate amount of securities which may be issued in the event of a stock split, stock dividend or other recapitalization of the Company’s capital stock.
(1) Represents shares of common stock issued by the Company on August 16, 2007 and November 16, 2007 as part of its Flow Through Units and Units placed with investors.
Maximum | Proposed | |||||||||||||||
Amount to | Offering | Maximum | Amount of | |||||||||||||
Title of each Class | be | Price per | Aggregate | Registration | ||||||||||||
of Securities to be Registered | Registered (1) | Share (3) | Offer Price | Fee | ||||||||||||
Common Stock | 37,888,421 | $ | 0.16 | $ | 6,062,148 | |||||||||||
Warrants | 37,888,421 | $ | 0.01 | 378,884 | ||||||||||||
Shares Issuable upon exercise of Warrants | 37,888,421 | $ | 0.20 | 7,577,683 | ||||||||||||
Shares to be sold by Selling Shareholders | 105,709,016 | $ | 0.16 | 16,913,443 | ||||||||||||
$ | 30,932,158 | $ | 3,375 |
(2) Represents shares of common stock issuable by the Company upon exercise of Flow-through Warrants. Each Flow-through Warrant has a two-year term that ends on August 16, 2009 or November 16, 2009, as the case may be, and is exercisable at a price of $0.70 (CDN$0.70) per share.
(1) | Represents shares and warrants to be issued to the holders of Preferred Membership interests in VetaNova Solar Partners, LLC. |
(3) Represents shares of common stock issuable by the Company upon exercise of Unit Warrants. Each Unit Warrant has a two-year term that ends on August 16, 2009 or November 16, 2009, as the case may be, and is exercisable at a price of $0.60 (CDN$0.60) per share.
(4) Represents shares of common stock underlying Flow-through Compensation Options issued to the placement agent for private placements completed on August 16, 2007 and November 16, 2007. Each Flow-through Compensation Option is exercisable for a two-year period at a price of $0.52 (CDN$0.52) per share. In the case of the Flow-through Compensation Options, exercise of the option entitles the placement agent to one share of flow-through common stock and one-half of one common share purchase warrant exercisable at $0.70 (CDN$0.70) per whole share. Issuance of shares on a “flow through” basis entitles certain Canadian taxpayers to make use of certain investment tax credits. The shares listed in this row represent shares that are issuable upon exercise of the Flow-through Compensation Options.
(5) Represents shares of common stock underlying Unit Compensation Options issued to the placement agent for private placements completed on August 16, 2007 and November 16, 2007. Each Unit Compensation Option is exercisable at a price of $0.45 (CDN$0.45) per share. The options are exercisable for a two-year period, beginning on the closing dates of the respective private placements. In the case of the Unit Compensation Options, exercise of the option entitles the placement agent to one share of common stock and one-half of one common share purchase warrant exercisable at $0.60 (CDN$0.60) per whole share. The shares listed in this row represent shares that are issuable upon exercise of the Unit Compensation Options.
(6) The placement agent for the private placements completed on August 16, 2007 and November 16, 2007 received Unit Compensation Options exercisable at $0.45 (CDN$0.45) per option and Flow-through Compensation Options exercisable at $0.52 (CDN$0.52) per option. In both cases, the options are exercisable for a two-year period, beginning on the closing dates of the respective private placements. In the case of the Unit Compensation Options, exercise of the option entitles the placement agent to one share of common stock and one half-share purchase warrant execrable at $0.60 (CDN$0.60) per whole share. In the case of the Flow-though Compensation Options, exercise of the option entitles the placement agent to one share of flow-though common stock and one half-share (issued on a flow-though basis) purchase warrant execrable at $0.70 (CDN$0.70) per whole share. The shares listed in these rows represent shares that are issuable upon exercise of the underlying Unit Compensation Warrants and the underlying Flow-through Compensation Warrants.
- 8 -
(7) Represents shares of common stock underlying warrants of the Company. Each warrant is exercisable at $0.24 (CDN$0.24) per share until December 17, 2012.
(8) Represents shares underlying stock options issued pursuant to the 2006 Stock Option Plan. The maximum price shown in the table is the average of the exercise prices for such stock options.
(9) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-140674, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 2,823,049 shares of common stock issuable by the Company upon exercise of Flow-through Special Warrants.
(10) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-140674, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 668,436 shares of common stock issuable by the Company upon exercise of Unit Special Warrants.
(11) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-140674, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 197,613 shares of common stock underlying the Flow-through Compensation Warrants issued to two agents for the Company.
(12) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-140674, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 112,590 shares of common stock underlying Unit Compensation Warrants.
(13) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-142276, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 282,309 shares of common stock issuable by the Company upon exercise of Flow-through Special Warrants.
(14) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-142276, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 66,846 shares of common stock issuable by the Company upon exercise of Unit Special Warrants.
(15) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-142276, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 19,763 shares of common stock underlying the Flow-through Compensation Warrants issued to two agents for the Company.
(16) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-142276, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 4,680shares of common stock underlying Unit Compensation Warrants.
(17) This Registration Statement amends our registration statement on Form SB-2, Commission File No 333-137039, and pursuant to Rule 429 of the Securities Act of 1933, as amended, carries forward 9,543,364 shares of common stock.
(18) Represents shares of the Company’s common stock issuable upon exercise of Warrants at a price of $1.00 per share, with an expiry date of September 22, 2008.
(19) Represents shares of the Company’s common stock issuable upon exercise of Warrants with an expiry date of October 4, 2008 and is exercisable at a price of $2.00 per share.
(20) Represents shares of the Company issuable upon exercise of warrants with an expiry date of March 29, 2008, at an exercise price of $0.90.
- 9 -
(21) Represents shares of the Company issuable upon exercise of broker warrants with an expiry date of March 29, 2008, at an exercise price of $0.60.
(22) Represents shares of the Company issuable upon exercise of warrants underlying broker warrants with an expiry date of March 29, 2008, at an exercise price of $0.90.
(23) Represents shares of the Company issued for three property payments on the Marg Property on March 1, 2005, December 6, 2005 and December 6, 2006.
(24) Represents shares of the Company issued on August 5, 2005 in settlement of a demand promissory note.
(25) Represents shares of the Company issued on August 23, 2005 to an outside company and to a former officer for professional services settlement.
(26) Represents shares of the Company issued on August 25, 2005 to an outside company for professional services settlement.
(27) Represents shares of the Company issued on August 26, 2005 in a private placement.
(28) Represents shares of the Company issued on August 29, 2005 in a private placement.
(29) Represents shares of the Company issued on December 5, 2005 in a private placement.
(30) Represents shares of the Company issued on April 11, 2006 to a director upon exercising stock options granted under the 2003 Stock Option Plan.
(31) Represents shares of the Company issued on July 17, 2006 to an accredited investor upon exercise of warrants.
(32) Represents shares of the Company issued on September 7, 2006 to an officer upon exercising stock options granted under the 2003 Stock Option Plan.
(33) Represents shares of the Company issued on December 12, 2006 to a former officer upon exercising stock options granted under the 2003 Stock Option Plan.
(34) Represents shares of the Company issued on July 7, 2007 in settlement of a property payment on the Mount Hinton property.
(35) The Company previously paid $970.08 for the shares covered by registration statement number 333-137039, $361.00 for the shares covered by registration statement number 333-140674 and $35.49 for the shares covered by registration statement number 333-142276. On February 29, 2008 in connection with the filing of registration statement number 333-149459, the Company paid $179.15. In Amendment No. 1 we added 6,526,354 shares to the current registration statement which resulted in a fee of $246.93 which was remitted upon the filing of Amendment No. 1 on May 22, 2008.
The offering price has been estimated for the purpose of calculating the registration fee pursuant to Rule 457(c) based upon: (i) in the case of common stock, the closing sale price of the Company’s common stock on the OTC Bulletin Board® as of February 12, 2008 and (ii) in the case of convertible securities, the price paid by investors in private placements by the Company completed on August 16, 2007 and November 16, 2007. In the case of shares to be issued upon exercise of warrants, the offering price is based upon the exercise price of the warrants. U.S. dollar amounts reflected above are based upon the conversion ratio of US$1.00 equals CDN$1.0072 as of April 30, 2008, the date of the last available financials statements of the Company.
- 10 -
The Registrantregistrant hereby amends this Registration Statementstatement on such date or dates as may be necessary to delay its effective date until the Registrantregistrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended,l933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.determine
PROSPECTUS
- 11 -
PRELIMINARY PROSPECTUSSUBJECT TO COMPLETIONVETANOVA, INC.
Common Stock and Warrants
By means of this prospectus the Company is offering 7.5 shares of its common stock and 7.5 warrants for each Preferred Membership interest in VetaNova Solar Partners, LLC. Each warrant entitles the holder to purchase one share of the Company’s common stock at price of $0.20 per share at any time on or before September 20, 2022. The Company would issue 37,788,421 shares of common stock and 37,788,421 warrants if all Preferred Membership interests are exchanged for shares of the Company’s common stock and warrants.
The information inRegistration Statement, of which this prospectusProspectus forms a part, is not completeregistering the shares and warrants which may be changed. This prospectus is not an offerissued to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.members of VetaNova Solar Partners, as well as the shares issuable upon the exercise of the warrants.
YUKON GOLD CORPORATION, INC.
32,417,919 SHARESBY SELLING SHAREHOLDERS
The sellingRegistration Statement, of which this Prospectus forms a part, is also registering shares which may be sold by certain shareholders of Yukon Gold Corporation, Inc., a Delaware corporation (“Yukon Gold” or the “Company”) named in this prospectus are offering up to 32,417,919 shares of Yukon Gold’sCompany.
Our common stock par value $0.0001 per share (“Shares”). Our Shares areis traded onin the OTC Bulletin Board® (the “OTC”)over-the-counter market under the symbol “YGDC.” In addition, our Shares are traded on the Toronto Stock Exchange (the “TSX”) under the symbol “YK” and on the Frankfurt Stock Exchange under the symbol “W8Y.” The Company will not receive any“VTNA”. As of the proceeds of the sale of our Shares by the selling shareholders. We will pay all of the costs associated with this registration statement and prospectus. See “PLAN OF DISTRIBUTION.”
On August 18, 2008July 26, 2021 the closing price of our shares on the OTC was US$0.13 and the closing price of our shares on the TSX was CDN$0.14.
Before buying the shares of common stock carefully read this prospectus, especially the section entitled “Risk Factors.” The purchase of our securities involves a high degree of risk.was $0.16.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The information
In reviewing this Prospectus, you should carefully consider the matters described in the section titled “Risk Factors” beginning on page 5 of this prospectus is not complete and may be changed. The Selling Shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. Prospectus.
This prospectusProspectus is not an offer to sell, these securities and it is not solicitingor a solicitation of an offer to buy, these securities in any state where the offer or sale is not permitted.securities.
The date of this prospectusProspectus is ____, 2008.______, 2021.
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TABLE OF CONTENTS
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Indemnification | 20 | |
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Financial Statements for the year ended April 30, 2008 (audited)
2 |
Until ______________, 2008, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
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HistoryFORWARD LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve risks and Business. Our name is Yukon Gold Corporation, Inc. and we sometimes refer to ourselvesuncertainties. When used in this prospectus, as “Yukon Gold” or as “we,the words “plan,” “our,“target,” or “us.“anticipate,” We“believe,” “estimate,” “intend,” “expect” and similar expressions are an exploration stage mining company. Our objective isintended to exploitidentify such forward-looking statements. Forward-looking statements include, without limitation, the statements regarding our interest in the mineral claims in Yukon, Canada which we hold directlystrategy, future plans for development and through our Canadian wholly-owned subsidiary named “Yukon Gold Corp”. Our wholly-owned subsidiary is referred toproduction, future expenses and costs, future liquidity and capital resources, and future dividends. All forward-looking statements in this prospectus as “YGC.” We were incorporated in the state of Delaware on May 31, 2000. Our executive offices are at 55 York Street, Suite 401, Toronto, Ontario Canada M5J 1R7. Our telephone number is 416-865-9790 and our fax number is 416-865-1250. Our wholly-owned subsidiary, YGC, was incorporated on May 16, 2002 in the Province of Ontario, Canada and is licensed to do business in the Province of Yukon, Canada. All of our business activities are undertaken through YGC.
Risk Factors. You should read the “RISK FACTORS” section as well as the other cautionary statements throughout this prospectus so that you understand the risks associated with an investment in our securities. Any investment in our securities should be considered a high-risk investment because of the nature of mineral exploration and development. Only investors who can afford to lose their entire investment should invest in these securities.
Currency. References to dollars are to United States dollars (US$) unless otherwise indicated as being Canadian dollars (CDN$). As of August 18, 2008, the currency exchange rate was approximately US$1.00equals CDN$1.06 based upon information available athttp://www.bankofcanada.ca.to us on the date of this prospectus, and we assume no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties and there can be no assurance that such statements will prove to be accurate. Our actual results could differ materially from those discussed in this prospectus. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Risk Factors section of this prospectus.
3 |
Overview
We have a development stage company that plans to build and operate solar powered, state of the art, greenhouse facilities which will grow fruits and vegetables for distribution to local markets across the United States.We have entered into agreements to acquire approximately 157 acres in southern Colorado (“Avondale Complex”), which will be our first development project. As of the date of this Prospectus, we were not operating any solar powered greenhouses.
Our principal executive offices are located at 335 A Josephine St. Denver, Colorado 80206 and our telephone number is (303) 248-6883.
The Offering
By means of this prospectus we are offering 7.5 shares of our common stock and 7.5 warrants for each Preferred Membership interest in VetaNova Solar Partners, LLC. Each warrant entitles the holder to purchase one share of our common stock at a price of $0.20 per share at any time on or before December 31, 2022. We would issue 37,888,421 shares of common stock and 37,888,421 warrants if all Preferred Membership interests are exchanged for shares of our common stock and warrants.
Shares Outstanding: 353,724,144
Shares Outstanding after Offering: 499,748,134 (1)
(1) assumes
● | all Preferred Membership Interests in VetaNova Solar Partners are exchanged for shares of our common stock and warrants, and | |
● | all warrants issued by the Company pursuant to the Company’s private placement (55,612,900) and warrants issued to two unrelated third parties (14,634,288) are exercised. |
By means of this prospectus we are also registering shares which may be sold by certain shareholders of the Company.
Risk Factors: The securities offered by this prospectus involve a high degree of risk. See “Risk Factors” section of this prospectus for additional Risk Factors.
Implications of Being an Emerging Growth Company
We qualify as an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, or “JOBS Act.” An Emerging Growth Company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:
● | a requirement for quarterly and annual reports filed with the U.S. Securities and Exchange Commission (“SEC”) to have only two years of audited financial statements and only two years of related management’s discussion and analysis; | |
● | reduced disclosure concerning executive compensation arrangements; | |
● | exemption from the auditor attestation requirement in the assessment of the emerging growth company’s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002; and | |
● | No non-binding advisory votes on executive compensation or golden parachute arrangements. |
4 |
We have utilized some of these exemptions in this prospectus, which are also available to us as a smaller reporting company as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
In addition, Section 107 of the JOBS Act provides that an emerging growth company utilize the extended transition period provided in Section 7(a)(2)(b) of the Securities Act of 1933, as amended (the “Securities Act”) for complying with new or revised accounting standards. We are choosing to “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.
We could remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year ended April 30, 2008,in which annual gross revenue equals or exceeds $1.07 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recent financial statements,recently completed second fiscal quarter, or (iii) the currency exchange rate was approximately US$1.00 equals CDN$1.0072 based upon information available athttp://www.bankofcanada.ca. As manydate on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.
The price of our expenses are in Canadian dollars,common stock may be materially affected by a number of risk factors, including those summarized below:
The Company has no operating history with respect to its new business and may never be profitable.
Since the amounts at April 30, 2008 have been convertedCompany only recently began its new business, it is difficult for potential investors to US dollar equivalents based onevaluate the April 30, 2008 conversion rate for amountsCompany’s future prospects. The Company will need to raise enough capital to be paidable to fund its operations. There can be no assurance that the Company will be profitable or that the Company’s securities will have any value.
Any forecasts the Company makes concerning its operations may prove to be inaccurate. The Company’s prospects must be considered in light of the risks, expenses, and difficulties frequently encountered by companies in the future.early stage of development.
The Company needs capital to implement its business plan.
Expenses of Offering. We are paying all of the expenses relating to the registration of the selling shareholders’ shares. We will not pay any commissions or actual expenses of the sale of the shares by the selling shareholders.
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The following summary financial data should be read in conjunction with MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION and the audited CONSOLIDATED FINANCIAL STATEMENTS OF YUKON GOLD for the years ended April 30, 2008 and April 30, 2007, including the notes thereto contained elsewhere in this Prospectus.
SELECTED INFORMATION
SELECTED FINANCIAL INFORMATION
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| April 30, 2007 |
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Revenues |
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Net Loss |
| $ | 4,953,775 |
| $ | 3,703,590 |
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Loss per share-basic and diluted |
| $ | (0.19 | ) | $ | (0.20 | ) |
Total Assets |
| $ | 2,526,600 |
| $ | 4,225,107 |
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Total Liabilities |
| $ | 231,531 |
| $ | 272,083 |
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Cash dividends declared per share |
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DETERMINATION OF OFFERING PRICE
The offering price has been estimated solely for the purpose of calculating the registration fee payable to the Securities and Exchange Commission in connection with this prospectus.
We will likely be required to issue more common stock from treasury in order to raise additional capital. If common stock is issuedoperate. The Company will not receive any capital from this offering and as a result, will need to raise additionalthe capital orit needs in future offerings of its securities, proceeds from the exercise of the Company’s warrants, the sale and lease back of the Company’s greenhouse/ warehouse facilities or borrowings from private lenders. The Company does not know what the terms of any future capital raising may be, but any future sale of the Company’s equity securities will dilute the ownership of existing stockholders and could be at prices substantially below the market price of our common. The failure of the Company to obtain the capital which it willrequires may result in the dilutionslower implementation of the existing shareholders.
DESCRIPTION OF BUSINESSCompany’s business plan.
Yukon Gold explores
Our business and if warrantedresults of operations are dependent on the availability, skill and feasible, develops mining propertiesperformance of subcontractors.
We will use subcontractors to construct our greenhouse/ warehouse facilities. Accordingly, the timing and quality of our installations will depend on the availability and skill of our subcontractors. While we anticipate being able to obtain sufficient materials and reliable subcontractors, we do not have any contractual commitments with any subcontractors, and we can provide no assurance that skilled subcontractors will be available at reasonable rates. The inability to contract with skilled subcontractors at reasonable rates on a timely basis could have a material adverse effect on our business.
We may discover that our subcontractors have engaged in improper construction practices or have installed defective materials. When we discover these issues, we will use other subcontractors to make repairs as required by law. The costs of repairs in these instances may be significant and we may be unable to recover the costs of repairs from subcontractors, suppliers and insurers, which could have a material impact on our business. We may also suffer damage to our reputation from the actions of subcontractors, which are in areasbeyond our control.
5 |
Potential competitors could duplicate our business model.
There is no aspect of our business which is protected by patents, copyrights, trademarks, or trade names at this time. As a result, potential competitors could duplicate our business model with rich histories of past production and whose future potential requires a committed focus for a full realization of value. Yukon Gold is committed to moving projects diligently and efficiently towards production. We are an exploration stage company. little effort.
The Company has mineral claims locatedmay not be able to effectively manage its growth, which would impair our results of operations.
The Company intends to expand the scope of its operating activities significantly. If the Company is successful in executing its business plan, it will experience business growth that could place a significant strain on operations, finances, management, and other resources.
The ability to effectively manage growth may require the Mayo Mining DistrictCompany to substantially expand the capabilities of Yukon, Canada which we referadministrative and operational resources and to herein as (i)attract, train, manage, and retain qualified management and other personnel. There can be no assurance that the “Marg Property”,Company will be successful in recruiting and retaining new employees or “Marg Deposit,” an advanced stage copper/zinc/lead/silver/gold deposit and (ii) the “Mount Hinton Property,” bothretaining existing employees.
The Company cannot provide assurances that management will be able to manage this growth effectively. The failure to successfully manage growth could materially adversely affect its business, financial condition or results of which we hold through our wholly-owned subsidiary, YGC. operations.
The Company is actively seekingdependent on its management and reviewing other mining properties elsewhere in Canadathe loss of any of its officers could harm the Company’s business.
The Company’s future success depends largely upon the experience, skill, and contacts of the Company’s officers. The loss of the services to these officers may have a material adverse effect upon the Company’s business.
Our sole officer and director controls the voting of approximately 41% of our common stock.
John R. McKowen, our only officer and director, owns 88,107,690 shares of our common stock and controls the voting of 56,052,837 shares of common stock owned by VitaNova Partners, LLC (“VitaNova”). As a result, Mr. McKowen is able to exert a significant level of control over all matters requiring stockholder approval, including the election of directors, any amendment to our articles of incorporation and approval of mergers and other partstransactions requiring stockholder approval.
We may face business disruption and related risks from the recent pandemic of the world. Allnovel coronavirus 2019 (COVID-19) which could have a material adverse effect on our business.
Our business could be disrupted and materially adversely affected by the recent outbreak of COVID-19. As a result of measures imposed by the governments in affected regions, businesses and schools have been suspended due to quarantines intended to contain this outbreak. The spread of SARS CoV-2 from China to other countries has resulted in the Director General of the World Health Organization declaring COVID-19 a pandemic on March 11, 2020. International stock markets reflect the uncertainty associated with the slow-down in the economy. The reduced levels of international travel experienced since the beginning of January and the significant declines in the Dow Industrial Average were largely attributed to the effects of COVID-19. We are still assessing the impact COVID-19 may have on our exploration activitiesbusiness, but there can be no assurance that this analysis will enable us to avoid part or all of any impact from the spread of COVID-019 or its consequences, including downturns in business sentiment generally or in our sector in particular. The extent to which the COVID-19 pandemic and global efforts to contain its spread will impact our operations will depend on future developments, which are undertaken through YGC. highly uncertain and cannot be predicted at this time, and include the duration, severity and scope of the pandemic and the actions taken to contain or treat the COVID-19 pandemic.
As of the date of this prospectus we havethere was virtually no mineral reserves. There is no assurance that commercially viable mineral deposits exist on anypublic market for our common stock.
As a result, you may be unable to sell your shares of our mineral claimscommon stock.
6 |
Disclosure requirements pertaining to penny stocks may reduce the level of trading activity for our common stock.
Trades of the Company’s common stock are subject to Rule 15g-9 of the Securities and further exploration will be required before a final evaluation as to economic and legal feasibility is determined.
Description of Property
The Marg Property
The Marg Property consists of 402 contiguous mineral claims covering approximately 20,000 acres. AccessExchange Commission, which rule imposes certain requirements on broker/dealers who sell securities subject to the claim group is possible eitherrule to persons other than established customers and accredited investors. For transactions covered by helicopter, based in Mayo, Yukon, Canada, located approximately 80 kmthe rule, brokers/dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the southwesttransaction prior to sale. The Securities and Exchange Commission also has rules that regulate broker/dealer practices in connection with transactions in “penny stocks”. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security is provided by small aircraftthe exchange or system). The penny stock rules require a broker/ dealer, prior to a small airstrip located neartransaction in a penny stock not otherwise exempt from the Marg deposit. A 50 kilometer winter road from Keno Cityrules, to deliver a standardized risk disclosure document prepared by the property boundary was completedCommission that provides information about penny stocks and the nature and level of risks in 1997.the penny stock market. The camp sitebroker/dealer also must provide the customer with current bid and some equipment remain intact atoffer quotations for the site. Facilities atpenny stock, the Marg site include a fully equipped 12 to 15-man campcompensation of the broker/dealer and a D6 Caterpillar tractor for road buildingits salesperson in the transaction, and movementmonthly account statements showing the market value of drills.
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The claims,each penny stock held in the namecustomer’s account. The bid and offer quotations, and the broker/dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation.
You may have difficulty depositing your shares with a broker or selling shares of our wholly-owned subsidiary “Yukon Gold Corp,” are registeredcommon stock which you acquire in this offering.
Many securities brokers will not accept securities for deposits and will not sell securities which:
● | are considered penny stocks or | |
● | trade in the over-the-counter market |
Further, for a securities broker which will, under certain circumstances, sell securities which fall under any or all of the categories listed above, the customer, before the securities broker will accept the shares for deposit, must often complete a questionnaire detailing how the customer acquired the shares, provide the securities broker with an opinion of an attorney concerning the ability of the shares to be sold in the Mining Recorders Office in the Mayo Mining District of the Province of Yukonpublic market, and give us the right to explore and develop minerals from the property covered by the claims. These claims are tabulated below.
Marg Property Claimsheld byYukon Gold Corp.
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- 20 -
Marg Acquisition Agreement
In March of 2005, our wholly-owned Canadian subsidiary, YGC, acquired from Medallion Capital Corp. (“Medallion”) all of Medallion’s rights to purchase and develop the Marg Propertypay a “legal review” fee which consists of 402 contiguous mineral claims covering approximately 20,000 acres located in the central area of Yukon, Canada. The price paid by the Company was Medallion’s cost to acquire the interest. Medallion is owned and controlled by a former director of the Company, Stafford Kelley. The rights acquired by YGC arise under a Property Purchase Agreement between Medallion and Atna Resources Ltd. (“Atna”), hereinafter referred to as the “Marg Acquisition Agreement.” Under the terms of the Marg Acquisition Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333 common shares as a down payment. The Company made payments under the Marg Acquisition Agreement of $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the Company on December 12, 2005; $86,805 (CDN$100,000) cash and an additional 133,334 common shares of the Company on December 12, 2006 and $98,697 (CDN$100,000) in cash on December 12, 2007. The Company has agreed to make subsequent payments under the Marg Acquisition Agreement of $198,570 (CDN$200,000) in cash and/or common shares of the Company (or some combination thereof to be determined) on or before December 12, 2008. Upon the commencement of commercial production at the Marg Property (if possible), the Company will pay to Atna $992,851 (CDN$1,000,000) in cash and/or common shares of the Company, or some combination thereof to be determined.
Our expenditures for exploration on the Marg Property are as follows: On May 16, 2006 the Company accepted a proposed work program, budget and cash call schedule for the Marg Property totaling $1,674,866 (CDN$1,872,500) for the 2006 Work Program. On May 15, 2006 the Company paid $199,016 (CDN$222,500) to the contractor, on June 1, 2006 the Company paid $536,673 (CDN$600,000) to the contractor, and on July 20, 2006 the Company paid $357,782 (CDN$400,000) to the contractor. The fourth payment of $357,782 (CDN$400,000) was paid on August 20, 2006 and the fifth payment of $223,613 (CDN$250,000) paid on September 20, 2006. On April 2, 2007 the Company accepted a proposed work program, budget and cash call schedule for the Marg project totaling $3,026,916 (CDN$3,180,000) for the 2007 Work Program. The Company had approximately $515,561(CDN $550,000) on deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037 (CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000) being three of the four cash call payments. The fourth and final payment of $402,244 (CDN$380,000) was paid on August 15, 2007. On August 31, 2007 the Company re-allocated $537,864 (CDN$508,120), being the balance of the third cash call payment for the Mount Hinton 2007 Work Program from cash call funds previously allocated to the Marg Project. These re-allocated funds were not needed for the Marg Project. As of January 23, 2008, unused funds of $388,524 (CDN$390,000) were refunded by our work program manager to the Company.
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Exploration at Marg Property
The Marg property has had an extensive exploration history with numerous owners and work programs. The area was first staked in 1965 to follow-up anomalous results in a government stream sediment survey. The initial exploration was directed towards finding silver bearing veins but when none were discovered the claims were allowed to lapse. In 1982 the ground was re-staked by a consortium looking for “SEDEX” style lead-zinc mineralization and this resulted in the discovery of the Marg mineralization. In the following years, exploration consisted of geochemical and geophysical surveying, geological mapping, hand trenching and diamond drilling which progressively expanded the limits of the known mineralization. This work was done by various companies who entered into agreements to explore the ground or relinquish their interests. To date a total of 33,500 meters of diamond drilling has been performed on the Marg mineralization.
Yukon Gold started its exploration efforts in 2005 when 1,184.6 meters were drilled in four holes. Exploration continued in 2006 when nine holes totaling 2,986 meters were drilled. In 2007 3,304 meters in eleven holes were drilled and additional soil sampling was completed. The programs were managed by Archer Cathro & Associates (1981) and were designed to test the “down-dip” extent of the mineralization. In June of 2008 a drilling program to collect metallurgical samples and carry out additional exploration in the Marg deposit area was initiated, managed directly by the Company’s personnel. As of August 22, 2008 3,278 meters totaling 9 holes have been completed.
Two “NI: 43-101” compliant estimates on the Marg mineralization have been prepared. The first completed by P. Holbek (2005) used the polygonal method and in the second by G. Giroux and R. Carne (2007) used a block model method. The mineralization is contained in four zones with strike lengths from 650 metres to 1,200 metres. Results of these two estimates are tabulated below:
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Cut-Off |
| 0.5% Cu |
| 1.00% Cu |
| C$40 NSR |
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Mineralized Material Tonnes |
| 1,930,000 |
| 1,720,000 |
| 4,646,200 |
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% Copper |
| 1.84 |
| 1.97 |
| 1.80 |
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% Zinc |
| 4.34 |
| 4.59 |
| 4.77 |
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% Lead |
| 2.28 |
| 2.40 |
| 2.57 |
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Silver (g/t) |
| 56.66 |
| 59.72 |
| 65 |
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Gold (g/t) |
| 0.90 |
| 0.95 |
| 0.99 |
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All previous operators employed Chemex Labs in Vancouver for their analytical work. In Yukon Gold’s 2006 program, all core sampling, collection of geotechnical data and core logging was done on site. Mineralized intervals were split and one-half was sent to ALS Chemex Labs, North Vancouver, B.C. Blank samples consisting of barren limestone were routinely inserted into the sample stream. Duplicate samples collected by quartering core were inserted into the sample stream. Prepared pulps and coarse rejects were sent as check samples to Acme Analytical Laboratories Ltd. in Vancouver. Reanalysis for results greater than 1% copper, lead or zinc were routinely carried out. The drill core is stored on the property at the camp location.
- 22 -
At the laboratory, core samples were weighed, dried and crushed to 70% minus 2 mm, before a 250 g split was taken and pulverized to better than 85% minus 75 microns. A 10 gram split of the pulverized fraction was dissolved in aqua regia and analyzed for 50 elements by a combination of ICPMS and ICPAES techniques. Over limit copper, lead, zinc and silver values were determined using atomic absorption spectroscopy (AAS). A 30 gram split was analyzed for gold with a fire assay preparation and AAS finish. ALS Chemex operates according to the guidelines set out in ISO/IEC Guide 25 “General requirements for the competence of calibration and testing laboratories” and the company is certified to ISO 9002 by KPMG in Canada and other countries. Duplicate analyses were performed by Acme Analytical Laboratories in Vancouver using a process similar to Chemex.
For the 2008 program samples collected for the metallurgical test are prepared by splitting the core in half and subsequently splitting the remaining core to prepare a ¼ split. Individual samples of approximately one metre from mineralized intersections were prepared in this manner. Both the ½ split core and ¼ split-core samples were sent to G&T Metallurgical Services Ltd. of Kamloops British Columbia. The ¼ split core was analyzed by G&T Metallurgical Services for Cu, Pb and Zn. A composite of individual samples which represents the estimated grade of the resource is being prepared for the metallurgical test work. G&T Metallurgical Services Ltd. is an ISO-9000:2000 certified laboratory with BSi registration. As a check on analyses and to provide Ag and Ag analyses, the coarsely crushed rejects from the initial ¼ split core sample preparation by G&T Metallurgical Services Ltd. were sent to ALS Chemex Labs in Vancouver British Columbia to be analyzed for Cu, Pb, Zn, Ag and Au using the identical methods as used in 2006 and 2007. In addition as a further check on analyses separate ¼ splits of core from intersections not destined for the metallurgical composite were sent separately to G&T Metallurgical Services Ltd and ALS Chemex.
Though the property is without known mineral reserves, Yukon Gold believes that exploration potential within the Marg Property is good. Presently the hydroelectric power grid terminates at Keno City some 50km to the southwest and water is available from the Keno Ladue River which flows through the property.
During the summer of 2006, we undertook an exploration program at the Marg Property to extend the currently known mineralization toward a target of 9 to 10 million tons, which we believe to be the required threshold to proceed with the next stage which includes a definitive feasibility study. The drilling results of the nine holes drilled at the Marg Property in the summer of 2006 are generally consistent with the previous results from prior drilling programs reflected in the Company’s mineral report. We continue to hit mineralized material to the west of known resources.
In December of 2007, Yukon Gold announced the results of the 2007 diamond drill program. With a skid mounted rig, 2,704 metres were drilled in 7 holes to test the extension of the known mineralization.
- 23 -
Highlights of the drill results are outlined below:
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| Horizon |
| Depth |
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| Interval |
| Weighted Average Assay Results | ||||||||
Hole |
| Horizon |
| from |
| To |
| metres |
| Cu (%) |
| Zn (%) |
| Pb (%) |
| Ag (g/t) |
| Au (g/t) |
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M07-097 |
| D2 |
| 346.62 |
| 346.95 |
| 0.33 |
| 2.7 |
| 5.8 |
| 1.9 |
| 67.1 |
| 0.47 |
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| D1 |
| 349.2 |
| 356.5 |
| 7.3 |
| 2.7 |
| 4.4 |
| 2.1 |
| 60.3 |
| 0.88 |
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| A1 |
| 422.7 |
| 423.0 |
| 0.3 |
| 1.3 |
| 3.1 |
| 1.4 |
| 56.6 |
| 0.22 |
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M07-100 |
| B5 |
| 355.9 |
| 359.1 |
| 3.2 |
| 1.2 |
| 2.9 |
| 1.1 |
| 30.4 |
| 0.36 |
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| B4 |
| 376.7 |
| 379.4 |
| 2.7 |
| 1.0 |
| 4.3 |
| 1.8 |
| 34.4 |
| 0.80 |
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M07-101 |
| D1 |
| 338.7 |
| 339.4 |
| 0.7 |
| 3.0 |
| 5.7 |
| 1.7 |
| 44.2 |
| 0.39 |
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| B4 |
| 415.2 |
| 415.8 |
| 0.6 |
| 0.5 |
| 1.4 |
| 0.6 |
| 14.9 |
| 0.06 |
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| B3 |
| 426.1 |
| 426.7 |
| 0.6 |
| 0.2 |
| 1.0 |
| 0.4 |
| 8.5 |
| 0.04 |
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| B1 |
| 437.8 |
| 439.1 |
| 1.3 |
| 1.1 |
| 3.9 |
| 1.6 |
| 54.2 |
| 0.31 |
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M07-107 |
| D2 |
| 345.4 |
| 346.1 |
| 0.7 |
| 2.7 |
| 7.9 |
| 3.8 |
| 63.8 |
| 0.72 |
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| D2 |
| 347.9 |
| 348.5 |
| 0.6 |
| 0.6 |
| 0.7 |
| 0.5 |
| 23.4 |
| 0.52 |
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| D1 |
| 356.3 |
| 357.5 |
| 1.2 |
| 1.5 |
| 3.1 |
| 1.0 |
| 31.2 |
| 0.15 |
This drill program continued to expand the limits of the Marg mineralization down dip and along strike, which is very encouraging.
An additional 603 meters were drilled with a heli-portable rig to test outlying targets defined by soil geochemical sampling and the VTEM survey which was flown over the property in 2006. Two of these holes were lost in deep overburden. A third hole, offset from the Jane Zone, intersected a carbonate rich exhalative horizon. Such exhalative horizons are often associated with mineralized sulphide horizons and this is encouraging. The last hole intersected strata with thin lamellae of pyrite and pyrrhotite but with no copper or zinc values. There still are 17 other VTEM anomalies identified on the property that are associated with soil geochemical anomalies which have to be drill tested.
In February 2008, Yukon Gold announced the results of an internal review of the 100% owned Marg Deposit dated February 1, 2008.
The internal review postulates that a positive production decision might be feasible based on a 2700 tonne per day mining and processing operation over a minimum mine life of seven (7) years. The internal review, amongst other items, recommends metallurgical test work and further exploration to expand the resource base which will provide additional mine life.
- 24 -
On March 10, 2008 the Company entered into a contract with a global mining consultancy business for a scoping study and to prepare a report pursuant to the terms of Canadian National Instrument 43-101, regarding the Marg Deposit at an estimated cost of between $139,000 (CDN$140,000) and $148,928 (CDN$150,000). The foregoing internal review was based on the 43-101 Technical Report by Carne/Giroux, July 2007, with “indicated” resources of 1.72M tons of 1.97% Copper, 2.40% Lead, 4.59% Zinc, 59.72g/t Silver, 0.95g/t Gold and “inferred” resources of 4.8M tons of 1.81% Copper, 2.28% Lead, 4.64% Zinc, 54.47g/t Silver, 0.77g/t Gold at a 1% copper cut off. This report also expressed the belief that exploration potential of the Marg Deposit is very high.
Again, the reader is cautioned that the terms “indicated” and “inferred” are not terms that are recognized by the SEC’s guidelines for disclosure of mineral properties; however, they are recognized defined terms under Canadian disclosure guidelines. Generally, an “indicated” or “inferred” estimate does not rise to the level of certainty required by SEC guidelines. Also, the internal review was based on comparisons with proximate deposits and associated feasibility studies at current metal prices, estimated trucking and shipping costs, industry treatment and refining costs, average metallurgical recoveries and concentrate grades from five VMS deposits. The internal review has not been analyzed by an independent Qualified Person and therefore the results of this review should not be relied upon. Yukon Gold believes that the internal review provides an indication of the potential of the Marg Deposit and is relevant to ongoing exploration.
- 25 -
The Mount Hinton Property
The Mount Hinton Property consists of 273 mineral claims covering approximately 14,000 acres in the Mayo Mining District of Yukon, Canada. Our claims, held in the name of our wholly-owned subsidiary, “Yukon Gold Corp” are registered in the Mining Recorders Office in the Mayo Mining District of the Province of Yukon, Canada and give us the right to explore and develop minerals from the property covered by the claims. The claims are located adjacent to the Keno Hill Mining Camp, approximately 6 miles southeast of Keno City and about 37 miles northeast of the village of Mayo Yukon, Canada.
For a list of the Mount Hinton Claims held by Yukon Gold, see “LIST OF MOUNT HINTON CLAIMS.”
Agreement with Hinton Syndicate
Our wholly-owned Canadian subsidiary, YGC, holds an option from the Hinton Syndicate (the “Hinton Option Agreement”), a private syndicate consisting of four individuals, with whom we have an agreement to acquire a 75% interest in the 273 mineral claims covering approximately 14,000 acres in the Mayo Mining District located in Yukon, Canada.
YGC must make scheduled cash payments and perform certain work commitments to earn up to a 75% interest in the mineral claims, subject to a 2% net smelter return royalty in favor of the Hinton Syndicate. The terms of the Hinton Option Agreement are outlined below. The Hinton Option Agreement was entered into in July of 2002 and amended as of July 7, 2005.
- 26 -
The schedule of Property Payments and Work Programs, and the status of payment as disclosed in our annual audited financial statements for the year ended April 30, 2008 is as follows:
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WORK PROGRAM-expenditures to be incurred in the following periods;
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- 27 -
Provided all Property Payments have been made that are due prior to the Work Program expenditure levels being attained, YGC shall have earned a:
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YGC earned a 50% interest in the claims covered by the Hinton Option Agreement as at October 31, 2007. In some cases, payments made to service providers include amounts advanced to cover the cost of future work. These advances are not loans but are considered “incurred” exploration expenses under the terms of the Hinton Option Agreement. Section 2.2(a) of the Hinton Option Agreement defines the term, “incurred” as follows: “Costs shall be deemed to have been “incurred” when YGC has contractually obligated itself to pay for such costs or such costs have been paid, whichever should first occur.” Consequently, the term, “incurred” includes amounts actually paid and amounts that YGC has obligated itself to pay. Under the Hinton Option Agreement there is also a provision that YGC must have raised and have available the Work Program funds for the period from July 7, 2005 to December 31, 2006, by May 15 of 2006. This provision was met on May 15, 2006.
All Property Payments and Work Program expenditures due as of the date of this prospectus have been made and incurred.
The Hinton Option Agreement contemplates that upon the earlier of: (i) a production decision or (ii) investment of $4,906,610 (CDN$5,225,000) or (iii) YGC has a minority interest and decides not to spend any more money on the project, YGC’s relationship with the Hinton Syndicate will become a joint venture for the further development of the property. Under the terms of the Hinton Option Agreement, the party with the majority interest would control the joint venture. Once the 75% interest is earned, as described above, YGC has a further option to acquire the remaining 25% interest in the mineral claims for a further payment of $4,964,257 (CDN$5,000,000).
The Hinton Option Agreement provides that the Hinton Syndicate receive a 2% “net smelter returns royalty.” In the event that we exercise our option to buy the entire interest of the Hinton Syndicate (which is only possible if we have reached a 75% interest, as described above) then the “net smelter return royalty” would become 3% and the Hinton Syndicate would retain this royalty interest only. The “net smelter returns royalty” is a percentage of the gross revenue received from the sale of the ore produced from our mine less certain permitted expenses.
The Hinton Option Agreement entitles the Hinton Syndicate to recommend for appointment (but not nominate) one member to the board of directors of Yukon Gold.
The Hinton Syndicate members each have the option to receive their share of property payments in stock of Yukon Gold at a 10% discount to the market. YGC and Yukon Gold also have the option to pay 40% of any property payment due after the payment on January 2, 2006 with common stock of Yukon Gold. As of July 7, 2006, Yukon Gold issued to the Hinton Syndicate 43,166 shares of its common stock, based upon a valuation adopted by the Board of Yukon Gold of $1.24 (CDN$1.39) per share, as partial payment of the July 7, 2006 Property Payment. On July 7, 2006 the Company issued 43,166 common shares and paid $80,501 (CDN$90,000) in cash in settlement of the property payment due on July 7, 2006 on the Mount Hinton Property. The shares represented 40% of the total $134,168 (CDN$150,000) payment and were valued at $1.24 (CDN$1.39) each. On July 7, 2007 the Company issued 136,364 common shares in settlement of a property payment on the Mount Hinton property. The shares represent $57,252 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.42 (CDN$0.44) each. The balance 60% payment was paid in cash. On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.126 (CDN$0.126) each. The Company paid the balance of the property payment, $89,537 (CDN$90,000), in cash.
- 28 -
The Hinton Option Agreement pertains to an “area of interest” which includes the area within ten kilometers of the outermost boundaries of the 273 mineral claims, which constitute our mineral properties. Either party to the Hinton Option Agreement may stake claims outside the 273 mineral claims, but each must notify the other party if such new claims are within the “area of interest.” The non-staking party may then elect to have the new claims included within the Hinton Option Agreement. As of December 11, 2006, there were an additional 24 claims staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement. Subsequent to April 30, 2008 there were an additional 18 claims staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement.
The Hinton Option Agreement provides both parties (YGC and the Hinton Syndicate) with rights of first refusal in the event that either party desires to sell or transfer its interest.
Under the Hinton Option Agreement, the Hinton Syndicate is responsible for any environmental liability claims arising from the status of the property prior to the effective date of the Hinton Option Agreement.
Under the terms of the Hinton Option Agreement three of the syndicate members are entitled to bid on work we propose to carry out and if their price is competitive they are entitled to do the work. There is no requirement in the Hinton Option Agreement that these parties perform exploration work.
Exploration at the Mount Hinton Property
Yukon Gold started its exploration efforts on the property in 2002 and Archer Cathro & Associates (1981) Limited was retained to manage this work. Initially this consisted of geochemical soil sampling, prospecting, limited hand trenching and re-sampling of old workings as well as minor bulldozer trenching, excavator trenching and road building. In 2006 heavy equipment was used to excavate trenches and prepare drill pads. Two reverse circulation drill holes were also attempted. The drill was unable to complete either due to a combination of operator inexperience and mechanical problems and the drill program was terminated.
Though the property is without known mineral reserves, Yukon Gold believes that exploration potential within the Mount Hinton Property is good. Presently there are no standing facilities or infrastructure on the property. The hydroelectric power grid terminates at Keno City, approximately 10km to the west and water is available from the various creeks that flow from the property. Mount Hinton has elevations of approximately 6,500 ft. above sea level. Our ability to conduct surface exploration at this latitude and elevation is limited to the period each year from late May to early October.
During the summer of 2006, we undertook an exploration program to delineate the vertical and lateral extent of some of the known vein structures at the site utilizing a reverse circulation drill and to carry out the geochemical surveys, prospecting and trenching that would help identify additional mineralized targets for future drilling and exploration programs. A second objective of the summer 2006 exploration program was to determine whether it would be more effective and feasible to evaluate the deposits by diamond drilling from an underground adit/ramp and where best to locate this underground exploration if feasible.
- 29 -
The 2006 summer program commenced on July 5, 2006 and was terminated on August 20, 2006 due to mechanical problems with the drilling equipment and difficulties in drilling through thick overburden. Prior to termination of the program, over 3000 soil samples were taken to identify potentially mineralized targets in unexplored areas of the property but generally in the headwaters of successful placer mining operations. In addition, at least six new veins were exposed or partially exposed by road construction during this year’s program. New road construction totaling 3.2 km created direct access to new surface drill sites and to a potential portal site from which underground exploration and diamond drilling could be considered.
On November 28, 2007, Yukon Gold announced the results of its 2007 trenching program at the Mount Hinton Property. Five trenches were excavated with heavy equipment to a maximum depth of 5m, for a combined length of 1.39km. Four of the trenches were located in the floor of McNeil Gulch and sited to be along strike from known veins exposed on the north face of Mount Hinton and a newly discovered vein on the ridge opposite Mount Hinton. The trenches are approximately a kilometre from any previously known veins and vary between 50m and 500m apart.
Trench #4 exposed a highly mineralized vein that has a weighted average grade of 1.27g/t Au, 116g/t Ag and 1.7% Pb over 3.1m of chip sampling. Grab samples of the coarse grained galena, arsenopyrite and tetrahedrite contain 2.25, 2.67, 3.92g/t Au and 6,900 3,900 11,397g/t Ag respectively.
These trenches, in an area that was never previously tested, are encouraging and indicate that the mineralized system at Mount Hinton has a considerably longer strike extent than previously thought. Veins now have been found over a two kilometer strike length.
In February of 2008 the Company elected to defer exploration work commitments in 2008 on the Mount Hinton property into 2009, as it is permitted to do under the Hinton Option Agreement.
REGULATIONS GOVERNING MINING IN CANADA
GOVERNING LAW
The mining industry in Canada operates under both federal and provincial or territorial legislation governing the exploration, development, production and decommissioning of mines. Such legislation relates to such matters as the method of acquisition and ownership of mining rights, labor, health and safety standards, royalties, mining and income taxes, exports, reclamation and rehabilitation of mines, and other matters. The mining industry in Canada is also subject to legislation at both the federal and provincial or territorial levels concerning the protection of the environment. Legislation imposes high standards on the mining industry to reduce or eliminate the effects of waste generated by extraction and processing operations and subsequently deposited on the ground or emitted into the air or water. The design of mines and mills, and the conduct of extraction and processing operations, are subject to regulatory restrictions. The exploration, construction, development and operation of a mine, mill or refinery require compliance with environmental legislation and regulatory reviews, and the obtaining of land use and other permits, water licenses and similar authorizations from various governmental agencies. Legislation is in place for lands under federal jurisdiction or located in certain provinces and territories that provide for the preparation of costly environmental impact assessment reports prior to the commencement of any mining operations. These reports require a detailed technical and scientific assessment as well as a prediction of the impact on the environment of proposed mine exploration and development.
- 30 -
Failure to comply with the requirements of environmental legislation may result in regulatory or court orders being issued that could result in the cessation, curtailment or modification of operations or that could require the installation of additional facilities or equipment to protect the environment. Violators may be required to compensate those suffering loss or damage by reason of mining activities and the violators, including our officers and directors, may be fined or, in some cases imprisoned if convictedcan exceed $1,000.
For these reasons, investors in this offering may have difficulty selling shares of our common stock.
We are an offense under such legislation. ProvincialEmerging Growth Company, subject to less stringent reporting and territorial mining legislation establishesregulatory requirements forof other publicly held companies and this status may have an adverse effect on our ability to attract interest in our common stock.
We are an Emerging Growth Company as defined in the decommissioning, reclamationJOBS Act. As long as we remain an Emerging Growth Company, we may take advantage of certain exemptions from various reporting and rehabilitation of mining propertiesregulatory requirements that are closed. Closure requirements relateapplicable to the protection and restoration of the environment and the protection ofother public safety. Some former mining properties must be managed for a long time following closure in order to fulfill regulatory closure requirements. The cost of closure of existing and former mining properties and, in particular, the cost of long-term management of open or closed mining properties can be substantial.
Mineral Exploration is subject to the Quartz Mining Act, the Quartz Mining Land Use Regulations, the Territorial Lands (Yukon) Act and the Yukon Environmental and Socioeconomic Assessment Act and Regulations as well as other Federal and Territorial Legislation. Additional permits relating to this legislationcompanies that are not emerging growth companies. We cannot predict if investors will be required before commencing mining operations at the Mount Hinton Property or the Marg Property
The Marg Property is surrounded by Category A lands of the First Nation of Na Cho Nyak Dun. An agreement will have to be reached with the First Nation of Na Cho Nyak Dun for any activity on its land.
With respect to the legislation, rules and regulations referred to above, we believe that we, and the Mount Hinton Property and the Marg Property, are currently in compliance in all material respects with applicable legislation, rules and regulations.
The Company does not foresee having to expend material amounts in order to comply with environmental laws during the exploration phase of its operations. The Company is obligated to restore surface disturbances created by exploration. These restoration efforts typically involve the back filling of trenches, pits, or other excavations created for purposes of exploration.
Underground exploration, which the Company contemplates in the future, will require additional cost related to the storage of excavated material. Until the Company knows the amount of material it will have to store, it cannot estimate this cost. There will be material costs of environmental compliance if the Company develops a mine in the future. However, the Company cannot reasonably estimate that environmental compliance cost at this time.
We have carried out all reclamation work, required by applicable regulations, wherefind our exploration disturbed the surface of the ground and to the best of our knowledge we are in full compliance with all rules and regulations.
It is not possible to estimate the cost of meeting the rules and regulations for a mining operation at this time. Those costs will only be determined when a mine plan and the required studies are completed to apply for a mining permit.
GOVERNMENT PERMITTING
The Company is committed to complying, and to its knowledge, is in compliance, with all governmental and environmental regulations. Permits from a variety of regulatory authorities are required for many aspects of mine operation and reclamation. Our exploration work is subject to the Mining Land Use Regulations of the Yukon Quartz Mining Act. This Act requires us to obtain permits prior to performing significant exploration programs. We are currently conducting exploration under a Class III Permit LQ002222 which is valid until October 30, 2012 for the Marg Property and a Class III Permit LQ00242 which is valid until August 18, 2013 for the Mount Hinton Property No other permits are required at this time or for the exploration work contemplated in the foreseeable future. Further permitting will be requiredcommon stock less attractive if we proposechoose to commence a mining operation, but cannot be applied for until ore reserves calculations and a mine plan are prepared.
- 31 -
The Company cannot predict the extent to which future legislation and regulation could cause additional expense, capital expenditures, restrictions, and delays in the development of the Company’s Canadian properties, including those with respect to mining claims. The Company’s activities are not only subject to extensive federal and territorial regulations controlling the mining of and exploration for mineral properties, but also the possible effects of such activities upon the environment. Streams draining the property make their way to the Mayo River the Stewart River, both of which contain wildlife. We will be obligated to take steps to ensure that such streams draining the properties do not become contaminatedrely on these exemptions. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our activities on the property. We are not aware of any environmental problems on the property as of the date of this prospectus. We have commenced the required baseline studies of drainage courses originating oncommon stock and our property in anticipation of underground development.stock price may be more volatile.
7 |
COPPER PRICE VOLATILITYMARKET FOR OUR COMMON STOCK
The volatility of the market price of copper
Our common stock is illustrated by thequoted on over-the-counter market. The following table which sets forth, for the periods indicated, the high and low of the London PM (afternoon) fix of theclosing sales price of copper in U.S. dollars per ounce (rounded to the nearest dollar), as published by Kitco Base Metals Company of Canada at www.Kitcometals.com, Copper Prices per pound (US$).
- 32 -
On August 19, 2008 the price of copper on the spot market was $3.4736 per pound according to www.kitcometals.com
Our fiscal year end is April 30.
Our transfer agent is Equity Transfer and Trust Services, Inc. with offices at 200 University Avenue, Suite 400, Toronto, Ontario M5H 4H1, phone number 416-361-0152, as transfer agent for our shares of common stock. The transfer agent is responsible for all record-keeping and administrative functions in connection with the common shares of stock.
We have two full-time employees, our Corporate Secretary and our Chief Administrative Officer. We rely primarily upon consultants for certain services. Our President and Chief Executive Officer, our Chief Financial Officer, our Vice President - Corporate Development and our Vice President - Exploration are employed as consultants. Our Chief Executive Officer provides services on a full-time basis. Our Chief Financial Officer provides services on an “as needed” basis. We are not subject to a union labor contract or collective bargaining agreement.
On October 28, 2003, we adopted the 2003 Stock Option Plan (the “2003 Plan”) under which our officers, directors, consultants, advisors and employees may receive stock options. The aggregate number of shares of common stock thatas provided by OTC Markets Group Inc. These prices reflect inter-dealer prices, without retain mark-up or commission, and may not represent actual transactions.
Quarter Ended | High | Low | ||||||
June 30, 2021 | $ | $0.70 | $ | 0.07 | ||||
March 31, 2021 | 0.08 | 0.008 | ||||||
December 31, 2020 | 0.30 | 0.0001 | ||||||
September 30, 2020 | 0.31 | 0.11 | ||||||
June 30, 2020 | 0.15 | 0.12 | ||||||
March 31, 2020 | 0.58 | 0.12 | ||||||
December 31, 2019 | 0.58 | 0.10 | ||||||
September 30, 2019 | 0.60 | 0.30 | ||||||
June 30, 2019 | 0.67 | 0.31 | ||||||
March 31, 2019 | 0.99 | 0.65 |
Holders of our common stock are entitled to receive dividends as may be issued under the 2003 Plan is 5,000,000. Options granted under the 2003 Plan will were either “incentive stock options”, intended to qualify as such under the provisions of section 422 of the Internal Revenue Code of 1986, as from time to time amended (the “Code”) or “unqualified stock options”. The 2003 Plan is administereddeclared by the Board of Directors. The Board of Directors is not restricted from paying any dividends but is not obligated to declare a dividend. No cash dividends have ever been declared and it is not anticipated that cash dividends will ever be paid.
On May 23, 2005, Yukon Gold filed a registration statement on Form S-8 with the SEC pursuant to which it registered 3,300,000 shares of common stock reserved for issuance upon exercise of options granted pursuant to the 2003 Plan. On February 10, 2006 the board of directors adopted a policy of not accepting promissory notes from option holders as payment for the exercise of options.
8 |
The Company adopted a new Stock Option Plan at its shareholders meeting on January 19, 2007 (the “2006 Stock Option Plan”). The Company cannot issue any further options under the 2003 Plan. The purpose of the 2006 Stock Option Plan is to develop and increase the interest of certain Eligible Participants (as defined below) in the growth and development of the Company by providing them with the opportunity to acquire a proprietary interest in the Company through the grant of options (“Stock Options”) to acquire Shares.
Under the 2006 Stock Option Plan, Stock Options may be granted to Eligible Participants or to any registered savings plan established for the sole benefit of an Eligible Participant or any company which, during the term of an option, is wholly-owned by an Eligible Participant. The term “Eligible Participant” includes directors, senior officers and employees of the Company or an Affiliated Entity (as defined below) and any person engaged to provide services under a written contract for an initial, renewable or extended period of twelve months or more (a “Consultant”), other than services provided in relation to a distribution of securities, who spends or will spend a significant amount of time on the business and affairs of the Company and who is knowledgeable about the business and affairs of the Company. An “Affiliated Entity” means a person or company that is controlled by the Company.
- 33 -
The 2006 Stock Option Plan is administered by the board of directors of the Company. At the option of the board, it may be administered by a committee appointed by the board of directors for that purpose.
Upon adoption in 2006, the aggregate number of Shares which could be issued under the 2006 Stock Option Plan was limited to 2,000,000 Shares, then representing approximately 10.63% of the then currently issued and outstanding Shares On March 18, 2008 at the 2008 Annual and Special Meeting of Shareholders, the shareholders of the Company approved an amendment to the 2006 Stock Option Plan increasing the number of Shares reserved for issuance thereunder from 2,000,000 to 2,899,044, representing approximately 10% of the issued and outstanding Shares. The 2006 Stock Option Plan was also amended to include a provision requiring shareholder approval for any future increase in the maximum number of Shares reserved for issuance thereunder.
Any Stock Option granted under the 2006 Stock Option Plan which has been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan, effectively resulting in a re-loading of the number of Shares available for grant under the 2006 Stock Option Plan. Any Shares subject to an option granted under the 2006 Stock Option Plan which for any reason is surrendered, cancelled or terminated or expires without having been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan.
Under the 2006 Stock Option Plan, at no time shall: (i) the number of Shares reserved for issuance pursuant to Stock Options granted to any one optionee exceed 10% of the Total Shares; (ii) the number of Shares, together with all security based compensation arrangements of the Company in effect, reserved for issuance pursuant to Stock Options granted to any “insiders” (as that term is defined under theSecurities Act (Ontario)) exceed 10% of the total number of issuedManagement’s Discussion and outstanding Shares. In addition, the number of Shares issued to insiders pursuant to the exercise of Stock Options, within any one year period, together with all security based compensation arrangements of the Company in effect, shall not exceed 10% of the total number of issued and outstanding Shares.Analysis
The purchase price (the “Price”) per Share under each Stock Option shall be determined by the board of directors or a committee, as applicable. The Price shall not be lower than the closing market price on the TSX, or another stock exchange where the majorityFinancial Condition and Results of the trading volume and value of the Shares occurs, on the trading day immediately preceding the date of grant, or if not so traded, the average between the closing bid and asked prices thereof as reported for the trading day immediately preceding the date of the grant; provided that if the Shares have not traded on the TSX or another stock exchange for an extended period of time, the “market price” will be the fair market value of the shares at the time of grant, as determined by the board of directors or committee. The board of directors or committee may determine that the Price may escalate at a specified rate dependent upon the date on which an option may be exercised by the Eligible Participant.Operation
Options shall not be granted for a term exceeding ten years (or such shorter or longer period as is permitted by the TSX) (the “Option Period”). Options may be exercised by an Eligible Participant in whole at any time, or in part from time to time, during the Option Period, subject to the provisions of the 2006 Stock Option Plan. Options granted under the 2006 Stock Option Plan may be assigned or otherwise transferred by a participant pursuant to a will, or by the laws of descent and distribution, or as otherwise permitted under the 2006 Stock Option Plan. Options granted under the 2006 Stock Option Plan may vest at the discretion of the board of directors of the Company or committee, as applicable.
- 34 -
The directors of the Company or committee, as applicable, may from time to time amend the 2006 Stock Option Plan, without further approval of the shareholders of the Company, subject to pre-clearance with the TSX and compliance with the rules of the TSX and any other regulatory authority having jurisdiction over the securities of the Company, to the extent that such amendments relate to:
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The directors of the Company or committee, as applicable, may terminate the 2006 Stock Option Plan subject to pre-clearance with the TSX and compliance with the rules of the TSX and any other regulatory authority having jurisdiction over the securities of the Company.
In the eventResults of the death of a participant prior to an option’s expiry date, the option may be exercised by the legal representatives of such participant at any time up to and including the date which is the first anniversary of the date of death of such participant or the expiry date of such option, whichever is the earlier, after which the option shall in all respects cease and terminate. In the event a participant is discharged as an employee or senior officer of the Company or an Affiliated Entity by reason of a wilful and substantial breach of such participant’s employment duties, all options granted to such participant under the 2006 Stock Option Plan which are then outstanding (whether vested or unvested) shall cease and terminate in accordance with the provisions of the 2006 Stock Option Plan. In the event of a termination of employment or engagement of a participant (including the expiry of an agreement or engagement between the Company and a Consultant) other than in the event of death, such participant may exercise each option then held by such participant under the 2006 Stock Option Plan at any time up to and including the 90th day (or such later date as the board of directors or committee in its sole discretion may determine) following the effective date upon which the participant ceases to be an Eligible Participant or the expiry date of such option, whichever is earlier, after which the option shall in all respects cease and terminate.Operations
On January 19, 2007, the shareholders of the Company approved, subject to regulatory approval, the extension of 2,064,000 options held by all current officers, directors, consultants and employees in the 2003 Stock Option Plan and the adding of an additional 2,000,000 common shares of stock to the 2006 Stock Option Plan. The TSX approved the 2006 Stock Option plan on March 9, 2007.
Options shall not be granted for a term exceeding ten years (or shorter or longer period as is permitted by the TSX) (the "Option Period").Year Ended December 31, 2020
- 35 -
The following summarizes options outstanding as at April 30, 2008:
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|
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| Number of shares | |||||
|
| Option Price |
|
| ||||||
Expiry Date |
| Per Share |
|
| 2008 |
| 2007 | |||
|
|
|
| |||||||
15-Dec-09 |
| $ | 0.75 |
|
| 250,000 |
|
| 250,000 |
|
5-Jan-10 |
| $ | 0.75 |
|
| 12,000 |
|
| 60,000 |
|
28-Jun-10 |
| $ | 0.55 |
|
| 490,000 |
|
| 490,000 |
|
15-Apr-08 |
| $ | 0.58 |
|
| — |
|
| 20,000 |
|
15-Aug-10 |
| $ | 0.45 |
|
| 62,500 |
|
|
|
|
13-Dec-10 |
| $ | 1.19 |
|
| 576,000 |
|
| 1,026,000 |
|
13-Dec-10 |
| $ | 1.19 |
|
| 88,000 |
|
| 88,000 |
|
20-Jan-11 |
| $ | 0.85 |
|
| 150,000 |
|
| 150,000 |
|
20-Mar-12 |
| $ | 0.43 |
|
| — |
|
| *250,000 |
|
28-Mar-12 |
| $ | 0.41 |
|
| — |
|
| **150,000 |
|
28-Sep-12 |
| $ | ***0.38 |
|
| 200,000 |
|
|
|
|
28-Sep-12 |
| $ | ***0.39 |
|
| 100,000 |
|
|
|
|
18-Dec-12 |
| $ | ***0.24 |
|
| 200,000 |
|
|
|
|
14-Jan-13 |
| $ | ***0.31 |
|
| 825,000 |
|
|
|
|
21-Feb-13 |
| $ | ***0.28 |
|
| 150,000 |
|
|
|
|
25-Mar-13 |
| $ | ***0.22 |
|
| 200,000 |
|
|
|
|
8-Apr-13 |
| $ | ***0.20 |
|
| 100,000 |
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| ||
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| 3,403,500 |
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| 2,484,000 |
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| ||
Weighted average exercise price at end of year |
|
| 0.57 |
|
| 0.89 |
| |||
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* These options were granted at CDN$0.50 (US $0.43 on date of grant)
** These options were granted at CDN$0.47 (US $0.41 on date of grant)
*** These options were granted in CDN Dollars which were approximately at par to US Dollars.
- 36 -
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| Number of Shares |
| ||||
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|
| |||||
|
| 2007-2008 |
| 2006-2007 |
| ||
|
|
|
| ||||
Outstanding, beginning of year |
|
| 2,484,000 |
|
| 2,958,000 |
|
Granted |
|
| 1,900,000 |
|
| 400,000 |
|
Expired |
|
| (20,000 | ) |
| (800,000 | ) |
Exercised |
|
| — |
|
| (74,000 | ) |
Forfeited |
|
| (960,500 | ) |
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|
|
Cancelled |
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|
|
|
|
|
|
Outstanding, end of year |
|
| 3,403,500 |
|
| 2,484,000 |
|
Exercisable, end of year |
|
| 3,249,334 |
|
| 1,625,786 |
|
Subsequent toDuring the year ended April 30, 2008December 31, 2019 we did not generate any revenue. During the Company forfeited 200,000 options on June 11, 2008 due to the resignation of an officer.
- 37 -
OPTIONS/SAR EXERCISED DURING THE MOST RECENTLY COMPLETED FISCAL YEAR
The following table provides detailed information regarding options exercised by the named executive officers during the fiscal year ended April 30, 2008 and options held byDecember 31, 2020, we recognized revenues from sub-leasing operations of $13,125. For the named executive officers as at April 30, 2008.
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Name and Principal |
| Shares acquired on |
| Value Realized |
| # of shares underlying options at year end |
|
|
| ||||
Kenneth Hill |
| 0 |
| N/A |
| 650,000 |
Howard Barth |
| 0 |
| N/A |
| 340,000 |
Rakesh Malhotra |
| 0 |
| N/A |
| 325,000 |
Brian Robertson |
| 0 |
| N/A |
| NIL |
Lisa Rose |
| 0 |
| N/A |
| 251,000 |
|
|
|
|
|
|
|
Paul Gorman (1) |
|
|
| N/A |
| Nil |
(1) Alltwelve months ended December 31, 2020, we recognized a direct cost of the stock options held by Mr. Gorman were cancelled on March 13, 2008 revenue of $13,125.
Stock options and warrants granted to
During the named executive officers during the fiscal year ended April 30, 2008 are provided in the table below:
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Name |
|
| Securities |
| % of Total |
| Exercise or |
| Market Value of Securities Underlying Options/SARs and Warrants on the Date of Grant ($/Security) |
| Expiration |
| ||||
Rakesh Malhotra, CFO |
|
| 75,000 |
|
| 4 | % |
| $0.31 |
|
| $0.30 |
|
| January |
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Ronald K. Mann, CEO (2) |
|
| 500,000 |
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| $0.24 |
|
| $0.35 |
|
| December |
|
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|
- 38 -
During the fiscal year ended April 30, 2008 there has been no re-pricing of stock options held by any Named Executive Officer.
There is aggressive competition within the industryDecember 31, 2020, expenses from operations were $297,519 compared to discover and acquire properties considered to have commercial potential. We compete with other companies for exploration resources including equipment and drilling teams available to work in the Province of Yukon. In addition, we compete with others in efforts to obtain financing to explore and develop mineral properties.
MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Discussion of Operations & Financial Condition for the Twelve months ended April 30, 2008
Yukon Gold has no source of revenue and we continue to operate at a loss. We expect our operating losses to continue for so long as we remain in an exploration stage and perhaps thereafter. As at April 30, 2008, we had accumulated losses of $11,889,157. These losses raise substantial doubt about our ability to continue as a going concern. Our ability to emerge from the exploration stage and conduct mining operations is dependent, in large part, upon our raising additional equity financing.
As described in greater detail below, the Company’s major endeavor over the year has been its effort to raise additional capital to meet its ongoing obligations under both the Hinton Syndicate Agreement and the Marg Acquisition Agreement and to pursue its exploration activities.
Having obtained material financing, we implemented exploration programs at both the Mount Hinton and Marg Properties.
SELECTED ANNUAL INFORMATION
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| April 30, 2008 |
| April 30, 2007 |
| ||
|
|
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| ||||
Revenues |
|
| Nil |
|
| Nil |
|
Net Loss |
| $ | 4,953,775 |
| $ | 3,703,590 |
|
Loss per share-basic and diluted |
| $ | (0.19 | ) | $ | (0.20 | ) |
Total Assets |
| $ | 2,526,600 |
| $ | 4,225,107 |
|
Total Liabilities |
| $ | 231,531 |
| $ | 272,083 |
|
Cash dividends declared per share |
|
| Nil |
|
| Nil |
|
The total assets$4,515 for the year ended April 30, 2008 includes cash and cash equivalents for $1,255,620, restricted cash for $817,092, Short-term investmentDecember 31, 2019. The increase in available-for-sale securities for $31,500, prepaid and other receivables for $282,347 and capital assets for $140,041. The total assets for the year ended April 30, 2007 includes cash and cash equivalents for $936,436, restricted cash and restricted deposit for $2,284,491 exploration tax credit receivable for $483,258, prepaid and other receivables for $464,371 and capital assets for $56,551.
Revenues
No revenueexpenses was generated by the Company’s operations during the years ended April 30, 2008 and April 30, 2007.
- 39 -
Net Loss
The Company’s expenses are reflected in the Consolidated Statements of Operations under the category of Operating Expenses. To meet the criteria of United States generally accepted accounting principles (“GAAP”), all exploration andprimarily due to higher general and administrative costs relatedexpenses resulting from the efforts to projects are chargedprepare us to operations inbecome a fully reporting company with the year incurred.SEC.
The significant components of expense that have contributed to the total operating expense are discussed as follows:
(a)General and Administrative ExpenseThree Months Ended March 31, 2021
Included in operating
During the three months ended March 31, 2021 and 2020 we did not generate any revenue.
During the three months ended March 31, 2021, expenses from operations were $192,804 compared to $0.00 for the yearthree months ended April 30, 2008 isMarch 31, 2020. The increase in expenses was primarily due to higher general and administrative expense of $1,702,640, as compared with $2,483,278 forexpenses resulting from the year ended April 30, 2007. General and administrative expense represents approximately 34% of the total operating expense for the year ended April 30, 2008 and approximately 56% of the total operating expense (net of the exploration tax credit) for the year ended April 30, 2007. General and administrative expense decreased by $780,638 in the current year, comparedefforts to the prior year. The decrease in this expense is mainly dueprepare us to decrease in consulting fees to consultants for providing investor relations and related market advice services and no expense relating to registration rights penalty expense (prior year $188,125).
Included in the operating expenses for the year ended April 30, 2008 (included as general and administration expense) is stock option compensation expense of $584,328 and compensation expense on issue of warrants for $123,079, as compared with stock option compensation expense of $451,273 and compensation expense on issue of warrants for $nil for the prior year ended April 30, 2007. These amounts have been calculated in accordance with generally accepted accounting principles in the United States, whereby the fair value of the stock options was determined at the time of grant of stock options to the Company’s directors, officers and consultants, and expensed over the vesting term, in terms of the Black-Scholes option pricing model.
(b)Project Expense
Included in operating expenses for the year ended April 30, 2008 is project expenses of $3,341,682 as compared with $1,899,340 for the year ended April 30, 2007. Project expense isbecome a significant expense and it represents approximately 66% of the total operating expense for the year ended April 30, 2008 and approximately 43% of the total operating expense (net of exploration tax credit) for the year ended April 30, 2007. Project expense increased by $1,442,342 in the current year, as compared to the prior year. The increase in this expense is mainly due to the additional expenses incurred by the Company on exploration of both the Mount Hinton Property claims and its Marg Property in the Yukon Territory of Canada. In March of 2005, the Company acquired the rights to purchase 100% of the Marg Property. During the current year ended April 30, 2008, the Company besides incurring exploration expenses on the Marg property, also made an additional payment of $98,697 (CDN$100,000) which formed part of project expenses. During the prior year ended April 30, 2007, the Company besides incurring exploration expenses on the Marg property, also made an additional payment of $86,805 (CDN $100,000) and issued 133,333 common shares valued at $100,000 which formed part of project expenses.
(c)Exploration Tax Credit
Included as a credit to operating expenses for the year ended April 30, 2008 is an exploration tax credit of $Nil, as compared to $321,013 for the year ended April 30, 2007. The Company had a claim to the Yukon exploration tax credit, since it maintains a permanent establishment in the province of Yukon, Canada and had incurred eligible mineral exploration expenses as defined by the federal income tax regulations of Canada. The province of Yukon, Canada has discontinued the grant of exploration tax credits beginning with incurred exploration expenses as at April 1, 2007 and onwards. On March 11, 2008 the Company received $299,207 (CDN$300,344) which represents the 2007 Yukon Tax Credit plus accumulated interest of $343 (CDN$344).
- 40 -
Agreement with Hinton Syndicate
For information about the Agreementfully reporting company with the Hinton Syndicate, see “DESCRIPTION OF BUSINESS – Agreement with Hinton Syndicate”, herein.SEC.
Exploration
For more information regarding exploration activities on our mineral properties during the fiscal year ended April 30, 2008, see the section entitled “DESCRIPTION OF BUSINESS-Description of Property” herein.
Liquidity and Capital Resources
The following table summarizes the Company’s
We had no cash flows and cash in hand:
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|
|
| April 30, 2008 |
| April 30, 2007 |
| ||
|
|
|
| ||||
Cash and cash equivalent |
| $ | 1,255,620 |
| $ | 936,436 |
|
Working capital |
| $ | 1,345,145 |
| $ | 1,639,008 |
|
Cash used in operating activities |
| $ | (2,038,973 | ) | $ | (4,903,195 | ) |
Cash used in investing activities |
| $ | (134,093 | ) | $ | (6,141 | ) |
Cash provided by financing activities |
| $ | 2,269,440 |
| $ | 3,492,092 |
|
As at April 30, 2008 the Company had working capital of $1,345,145 as compared to a working capital of $1,639,008 in the previous year. During the current year the Company raised (net) $2,271,080 by issue of share units for cash. During the prior year the Company raised (net) $3,009,762 by issuing common share units for cash. It also raised $429,537 through the exercise of warrants and $55,500 through the exercise of stock options. The Company invested a small amount of $102,593 (prior year $6,141) in capital assets in the form of computer equipment, furniture and fixtures, mining equipment and computer software.
Off-Balance Sheet Arrangement
The Company has no Off-Balance sheet arrangements as of April 30, 2008. As relating to the year ended April 30, 2007, the Company had a term deposit of $17,889 (CDN$20,000) with a Canadian financial institution which earned interest at 2.5% per annum with maturity on April 26, 2007. This deposit was assigned to the financial institution to enable the financial institution to issue an Irrevocable Letter of Credit to The First Nation of NaCho Nyak Dun (“NND”) which exercises certain powers over land use and environment protection within Yukon, Canada. The Company required access to move heavy equipment over the land controlled by NND and therefore posted this security bond so that if the Company failed to comply with reclamation requirements, then the security bond would be available to NND to complete the work or may form part of the compensation package. The term deposit was returned to the Company in May 2007 since the letter of credit expired.
- 41 -
Contractual Obligations and Commercial Commitments
In addition to the contractual obligations and commitments of the Company to acquire its mineral properties as described in “DESCRIPTION OF BUSINESS- Description of the Property,” the following are additional contractual obligations and commitments as at April 30, 2008.
Obligation under Capital Lease
The following is a summary of future minimum lease payments under the capital lease, together with the balance of the obligation under the lease as of April 30, 2008.
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|
Years ending April 30, |
|
|
|
|
|
|
|
2009 |
| $ | 3,551 |
|
| (CDN$ 3,577 | ) |
2010 |
| $ | 3,551 |
|
| (CDN$ 3,577 | ) |
2011 |
| $ | 3,551 |
|
| (CDN$ 3,577 | ) |
2012 |
| $ | 889 |
|
| (CDN$ 894 | ) |
|
|
|
| ||||
Total minimum lease payments |
| $ | 11,542 |
|
| (CDN$ 11,625 | ) |
Less: Deferred Interest |
| $ | 1,233 |
|
| (CDN$ 1,242 | ) |
|
|
|
| ||||
|
| $ | 10,309 |
|
| (CDN$ 10,383 | ) |
Current Portion |
| $ | 3,100 |
|
| (CDN$ 3,122 | ) |
|
|
|
| ||||
Long-Term Portion |
| $ | 7,209 |
|
| (CDN$ 7,261 | ) |
Flow-Through Share Subscription
Year Ended April 30, 2008
The Company entered into flow-through share subscription agreements during the year ended April 30, 2008 whereby it is committed to incur on or before December 31, 2008, a total of $833,995 (CDN$840,000) of qualifying Canadian Exploration expenses as described in2019.
We had no cash flows during the Income Tax Act of Canada. As of April 30, 2008 an expenditure of $53,291 (CDN$53,675) has been incurred and $780,704 (CDN$786,325) has not yet been spent. Commencingthree months ended March 1, 200831, 2020.
During the Company is liable to pay a tax of approximately 5% per annum, calculated monthly on the unspent portion of the commitment.
Flow-Through Share Subscriptions Subsequent to the Yearyear ended April 30, 2008
On July 23, 2008 the Company closed the first tranche of a non-brokered private placement of up to $992,851 (CDN$1,000,000). The Company completedDecember 31, 2020 we received $351,091 from the sale of 4,134,000our common sharesstock and warrants.
During the three months ended March 31, 2021 we received $205,036 from the sale of our common stock and warrants.
On August 17, 2020, VitaNova agreed to provide us with a $1,000,000 line of credit. Amounts drawn on the line of credit bear interest at 6% per year. We have not drawn on this line of credit as of the date of this prospectus.
Capital Requirements
Our estimated capital requirements for the twelve month period following the date of this prospectus are:
● | General and administrative expenses | $ | 2,100,000 | |||
● | Retrofit/ construction of greenhouses and warehouses | $ | 14,750,000 | (1) | ||
● | Acquisition of solar systems to power greenhouses | $ | 3,375,000 |
(1) Represents the costs to retrofit an existing greenhouse and warehouse and construct two new warehouse/ greenhouse facilities on the land we plan to acquire in southern Colorado. See the “Business” section of this prospectus for information concerning our plans to pay these costs.
Significant Accounting Policies
See Note 2 to the March 31, 2021 Financial Statements included as part of this prospectus for a flow-through basis at a pricediscussion of $0.15 (CDN$0.15) per share for gross proceeds of $615,578 (CDN$620,010). our significant accounting policies.
9 |
The Company paid a 5% finders fee on this private placement. The proceedsintends to have two streams of revenue. One is from the private placementdevelopment, construction, and sale leaseback of flow-throughsolar powered greenhouse facilities. The other from the growing fruits and vegetables for sale to local markets.
On May 26, 2021 the Company acquired 29% of the issued and outstanding shares of GrowCo, Inc. GrowCo’s only asset is approximately 39 acres of land in southeastern Colorado.
After the date of this prospectus the Company plans to acquire:
● | GrowCo Partners 1, LLC, which owns approximately 39 acres of land | |
● | approximately 78 acres of land from GrowCo Partners 2, LLC, and | |
● | approximately 39 acres of land from GrowCo, Inc. |
for 95,000,000 shares of the Company’s common stock. The 156 acres are located in southeastern Colorado.
There is one fully completed 90,000 sq. ft. greenhouse, and one adjoining fully completed 15,000 sq. ft. warehouse on the land to be purchased by the Company. The greenhouse/ warehouse facilities, once purchased, retrofitted and/or constructed, will be used by Yukon Goldthe Company to grow farm fresh fruits and vegetables for program expenditures ondelivery to local food markets. The completed greenhouse and warehouse have not been in operation since 2020.
On the Margland in southern Colorado the Company plans to:
1. | retrofit the existing greenhouse and warehouse so that the equipment in the greenhouse and warehouse will run on solar power as opposed to propane. (Estimated cost: $750,000. Estimated time to complete: six months). Acquire solar system to power the greenhouse/ warehouse (Estimated cost: $1,125,000) | |
2. | construct one new 90,000 sq. ft. greenhouse and one new 15,000 sq. ft. warehouse (Estimated cost: $4,500,000. Estimated time to complete: twelve months). Acquire solar system to power the greenhouse/ warehouse (Estimated cost: $1,125,000) | |
3. | construct three new 180,000 sq. ft. greenhouses and three new 30,000 sq. ft. warehouses (Estimated cost: $27,000,000. Estimated time to complete: 36 months). Acquire solar systems to power the greenhouses and warehouses (Estimated cost: $3,375,000). |
The greenhouse/ warehouse facilities will be solar powered. The Company plans to acquire the solar systems which will power the greenhouse/ warehouse facilities from VetaNova Solar Partners, LLC. (“VSP”) at a cost of approximately $1,125,000 per system. As of July 15, 2021 VSP had not constructed any solar systems and had cash of approximately $333,000. VSP will need to raise a significant amount of capital to build the solar systems for the Company.
The Company plans to finance the cost of retrofitting the facility described in (1) above, and acquiring solar system needed to power the facility, with a loan from a lender associated with Colorado’s Commercial Property andAssessed Clean Energy Program. Once the Mount Hinton Property. The private placement was exempt from registration underfacility is operational, the Securities Act of 1933, pursuantCompany plans to sell the facility to an exemption afforded by Regulation S.
Consulting & Services Agreements
On August 15, 2007investor and then lease back the facility from the investor. With the proceeds from the sale of this facility, the Company entered into an investor relations marketing agreement with a consultantexpects to have sufficient funds to construct the facility described in (2) above, and acquire the solar systems required to power the facility. Sequentially using the sale/ lease back financing technique for a one year term, witheach greenhouse/ warehouse facility (with the option to renew for an additional 12 months. In return for services rendered,exception of the last facility) the Company will payexpects to have sufficient capital to construct the consultant $1,992 (CDN$2,000) per month. On August 31, 2007facilities described in (3) above and to acquire the solar systems for these facilities.
The Company may also finance all or a part of the cost of retrofitting/ constructing greenhouses and warehouses and acquiring solar systems through future offering of the Company’s securities proceeds from the exercise of the Company’s warrants or borrowings from private lenders.
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As of the date of this prospectus the Company paid $3,787 (CDN$4,000) being the first and last payments of the contract. On September 15, 2007 the Company paid $1,941 (CDN$2,000) and on October 15, 2007 the Company paid $2,048 (CDN$2,000), being the second and third payments respectively. On November 15, 2007 the Company paid $2,030 (CDN$2,000) being the fourth payment of the contract. On December 14, 2007 the Company paid $1,967 (CDN$2,000) and on January 15, 2008 the Company paid $1,967 (CDN$2,000), being the fifth and sixth payments of the contract respectively. In addition, the consultant has been granted an optiondid not have any agreements with any person to purchase 125,000 shares of the Company at $0.45 (CDN$0.45) per share, with the option vesting in equal quarterly amounts of 31,250 shares on November 15, 2007, February 15, 2008, May 15, 2008 and August 15, 2008, and the first exercise date being August 15, 2008 and an expiry date of August 15, 2010. Subsequently on February 12, 2008 the Company terminated the contract and the Company received a refund on March 11, 2008 of $1,295(CDN$1,300) previously paid on August 31, 2007 to cover the last payment of the one year term. The 31,250 options granted under the contract to vest on each of May 15, 2008 and August 15, 2008 respectively were also cancelled.
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On December 5, 2007 the Company entered into an agreement with a consultant to create investor awareness for a period of six months, commencing on December 5, 2007 for a fee of $20,000 and 300,000 restricted common shares to be issued in equal tranches of 50,000 shares at the end of each month during the term of the agreement. On December 6, 2007 the Company received conditional approval from the TSX to issue the 300,000 restricted shares as per the terms of the agreement. The consulting fee of $20,000 was paid on December 11, 2007. The Company had accrued the expense of $22,000 for 100,000 shares to be issued to January 31, 08. Due to non-performance of the agreement by the consultant, the Company has obtained legal opinion that it is not obligated to issue any of the restricted 300,000 common shares. The consulting expense accrualCompany’s securities lend any funds to the Company or purchase and lease back any of the greenhouse/ warehouse facilities which the Company plans to retrofit or construct.
Solar Energy Overview
Solar power is energy from the sun that is converted into thermal or electrical energy. Solar energy is the cleanest and most abundant renewable energy source available. Solar technologies can harness this energy for $22,000 seta variety of uses, including generating electricity, providing light or a comfortable interior environment, and heating water for domestic, commercial, or industrial use.
There are three main ways to harness solar energy: photovoltaic, solar heating and cooling, and concentrating solar power. Photovoltaics generate electricity directly from sunlight via an electronic process and can be used to power anything from small electronics such as calculators and road signs up duringto homes and large commercial businesses. Solar heating and cooling (SHC) and concentrating solar power (CSP) applications both use the quarter ended January 31, 2008 was reversed and credited backheat generated by the sun to incomeprovide space or water heating in the case of SHC systems, or to run traditional electricity-generating turbines in the case of CSP power plants.
Solar energy is a very flexible energy technology: it can be built as distributed generation (located at or near the point of use) or as a central-station, utility-scale solar power plant (similar to traditional power plants). Both of these methods can also store the energy they produce for distribution after the sun sets, using new solar and storage technologies.
In the last quarterdecade alone, solar has experienced an average annual growth rate of 2008. 48%. Thanks to strong federal policies like the solar Investment Tax Credit, rapidly declining costs, and increasing demand across the private and public sector for clean electricity, there are now nearly 78 gigawatts (GW) of solar capacity installed nationwide, enough to power 14.5 million homes.
The Companycost to install solar has also paiddropped by more than 70% over the requisite feelast decade, leading the industry to expand into new markets and deploy thousands of systems nationwide. Prices as of June 2021 are at their lowest levels in history across all market segments.
Solar has ranked first or second in new electric capacity additions in each of the last years. In 2019, 40% of all new electric capacity added to the TSX for cancellationgrid came from solar, the largest such share in history. Solar’s increasing competitiveness against other technologies has allowed it to quickly increase its share of total U.S. electrical generation - from just 0.1% in 2010 to more than 2.5% today.
Homeowners and businesses are increasingly demanding solar systems that are paired with battery storage. While this pairing is still relatively new, the growth over the next five years is expected to be significant. By 2025, more than 25% of all behind-the-meter solar systems will be paired with storage, compared to under 5% in 2019.
Recent Transactions
On May 26, 2021 the Company acquired 29% of the issued and outstanding shares of GrowCo, Inc. as well as membership interests in GrowCo Partners 1, LLC from an unrelated third party. In consideration for the assignment of these shares.
Effective as of December 15, 2007securities the Company entered into a consulting agreement with Ronald Mann (the “Mann Agreement”), pursuant to which Mr. Mann was retained asissued the Company’s President and Chief Executive Officer. The board of directors of the Company appointed Mr. Mann to fill a vacancy on the board of directors, also effective as of December 15, 2007. The Mann Agreement has a one-year term commencing on December 15, 2007, and is automatically renewable thereafter, unless terminated pursuant to the terms of the Mann Agreement. Mr. Mann and the Company shall indicate their respective intentions to renew the term after the passage of eight (8) months from the date of the Mann Agreement. Pursuant to the Mann Agreement, Mr. Mann will receive an annual consulting fee of $148,928 (CDN$150,000). In addition, Mr. Mann received 500,000 warrants to purchaseunrelated third party 4,384,913 shares of the Company’s common stock (the “Mann Warrants”). The Mann Warrants shall have a term of 5 years andas well as warrants to purchase an exercise price of the fair market valueadditional 4,384,913 shares of the Company’s common stock. The warrants are exercisable at any time on or before September 30, 2022 at a price of $0.20 per share.
On July 12, 2021, the Company issued 91,072,971 shares of its common stock, as well as warrants to purchase as additional 10,249,375 shares of its common stock, to VitaNova in payment of expenses (amounting to $9,108) paid by VitaNova on their date of issuance. 250,000behalf of the Mann Warrants were fully vestedCompany. The warrants are exercisable at any time on or before December 31, 2022 at a price of $0.20 per share. VitaNova then transferred those shares to certain members of VitaNova in exchange for the members interests in VitaNova. John McKowen, the Company’s only Officer and Director and a controlling person of VitaNova, did not receive any of those shares.
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Officers and Directors
Name | Age | Position | ||
John R. McKowen | 71 | Chief Executive, Financial, and Accounting Officer and a Director |
John R. McKowen has been an officer and director of the Company since June 2018. Prior to joining the Company, Mr. McKowen served as the Chief Executive Officer and President of GrowCo Inc., a builder of greenhouses, from May 2014 to May 2016 and again since October 2017. Mr. McKowen was the Chief Executive Officer and Chairman of the Board of Directors of Two Rivers Waters and Farming Company from November 2009 to May 2016.
We believe Mr. McKowen is qualified to act as a director based upon issuance,his knowledge of business practices and, in particular, his experience in building greenhouses.
Mr. McKowen is not independent as that term is defined in Section 803 of the NYSE American Company Guide.
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until their successors are elected or appointed. Our officers are appointed by our board of directors and serve at the discretion of the board.
We do not have a financial expert as that term is defined by the Securities and Exchange Commission.
Our Board of Directors does not have standing audit, nominating or compensation committees, committees performing similar functions, or charters for such committees. Instead, the functions that might be delegated to such committees are carried out by our directors, to the extent required. Our directors believe that the cost of associated with such committees, has not been justified under our current circumstances. During the remaining 250,000 vesting 6 months fromyear ended December 31, 2020 we did not compensate any person for serving as an officer or a director.
Our Board of Directors has the ultimate responsibility to evaluate and respond to risks facing us. Our Board of Directors fulfills its obligations in this regard by meeting on a regular basis and communicating, when necessary, with our officers.
We have not adopted a Code of Ethics which is applicable to our principal executive, financial, and accounting officers and persons performing similar functions since we only have one executive office.
Holders of our common stock can send written communications to our entire Board of Directors, or to one or more Board members, by addressing the communication to “the Board of Directors” or to one or more directors, specifying the director or directors by name, and sending the communication to our corporate office. Communications addressed to the Board of Directors as whole will be delivered to each Board member. Communications addressed to a specific director (or directors) will be delivered to the director (or directors) specified.
A security holder communication not sent to the Board of Directors as a whole is not relayed to Board members which did not receive the communication.
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Executive Compensation
Our executive officers will be compensated through the following three components:
● | Base Salary |
● | Short-Term Incentives (cash bonuses) |
● | Long-Term Incentives (equity-based awards) |
● | Benefits |
These components provide a balanced mix of base compensation and compensation that is contingent upon our executive officer’s individual performance. A goal of the compensation program is to provide executive officers with a reasonable level of security through base salary and benefits. We want to ensure that the compensation programs are appropriately designed to encourage executive officer retention and motivation to create shareholder value. We believe that our shareholders are best served when we can attract and retain talented executives by providing compensation packages that are competitive but fair.
Base Salaries
Base salaries generally have been targeted to be competitive when compared to the salary levels of persons holding similar positions in other publicly traded mining companies of comparable size. The executive officer’s respective responsibilities, experience, expertise, and individual performance are considered.
Short-Term Incentives
Cash bonuses may be awarded at the sole discretion of the Board of Directors based upon a variety of factors that encompass both individual and company performance.
Long-Term Incentives
Equity incentive awards help to align the interests of our employees with those of our shareholders. Equity based awards are made under our Equity Incentive Plan. Options are granted with exercise prices equal to the closing price of our common stock on the date of issuance,grant and may be subject to a vesting schedule as determined by the Board of Directors who administer the plan.
We believe that grants of equity-based compensation:
● | enhance the link between the creation of shareholder value and long-term executive incentive compensation; |
● | provide focus, motivation, and retention incentive; and |
● | provide competitive levels of total compensation |
In addition to cash and equity compensation programs, executive officers participate in the health and welfare benefit programs available to other employees.
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Compensation Table
The following table sets forth in summary form the compensation received by our Chief Executive Officer for the fiscal year ended December 31, 2020:
Name and Principal Position | Fiscal Year | Salary (1) | Bonus (2) | Stock Awards (3) | Option Awards (4) | All Other Compensation (5) | Total | |||||||||||||||||||||
John R. McKowen | 2020 | – | – | $ | 8,811 | – | – | $ | 8,811 | |||||||||||||||||||
Chief Executive, Financial | 2019 | – | – | – | – | – | – | |||||||||||||||||||||
and Accounting Officer | ||||||||||||||||||||||||||||
Louise Lowe | 2020 | – | – | $ | 302 | – | – | $ | 302 | |||||||||||||||||||
Secretary | 2019 | – | – | – | – | – | – |
(1) | The dollar value of base salary (cash and non-cash) earned. |
(2) | The dollar value of bonus (cash and non-cash) earned. |
(3) | The value of all stock awarded during the periods covered by the table is calculated according to ASC 718-10-30-3 which represented the grant date fair value. |
(4) | The fair value of all stock options granted during the periods covered by the table are calculated on the grant date in accordance with ASC 718-10-30-3 which represented the grant date fair value. |
(5) | All other compensation that could not be properly reported in any other column. |
Ms. Lowe resigned as an officer and director on June 15, 2008 (subsequentFebruary 5, 2021.
Since our inception, we have not compensated any person for acting as a director.
The following shows the amount we expect to pay to Mr. McKowen and the amount of time Mr. McKowen expects to devote to our business during the year ended April 30, 2008.)ending December 31, 2021.
As of
Projected Monthly | Percent of Time to Be | |||||
Compensation | Devoted to our Business | |||||
$ | 7,500 | 100 | % |
Transactions with Related Parties
On December 18, 2007 the Company entered into a consulting agreement with Cletus Ryan (the “Ryan Agreement”) pursuant to which Mr. Ryan1, 2020 John R. McKowen was retained as the Company’s Vice President, Corporate Development. The Ryan Agreement has a six-month term commencing on December 18, 2007 and is automatically renewable thereafter, unless terminated pursuant to the terms of the Ryan Agreement. Pursuant to the Ryan Agreement, Mr. Ryan will receive an annual consulting fee of $119,142 (CDN$120,000). In addition, Mr. Ryan received 200,000 options to purchaseissued 88,107,690 shares of the Company’s common stock (the “Ryan Options”). The Ryan Options were fully vested upon the date of issuance. On March 7, 2008 the Company renewed the Ryan Agreement for an additional six months.
On February 11, 2008 by letter engagement agreement the Company contracted the services of a Corporate Secretarial company to fill the role of Mrs. Lisa Rose during her maternity leave for a monthly fee of $1,340 (CDN$1,350) plus eligible expenses.
On February 18, 2008 the Company and YGC signed a surface drilling contract with a diamond drilling company for the Marg Project to commence on or about June 18, 2008, with an estimated all-in cost of $1,985,703 (CDN$2,000,000). On February 18, 2008 the Company paid $148,928 (CDN$150,000) as a deposit per the terms of the contract.
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On March 10, 2008 the Company entered into a contract with a global mining consultancy business for a scoping study and to prepare a report pursuant to the terms of Canadian National Instrument 43-101, regarding the Marg Deposit at an estimated cost of $79,428 (CDN$80,000). The Company paid $18,579 (CDN $18,713) at April 30, 2008. Subsequent to the year end, the Company has paid an additional $7,270 (CDN$7,322).
On March 18, 2008 the Company entered into a consulting agreement with Gary Cohoon (the “Cohoon Agreement”) pursuant to which Mr. CohoonLouise Lowe was retained as Vice-President, Exploration, of the Company. The Cohoon Agreement has a one-year term commencing on March 18, 2008 and is automatically renewable thereafter, unless terminated pursuant to its terms. Pursuant to the Cohoon Agreement, Mr. Cohoon will receive an annual consulting fee of $139,000 (CDN$140,000). Additionally, Mr. Cohoon received 200,000 options to purchaseissued 3,019,455 shares of the Company’s common stock (the “Cohoon Options”). for services rendered and valued at $0.0001 per share. A total of 29,369,230 shares owned by Mr. McKowen and 1,006,485 shares owned by Mrs. Lowe are subject to repurchase by the Company for a price of $0.0001 per share if the Warrant Performance Metric described below is not satisfied. A total of 29,369,230 shares owned by Mr. McKowen and 1,006,485 shares owned by Mrs. Lowe are subject to repurchase at such price if the Secondary Performance Metric is not satisfied.
The Cohoon Options were fully vested upon issuance.“Warrant Performance Metric” will be satisfied if Warrants issued in the Company’s 2020 Private Placement are exercised to acquire at least 42,140,266 shares of the Company’s common stock. The “Secondary Performance Metric” will be satisfied if, prior to December 31, 2022, the Company completes a “sale lease back” of a solar powered property and receives gross proceed of a least $6,000,000 from the sale.
On April 10, 2008 by letter agreementJuly 15, 2020, the Company procured the services of Galina Morozova through a contract position as a Geologist with YGC, the Company’s wholly-owned subsidiary commencing April 15, 2008 until August 31, 2008. Ms. Morozova will receive $6,454 (CDN$6,500) per month until the project begins at the Marg Property on approximately June 15, 2008, whereupon Ms. Morozova will receive $496 (CDN$500) per day plus expenses for the duration of the term of the letter agreement.
On April 29, 2008 the Company entered into a letter agreement with R. Andrew Hureau for a contract position as Senior Geologist with YGC, the Company’s wholly-owned subsidiary. Mr. Hureau’s position commenced on May 1, 2008 at a rate of $745 (CDN$750) per day plus expenses. The letter agreement states that the term is on commencement and for the duration of drilling on the Marg Project, approximately mid June, 2008 to the end of August, 2008, on a regular schedule.
Subsequent Events
Subsequent to the year ended April 30, 2008 the Company sold the balance of 450,000 shares of Industrial Minerals, Inc. at an average selling price of $.0655 for a total consideration of $29,460 in the open market.
On May 5, 2008 the Company entered into an investor relations agreement (the “Equicom Agreement”) with Equicom Group Inc. (“Equicom”) pursuant to which Equicom was retained to provide the Company with general marketing and business consulting services for an initial term of one year, then renewable thereafter. Equicom will receive an annual work fee of $59,571 (CDN$60,000), payable in monthly installments of $4,964 (CDN$5,000). The initial prorated retainer in the amount of $4,319 (CDN$4,350) and the June 1-30, 2008 installment of $4,964 (CDN$5,000) were made on May 30, 2008. On July 1, 2008 the installment covering July 1-31, 2008 of $4,964 (CDN$5,000) was paid. On July 23, 2008 the Company gave notice to Equicom of the termination of the Equicom Agreement effective as of September 30, 2008. On August 1, 2008 the installment covering August 1-31, 2008 of $4,964 (CDN$5,000) was paid. By letter dated July 23, 2008, the Company terminated the Equicom Agreement with such termination to take effect as of September 30, 2008.
On May 16, 2008 the CompanyVitaNova Partners, LLC entered into a consulting agreement (the “Clarke Agreement”) with Clarke Capital Group Inc. (“Clarke”) pursuant to which Clarke was retainedwhereby VitaNova agreed to provide management services until a private placement was completed and the shareholders of the Company with investor relations and business communications services for an initial term of 6 months, renewable thereafter for an additional 6 month term. Upon execution of the Clarke Agreement the Company paid Clarke $14,893 (CDN$15,000). Clarke will also receivecould properly elect a monthly work fee of $3,475 (CDN$3,500) during the term of the agreement. Upon renewal, Clarke will receive an additional payment of $9,928 (CDN$10,000). Pursuant to the Clarke Agreement, the Company issued Clarke 50,000 shares of common stock on July 14, 2008, with an additional 50,000 shares issuable upon renewal.
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On May 20, 2008 YGC, the Company’s wholly-owned subsidiary entered into a service provision agreement with a company to provide cooking and first aid services on the Marg Property from June 15, 2008 to September 30, 2008. On June 4, 2008 the Company paid a $9,929 (CDN$10,000) advance to the service provider as per the terms of the agreement.
On June 11, 2008 the Company cancelled 200,000 stock options held by a former officer.
On June 16, 2008 an additional 18 claims were staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement.
On June 17, 2008 the balance of 250,000 warrants granted to Ronald Mann vested.
On July 3, 2008 the board of directors appointed Kathy Chapman Interim Corporate Secretaryand Company officers could be appointed. VitaNova was paid $456,000 annually for its management services. On December 15, 2020 the consulting agreement was amended to temporarily fillreduce payments to $19,000 a month effective January 1, 2021.
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The following table provides information with respect to the Corporate Secretary position while Mrs. Lisa Roseexpected beneficial ownership of our common stock, of (i) each person or entity that is on maternity leave.a beneficial owner of more than 5% of our outstanding common stock, (ii) each executive officer and director and (iii) all our directors and executive officers as a group.
On July 7, 2008, the
Name and Address of Beneficial Owner | Shares Owned | Percent of Outstanding Shares | ||||||
John R. McKowen | 88,107,690 | 24.9 | % | |||||
335 A Josephine St. | ||||||||
Denver, Colorado 80206 | ||||||||
VitaNova Partners, LLC | 56,052,837 | (1) | 15.8 | % | ||||
335 A Josephine Street | ||||||||
Denver, CO 80206 | ||||||||
Prasil Family Matters, LLC | ||||||||
7275 N. Scottsdale Road | ||||||||
Paradise Valley, AZ 85253 | 39,137,327 | 11.1 | % | |||||
Jon D. & Linda W. Gruber Trust | ||||||||
300 Tamal Plaza, Ste 280 | ||||||||
Corte Madera, CA 94925 | 36,650,603 | 10.4 | % | |||||
I. Wistar Morris | ||||||||
19 Pond Lane | ||||||||
Bryn Mawr, PA 19010 | 19,998,386 | 5.7 | % | |||||
RM Materials, LLC | ||||||||
516 W. Colorado Ave. | ||||||||
Colorado Springs, CO 80905 | 61,510,800 | 17.4 | % | |||||
All officers and directors | ||||||||
as a group (one person) | 144,160,527 | 40.8 | % |
(1) VitaNova is controlled by Mr. McKowen.
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VetaNova Solar Partners, LLC (“VSP”) has both Common and Preferred Membership interests outstanding. The Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40%owns approximately 60% of the contracted paymentoutstanding Common Membership interests and were valued at $0.126 (CDN$0.126) each. The balancenone of the property paymentoutstanding Preferred Membership interests of VSP.
When VSP sold Preferred Membership interests to its investors, the persons who acquired Preferred Membership interests in VSP were given the amountright to exchange their membership interests in VSP for shares of $89,357(CDN$90,000) was paid in cash.
On July 23, 2008 the Company closed the first tranche of a non-brokered private placement of up to $992,851 (CDN$1,000,000). The Company has completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $615,578 (CDN$620,010). The Company paid a 5% Finders Fee on this private placement. The proceeds from the private placement of flow-through shares will be used by Yukon Gold for program expenditures on the Marg Property and the Mount Hinton Property. The private placement was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
As of July 28, 2008, the Company entered into a Consulting Agreement with First Canadian Capital Corp. (“First Canadian”) pursuant to which First Canadian will provide general marketing and business consulting services for an initial term of one year, renewable thereafter. The Company will pay First Canadian $5,957 (CDN$6,000) per month. The Company paid the first three months of such fees in advance. In addition, the Company will issue to First Canadian 250,000 options to buy the Company’s shares at a purchase pricecommon stock and warrants. Accordingly, by means of $0.15 (CDN$0.15) per share. The Stock options shall vest over the initial term of the agreement.
On August 1, 2008 the Board of Directors appointed Kathy Chapman to the position of Chief Administrative Officer.
Critical Accounting Policies
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect reported amounts of assets and liabilities at the date of the financial statements, the reported amount of revenues and expenses during the reporting period and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates and judgments, particularly those related to the determination of the estimated Canadian exploration tax credit receivable and accrued liabilities. To the extent actual results differ from those estimates, our future results of operations may be affected. Besides this critical accounting policy on use of estimates, we believe the following critical accounting policy affects the preparation of our consolidated financial statements.
Acquisition, Exploration and Evaluation Expenditures
The Company is an exploration stage mining company and has not yet realized any revenue from its operations. It is primarily engaged in the acquisition and exploration of mining properties. Mineral property exploration costs are expensed as incurred. Mineral property payments are capitalized only ifprospectus, the Company is able to allocate any economic value beyond proven and probable reserves. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property will be capitalized. For the purpose of preparing financial information, the Company is unable to allocate any economic value beyond proven and probable reserves and hence all property payments are considered to be impaired and accordingly written off to project expense. All costs associated with a property that has the potential to add to the Company’s proven and probable reserves are expensed until a final feasibility study demonstrating the existence of proven and probable reserves is completed. No costs have been capitalized in the periods covered by these financial statements. Once capitalized, such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.
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Mineral property acquisition costs will also be capitalized in accordance with the FASB Emerging Issues Task Force (“EITF”) Issue 04-2 when management has determined that probable future benefits consisting of a contribution to future cash inflows have been identified and that adequate financial resources are available or are expected to be available as required to meet the terms of property acquisition and budgeted exploration and development expenditures. Mineral property payments are expensed as incurred if the criteria for capitalization is not met.
To date, mineral property payments have been expensed as incurred. As of the date of these financial statements, the Company has incurred only acquisition and exploration costs which have been expensed. To date the Company has not established any proven or probable reserves on its mineral properties
(a)Disclosure Controls and Procedures. The Company’s management, with the participation of the principal executive officer and principal financial officer, respectively, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the year ended April 30, 2008. Based on such evaluation, the principal executive officer and principal financial officer of the Company, respectively, have concluded that, as of the fiscal year ended April 30, 2008, the Company’s disclosure controls and procedures are effective. On April 16, 2008, the Company’s Audit Committee met to review its evaluation of the Company’s internal controls. The Audit Committee concluded that the Company’s disclosure controls and procedures are effective.
(b)Internal Control Over Financial Reporting. There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the year ended April 30, 2008 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Limitations on the Effectiveness of Controls. We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
As of August 14, 2008, there are 33,650,629 shares of common stock outstanding, held by 708 shareholders of record.
On July 23, 2008 the Company closed the first tranche of a non-brokered private placement of up to $992,851 (CDN$1,000,000). The Company completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $615,578 (CDN$620,010). The Company paid a 5% finders fee on this private placement. The proceeds from the private placement of flow-through shares will be used by Yukon Gold for program expenditures on the Marg Property and the Mount Hinton Property. The private placement was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
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On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.126 (CDN$0.126) each. The balance of the property payment in the amount of $89,357(CDN$90,000) was paid in cash. The issuance was exempt from registration under the Securities Act of 1933, as amended pursuant to an exemption afforded by Regulation S promulgated thereunder.
On June 18, 2008 the Company approved the issuance of 100,000 shares of common stock to a consultant as payment for investor relations and business communications services. Of that amount, 50,000 shares were issued July 14, 2008 with the balance of 50,000 shares to be issued upon renewal of the consulting agreement. The issuance was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On November 27, 2007, the board of directors unanimously resolved to extend the term of the Company’s 2,665,669 outstanding warrants that were issued in connection with the Company’s March 2006 private placement financing (the “March 2006 Warrants. Also extended were (a) the term of the 533,133 outstanding broker warrants that were issued in connection with such March 2006 private placement (the “March 2006 Broker Warrants” and (b) the term of the Company’s 950,000 outstanding warrants that were issued in connection with the Company’s October 2006 private placement financing (the “October 2006 Warrants”).
Each March 2006 Warrant entitled the holder thereof to purchase one common share of the Company at a price of US$0.90 until March 28, 2008. Each March 2006 Broker Warrant entitled the holder thereof to purchase one unit of securities of the Company (each a “Unit”) at a price of US$0.60 per Unit until March 28, 2008. Each Unit consists of one common share and one-half of a common share purchase warrant, where each whole warrant (an “Underlying Warrant”) is exercisable to acquire one common share at a price of US$0.90 until March 28, 2008. Each October 2006 Warrant entitled the holder thereof to purchase one common share at a price of US$2.00 until October 4, 2008. The March 2006 Warrants and the October 2006 Warrants have been amended, effective immediately prior to the expiry of such warrants on March 28, 2008 and October 4, 2008, respectively, to extend the term of such warrants until March 28, 2009 and October 4, 2009, respectively. The March 2006 Broker Warrants have been amended, effective immediately prior to the expiry of such warrants on March 28, 2008, to extend the term of such warrants and the Underlying Warrants until March 28, 2009. All other provisions of the March 2006 Warrants, the March 2006 Broker Warrants and the October 2006 Warrants were unaffected.
On August 16, 2007 the Company completed a private placement (the “Financing”) with Northern Securities Inc. (“Northern”), acting as agent. The Financing was comprised of the sale of 1,916,666 units (the “Units”) at $0.42 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $802,101 (CDN$862,499.70) and the sale of 543,615 flow-through units (the “Flow-Through Units” which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at $0.49 (CDN$0.52) per Flow-Through Unit (the “Flow-Through Unit Issue Price”) for gross proceeds of $262,884 (CDN$282,680). The proceeds raised were allocated between the offering of shares and the sale of tax benefits A liability of $35,381 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor. Each Unit consisted of one non-flow through common share (“Common Share”) and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consisted of one flow-through common share and one half of one Common Share purchase warrant (each whole warrant, an “FT Warrant”). Each FT Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. The Company paid Northern a commission equal to 8% of the aggregate gross proceeds which amounted to $85,199 (CDN$91,614) and issued 153,333 “Unit Compensation Warrants” and 43,489 “FT Unit Compensation Warrants”. Each Unit Compensation Warrant is exercisable into one Unit at the Unit Issue Price until August 16, 2009. Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one FT Warrant at the Flow-Through Unit Issue Price until August 16, 2009. Yukon Gold also granted Northern an option (the “Over-Allotment Option”) exercisable until October 15, 2007 to offer for sale up to an additional $468,691 (CDN$500,000) of Units and/or Flow-Through Units on the same terms and conditions. The Company paid a $70,304 (CDN$75,000) due diligence fee to Northern at closing. The Company reimbursed Northern expenses of $18,600 (CDN$20,000) and legal fees of $18,600 (CDN$20,000).
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On November 16, 2007 the Company completed the second part of a private placement (the “Second Financing”) with Northern acting as agent. The Second Financing was comprised of the sale of 2,438,888 units (the “Units”) at $0.46 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $1,127,028 (CDN$1,097,500) and the sale of 1,071,770 flow through units (the “Flow-Through Units”) at $0.53 (CDN$0.52) per Flow-Through Unit (the “Flow-Through Unit Issue Price”) for gross proceeds of $572,315 (CDN$557,320). The proceeds raised were allocated between the offering of shares and the sale of tax benefits. A liability of $77,043was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor. The closing represented the final tranche of a $2,816,673 (CDN$2.8 million) private placement with Northern announced on July 24, 2007. Each Unit consists of one non-flow through common share (“Common Share”) and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consists of one flow-through common share and one half of one Common Share purchase warrant (each whole warrant, an “FT Warrant”). Each FT Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. Yukon Gold paid Northern a commission equal to 8% of the aggregate gross proceeds and issued 195,111 “Unit Compensation Options” and 85,741 “FT Unit Compensation Options”. Each Unit Compensation Option is exercisable into one Common Share and one half of one Common Share purchase warrant at the Unit Issue Price until November 16, 2009. Each full Common share purchase warrant is exercisable at $0.60 (CDN$0.60). Each FT Unit Compensation Option is exercisable into one Common Share and one half of one Common Share purchase warrant at the Flow-Through Unit Issue Price. Each full Common Share purchase warrant is exercisable at $0.70 (CDN$0.70).
The proceeds of the Financing will be used for the exploration and development of Yukon Gold’s properties, and for working capital.
The foregoing private placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act of 1933, as amended.
On July 7, 2007 the Company issued 136,364 common shares in settlement of a property payment on the Mount Hinton property. The shares represent $57,252 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.42 (CDN$0.44) each. The balance 60% payment was paid in cash. The private placement was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
On April 25, 2007 the Company issued 2,823,049 common shares and an additional 282,309 shares as a penalty, relating to the private placement of 2,823,049 flow-through special warrants on December 28, 2006. The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The Company expensed an amount of $163,739 to registration rights penalty expense under the heading General and Administration and credited this to Additional Paid in Capital. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
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On April 25, 2007 the Company issued 334,218 common shares and an additional 33,423 shares as a penalty, relating to the private placement of 334,218 unit special warrants on December 28, 2006. The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The Company expensed an amount of $19,386 to registration rights penalty expense under the heading General and Administration and credited this to Additional Paid in Capital. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
On January 11, 2007, the Company issued its obligated 400,000 common shares and an additional 4,000 common shares as penalty, in lieu of sale of 400,000 Special Warrants to a Canadian accredited investor for $404,000 paid on December 15, 2005. Each Special Warrant entitled its holder to acquire one common share of the Company and one common share purchase warrant at no additional cost. The Company was obligated to have a registration statement become effective within 181 days of the closing. In the absence of a registration statement being declared effective within 181 days of the closing, the Company issued an additional 4,000 common shares to the Canadian accredited investor at no extra cost as a penalty. The Company expensed an amount of $5,000 to registration rights penalty expense under the heading General and Administration and credited this to Additional Paid in Capital. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
On December 28, 2006, the Company completed a private placement of 2,823,049 flow-through special warrants (which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at a price of $0.90 (CDN$1.05) per warrant and 334,218 unit special warrants at a price of $0.77 (CDN$0.90) per warrant for aggregate gross proceeds to the Company of $2,801,610 (CDN$3,264,996). Each flow-through special warrant entitles the holder to acquire, for no additional consideration, one common share of the Company. Each unit special warrant entitles the holder to acquire, for no additional consideration, one common share and one common share purchase warrant of the Company. Each common share purchase warrant entitles the holder to acquire one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date. In connection with this private placement, the Company agreed to file a prospectus in Canada qualifying the issuance of the common shares and warrants issuable upon the exercise of the special warrants as well as those common shares issuable on exercise of the common share purchase warrants. In addition, the Company agreed to file a registration statement in the United States covering the re-sale of common shares underlying the units and warrants by the respective shareholders. In the event the Company fails to obtain effectiveness for the final prospectus and the registration statement by February 26, 2007 (60 days from the closing date), each flow-through special warrant will entitle the holder to acquire 1.1 common shares on exercise thereof and each unit special warrant will entitle the holder to acquire 1.1 common shares and 1.1 common share purchase warrants on exercise thereof. The flow-through and unit special warrants will be automatically exercised on the earlier of (i) the third business day after the issuance of a receipt for the final prospectus and the effectiveness of the registration statement, or (ii) the four month anniversary of the closing date of the private placement. The Company subsequently declined to file a prospectus in Canada but did file the registration statement in the United States. As a result of the Company’s decision not to file a prospectus in Canada, primarily because of the cost involved, the Company was obligated to pay the penalty described herein to the holders of the securities issued in the private placement. On closing, Northern Securities Inc., the lead agent received a cash commission of $171,164 (CDN$198,550) as well as 169,042 flow-through compensation options and 23,395 unit compensation options. In addition, as part of the private placement, Limited Market Dealer Inc. received a cash commission of $25,862 (CDN$30,000) as well as 28,571 flow-through compensation options and Novadan Capital Ltd. received a cash payment of $28,362 (CDN$32,900) as well as 32,900 unit compensation options. Each flow-through compensation option entitles the holder to acquire, for no additional consideration, one flow-through compensation warrant, each exercisable into one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. Each unit compensation option entitles the holder to acquire, for no additional consideration, one unit compensation warrant, each exercisable at US$0.81 (CDN$0.941) into one common share and one common share purchase warrant of the Company at a price of US$0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. As a result of the penalty each flow-through compensation option granted to Northern Securities, Inc. will entitle the holder to acquire 1.1 flow-through compensation warrants on exercise thereof and each unit compensation option will entitle the holder to acquire 1.1 unit compensation warrants on exercise thereof. The Company will use the gross proceeds from the sale of flow-through special warrants for the exploration and development of its properties, located in the Mayo Mining District of Yukon, Canada. The Company will use the net proceeds from the sale of unit special warrants for general working capital purposes. The private placement was exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) pursuant to an exemption afforded by Regulation S promulgated under the Securities Act (“Regulation S”).
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On December 12, 2006, a former officer of the Company exercised 50,000 stock options at a price of $0.75 per share for a total of $37,500. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
On December 6, 2006, the Company issued to Atna Resources Ltd 133,334 common shares in the amount of $100,000 as part of a property payment for the Marg Property as provided in the Marg Acquisition Agreement. The property payment also included a cash payment in the amount of $86,805 (CDN$100,000). The entire payment of $186,805 was expensed in the consolidated statements of operations. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
In October of 2006 the Company completed a private placement of 550,000 units for consideration of $550,000. The units each consisted of (a) one common share of the Company and (b) one 2-year warrant to purchase a common share at a price of $1.50 per share for the first twelve (12) months from the date of closing and thereafter $2.00 per share for the remainder of the two-year term of the warrant. The purchasers of the units were non-U.S persons and the offering was conducted entirely in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. Each of the purchasers executed a subscription agreement in which they agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States. A finder’s fee of 6% and reimbursement of all expenses (subject to a cap) was paid to Novadan Capital Ltd., a Toronto, Ontario limited market dealer (“Novadan”) in connection with this private placement. On November 27, 2007, the board of directors extended the expiry date of the warrants to October 4, 2009.
In October of 2006, the Company completed another brokered private placement of 400,000 units where each unit consisted of a common share and a share purchase warrant. The units were priced at $1.00 per unit for a total of $400,000. The Company paid a finders fee equal to 6% of the gross proceeds and reimbursed expenses for 3% of the total consideration. The warrants have a two-year term and are exercisable at $1.50 per share in the first twelve months of the term and $2.00 per share in the remaining twelve months of the term. Closing of this placement required Toronto Stock Exchange approval. Conditional approval was given by the Toronto Stock Exchange on August 29, 2006. The purchaser of the units was a single accredited investor. The private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D. On November 27, 2007, the board of directors approved the extension of the expiry date of the share warrants to October 4, 2009.
On September 7, 2006, an officer of the Company exercised 24,000 stock options at a price of $0.75 per share for a total of $18,000. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
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On August 11, 2006 the Company issued 817,980 restricted shares in total to three consultants for services relating to business promotion and development. These consultants assisted management in the preparation of financial offerings and in arranging meetings and making presentations to the brokerage community and institutional investors in both the United States and Canada. Except for 342,780 common shares which were earned by these consultants as of October 31, 2006, the balance of 475,200 common shares were held in escrow to be released to each consultant in 8 monthly installments of 19,800 common shares commencing November 1, 2006. Out of 475,200 common shares held in escrow, the Company received back 356,400 common shares for cancellation. The issuance was exempt from registration under the Securities Act of 1933, pursuant to an exemption afforded by Regulation S.
On July 17, 2006 the Company issued 61,171 common shares for the exercise of 61,171 warrants at $0.88 (CDN$1.00) from a warrant holder in consideration of $53,824 (CDN$61,171). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On July 7, 2006 the Company issued 43,166 common shares and paid $80,501 (CDN$90,000) in cash in settlement of a property payment for the Mount Hinton Property. The shares represented payment of $53,845 (CDN $60,000) and were valued at $1.25 (CDN$1.39) each. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with the Hinton Syndicate and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On July 7, 2006 the Company issued 64,120 common shares for the exercise of 64,120 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $57,869 (CDN$64,120). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 29, 2006 the Company issued 158,090 common shares for the exercise of 158,090 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $141,632 (CDN$158,090). The securities were issued to a Canadian investor pursuant to an exemption under Regulation S.
On June 28, 2006 the Company issued 17,971 common shares for the exercise of 17,971 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $15,939 (CDN$17,971). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 28, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $38,895 (CDN$43,667). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 28, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder (and former officer of the Company) in consideration of $14,253 (CDN$16,000). The holder of the warrants was an accredited investor. The securities were issued to a Canadian investor pursuant to an exemption under Regulation S.
On June 22, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $39,368 (CDN$43,667). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 30, 2006 the Company issued 141,599 common shares for the settlement of an accrued liability to an ex officer and director. The accrued severance amount of $113,130 (CDN$128,855) was converted to 141,599 common shares at $0.80 (CDN$0.91). The former officer is an accredited investor and a Canadian citizen. The issuance was undertaken pursuant to an exemption from registration under Regulation D. The former officer was an accredited investor pursuant to Rule 501 of Regulation D (both in terms of net worth and as an executive of the Company).
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On May 29, 2006 the Company issued 10,000 common shares for the exercise of 10,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $8,987 (CDN$10,000). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 29, 2006 the Company issued 45,045 common shares for the exercise of 45,045 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $40,450 (CDN$45,045). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 29, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder (a former Canadian director of the Company) in consideration of $14,280 (CDN$16,000). The issuance of these shares was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation D. The holder of the warrant was an accredited investor pursuant to Rule 501 Regulation D (both in terms of net worth and as an executive of the Company).
On April 11, 2006, a Canadian director of the Company exercised his option to purchase 10,000 common shares at the option price of $0.55 per share. The Company received payment and issued 10,000 common shares. The issuance of these shares was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On March 28, 2006 the Company completed a brokered private placement through the issuance of 5,331,327 common share units at a price of $0.60 per unit for gross proceeds of $3,198,799. The Company also completed a private placement through the issuance of 25,000 so-called “flow-through” shares at a price of $0.75 per share for gross proceeds of $18,750. “Flow-through” shares carry certain tax benefits to shareholders who are Canadian tax payers. The Company must use the proceeds from the placement of “flow-through” securities for exploration and development programs in order to enable the holders of “flow-through” shares to derive the tax benefits in Canada. Each common share unit consists of one share and one-half of one common share purchase warrant. Each whole common share purchase warrant entitles the holder to purchase one common share at $0.90 per share for a period expiring on March 28, 2008. Novadan (or its permitted assignees) received a commission in connection with this private placement consisting of cash equal to 9% of the proceeds of the private placement in Canada for $289,579 and 533,133 broker’s warrants equaling 10% of the number of common share units sold. Each broker warrant entitles Novadan or its permitted assigns to purchase common shares and one-half share purchase warrant for $0.60 until March 28, 2008. Each full warrant is then exercisable for $0.90. In addition, Yukon Gold paid all of Novadan’s expenses related to the private placement, subject to a cap of $20,000. The purchasers of 3,873,993 of these units were non-U.S persons pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act of 1933, as amended (the “Securities Act”). Each purchaser in the Canadian private placement executed a subscription agreement in which they agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States. The Purchasers of 1,482,334 of these units were United States citizens, all of whom were accredited investors as that term is used in Regulation D. The U.S. private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D promulgated pursuant to the Securities Act (“Regulation D”). As part of the agreement with Novadan in connection with this offering, the Company granted to Novadan a right-of-first refusal to act as underwriter or best-efforts placement agent in connection with any subsequent public or private offering by the Company within eighteen months of the closing. In addition, Yukon Gold entered into a Consulting Agreement with Novadan for ongoing financial and strategic advice. As compensation under the Consulting Agreement, Yukon Gold agreed to issue to Novadan 240,0007.5 shares of its common stock such shares to be issued in equal installments over the twelve-month period of the Consulting Agreement. This Consulting Agreement was terminated as of October 23, 2006. On December 19, 2006, Yukon Gold issued 160,000 shares to Novadan. On November 27, 2007, the board of directors approved the extension of the expiry dates of theand 7.5 warrants issued in connection with this financing to March 28, 2009.
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On January 11, 2006 a holder converted promissory notes of the Company on their due dates and the Company issued 101,150 common shares and 50,000 warrants covering the principal amounts of $75,000 andfor each Preferred Membership interest in the amount of $1,533 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 30, 2005, Yukon Gold completed a private placement of 200,000 flow-through special warrants to a single investor in Canada for consideration of $180,000 (CDN$205,000)VetaNova Solar Partners, LLC (“VSP”). Each such flow-through special warrant entitles the holder to acquire one “flow-through” common share of the Company for no additional consideration. So-called “flow-through” shares carry certain tax benefit to Canadian holders. On December 19, 2006 the Company issued 200,000 common shares. The purchaser of the flow-through special warrants was a non-U.S person pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On December 15, 2005, the Company completed the sale of 400,000 special warrants to a single investor in Canada at a purchase price of $1.01 per special warrant for total consideration of $404,000. Each special warrant entitles the holder to purchase one common share of the Company and one additional common share purchase warrant at no additional cost. On January 12, 2007 the warrants were exercised and the Company issued 404,000 common shares (which included penalty shares). The purchaser of the special warrants was a non-U.S person pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On December 7, 2005 an accredited investor converted promissory notes of the Company on their due dates and the Company issued 34,306 common shares and 17,001 warrants covering the principal amounts of $25,500 and interest in the amount of $409 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 7, 2005 the board of directors authorized the issuance of 10,000 common shares to a shareholder upon the exercise of 10,000 warrants in consideration of $8,772 (CDN$10,000). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 6, 2005 the board of directors authorized the issuance of 133,333 common shares valued at $100,000 for property payment to Atna Resources Ltd., along with a cash payment of $43,406 (CDN$50,000) as per terms of the Marg Acquisition Agreement. The common shares along with the cash payment were delivered to Atna Resources Ltd. on December 12, 2005. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
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On December 5, 2005, the Company completed a private placement of 150,000 common shares and 150,000 warrants to a single accredited investor for consideration of $151,500. Each common share was priced at $1.00 and each warrant at $0.01. Each warrant entitles the holder to purchase one common share of the CompanyCompany’s common stock at an exercisea price of $1.00 for a period of one year from the date of issuance. This private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On November 9, 2005, an accredited investor converted a promissory note on its due date and the Company issued 76,525 common shares and 37,500 warrants covering the principal amount of $56,250 and interest in the amount of $1,143 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On October 18 and 24, 2005 the Company issued a total of 59,547 common shares and 29,167 warrants covering the principal amount of $43,750, plus interest of $910, on conversion of a convertible promissory note issued on October 6, 2004. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On October 18, 2005 the Company authorized the issuance of 14,000 common shares for the exercise of 14,000 warrants from a warrant holder in consideration of $12,000. The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On August 31, 2005, the Company accepted subscriptions from four accredited investors and one accredited corporation, all residents of Canada, for a total of 200,000 units priced at $0.55$0.20 per unit for a total of $110,000. Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full-share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring August 31, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On August 29, 2005, the Company completed the sale of 149,867 units at $0.55 per unit to a Canadian director of the Company for $82,427 (CDN$100,000). Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full-share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring on August 5, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act.
On August 26, 2005 the board of directors approved the issuance of 490,909 units at $0.55 per unit to J.L. Guerra, Jr., then an arms length accredited shareholder for a total of $270,000. Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full share purchase warrant entitles the holder to purchase one common share at $1.00 per share, after one year and seven days following closing, for a period of two (2) years following such date. The Company received $20,000 of the subscription price on August 12, 2005 as a loan to be applied to the subscription price and $100,000 on September 15, 2005 and a promissory note for $150,000, dueany time on or before October 1, 2005, for the balance of the subscription price. The promissory note was paid in full by the due date. Mr. Guerra subsequently became a director of the Company on November 2, 2005 and then became chairman of the board on July 11, 2006. Mr. Guerra is an accredited investor. This private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
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On August 25, 2005 the Company entered into a Consulting Agreement with Endeavor Holdings, Inc. (“Endeavor”), based in New York, New York to assist the Company in raising capital. Under the terms of this agreement the Company agreed to pay Endeavor 150,000 common shares at the rate of 25,000 shares per month. Either party could cancel the agreement upon 30 days notice.September 20, 2022. The Company issued 150,000 common shares valued at $130,500 to Endeavor. Endeavor is an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On August 23, 2005 the board of directors approved the issuance of 24,336 units to an arms length investor and 12,168 units to an officer of the Company at $0.55 per unit, in settlement of an accounts payable for services, for a total of $20,077 (CDN$24,398). Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring on August 15, 2007. The issuance of these securities was undertaken pursuant to negotiated agreements and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On August 5, 2005 the board of directors authorized the issuance of 369,215 common shares and 184,608 share purchase warrants in settlement of a demand promissory note in the amount of $200,000 plus interest of $3,068.25. Each common share was priced at $0.545 and each full warrant at $0.01. Each share purchase warrant entitles the holder to purchase one common share for $1.00 per share on or before August 5, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On March 2, 2005 the Company issued 76,204 common shares on conversion of a convertible promissory note. The holder of the promissory note was an accredited investor. The issuance of shares was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On March 1, 2005 the Company issued 133,333 common shares to Atna as a property payment in the amount of $100,000 for the Marg Property. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
- 55 -
Purchase Warrants
The following table summarizes the warrants outstanding as of the year ended April 30, 2008.
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| Number of Warrants Granted |
| Exercise Prices $ |
| Expiry Date |
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Outstanding at April 30, 2006 and average exercise price |
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| 4,655,270 |
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| 0.88 |
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Granted in year 2006-2007 |
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| 950,000 |
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| 2.00 |
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| October 4, 2009 |
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Granted in year 2006-2007 |
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| 367,641 |
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| 0.90 |
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| December 28, 2008 |
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Granted in year 2006-2007 |
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| 276,011 |
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| 0.81 |
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| December 28, 2008 |
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Exercised in year 2006-2007 |
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| (306,773 | ) |
| (0.89 | ) |
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Exercised in year 2006-2007 |
|
| (107,787 | ) |
| (0.90 | ) |
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Exercised in year 2006-2007 |
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| (61,171 | ) |
| (0.88 | ) |
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Expired in year 2006-2007 |
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| (171,168 | ) |
| (1.25 | ) |
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Expired in year 2006-2007 |
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| (186,320 | ) |
| (1.00 | ) |
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Cancelled |
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| — |
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Outstanding at April 30, 2007 and average exercise price |
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| 5,415,703 |
| $ | 0. 97 |
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Granted in year 2007-2008 |
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| 1,111,665 |
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| 0.60 |
|
| August 16, 2009 |
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Granted in year 2007-2008 |
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| 315,296 |
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| 0.70 |
|
| August 16, 2009 |
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Granted in year 2007-2008 |
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| 1,414,554 |
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| 0.60 |
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| November 16, 2009 |
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Granted in year 2007-2008 |
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| 621,626 |
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| 0.70 |
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| November 16, 2009 |
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Granted in year 2007-2008 |
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| 250,000 |
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| 0.24 |
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| December 15, 2012 |
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Granted in year 2007-2008 |
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| 250,000 |
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| 0.24 |
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| June 15, 2013 |
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Exercised in year 2007-2008 |
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| — |
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| — |
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Expired in year 2007-2008 |
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| (377,794 | ) |
| (1.00 | ) |
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Cancelled in year 2007-2008 |
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| — |
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| — |
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Outstanding at April 30, 2008 and average exercise price |
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| 9,001,050 |
| $ | 0.86 |
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The warrants do not confer upon the holders any rights or interest as a shareholder of the Company.
On November 27, 2007 the board of directors approved the extension of the expiry dates of the following warrants by one (1) year: (a) 2,665,669 warrants expiring on March 28, 2008 exercisable at $0.90 per warrant to March 28, 2009, having a fair value of $76,483; (b) 950,000 warrants expiring on October 4, 2008 which are exercisable at $2.00 per warrant to October 4, 2009, having a fair market value of $5,144; and (c) 533,133 Broker warrants expiring on March 28, 2008 exercisable at $0.60 per unit to March 28, 2009 having a fair market value of $28,645.
Outstanding Share Data
As of August 14, 2008, there are 33,650,629 shareswould issue 37,888,461shares of common stock outstanding, held by 708 shareholders of record.
Of the options to purchase common shares issued to the Company’s directors, officers and consultants under the Company’s 2003 stock option plan, 1,566,000 remained outstanding with exercise prices ranging from $0.55 to $1.19 and expiry dates ranging from December 15, 2009 to January 20, 2011. If exercised, 1,566,000 common shares of the Company would be issued, generating proceeds of $1,383,660.
Of the options to purchase common shares issued to the Company’s directors, officers and consultants under the Company’s 2006 stock option plan, 1,837,500 remained outstanding with exercise prices ranging from to $0.20 (CDN$0.20) to $0.39 (CDN$0.39) and expiry dates ranging from September 28, 2012 to April 8, 2013. If exercised, 1,837,500 common shares of the Company would be issued, generating proceeds of $548,923 (CDN$552,875). Subsequent to the year end, options to issue 200,000 shares were cancelled on June 11, 2008 due to the resignation of an officer of the Company.
- 56 -
On April 30, 2008, 9,001,050 share purchase warrants were exercisable with exercise prices ranging from $0.24 (CDN$0.24) to $2.00 and expiring between August 22, 2008 and December 19, 2012. If exercised, 9,001,050 common shares would be issued, generating proceeds of $7,727,118.
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| Number of securities to be issued upon exercise of outstanding options, warrants and rights |
| Weighted-average exercise price of outstanding options, warrants and rights |
| Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) |
| |||
Equity compensation plans approved by security holders |
|
| 12,404,550 |
| $ | 0. 78 |
|
| 1,061,544 |
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Equity compensation plans not approved by securities holders |
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| N/A |
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| N/A |
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| N/A |
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Total |
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| 12,404,550 |
| $ | 0.78 |
|
| 1,601,544 |
|
On November 27, 2007 the board of directors approved the extension of the expiry dates of the following warrants included in the above table by one (1) year: (a) 2,665,669 warrants expiring on March 28, 2008 exercisable at $0.90 per warrant to March 28, 2009, having a fair value of $76,483; (b) 950,000 warrants expiring on October 4, 2008 which37,888,461warrants if all Preferred Membership interests are exercisable at $2.00 per warrant to October 4, 2009, having a fair market value of $5,144; and (c) 533,133 Broker warrants expiring on March 28, 2008 exercisable at $0.60 per unit to March 28, 2009 having a fair market value of $28,645.
Our common stock is traded on the Over the Counter Bulletin Board sponsored by the National Association of Securities Dealers, Inc. under the symbol “YGDC.” The Over the Counter Bulletin Board does not have any quantitative or qualitative standards such as those requiredexchanged for companies listed on the Nasdaq Small Cap Market or National Market System. Our high and low sales prices of our common stock during the fiscal years ended April 30, 2008 and 2007 are as follows.
These quotations represent inter-dealer prices, without mark-up, mark-down or commission and may not represent actual transactions.
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FISCAL YEAR 2008 |
| HIGH |
| LOW |
| ||
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| |||||
First Quarter |
| $ | 0.69 |
| $ | 0.37 |
|
Second Quarter |
| $ | 0.59 |
| $ | 0.33 |
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Third Quarter |
| $ | 0.50 |
| $ | 0.21 |
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Fourth Quarter |
| $ | 0.30 |
| $ | 0.18 |
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FISCAL YEAR 2007 |
| HIGH |
| LOW |
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| |||||
First Quarter |
| $ | 1.70 |
| $ | 0.95 |
|
Second Quarter |
| $ | 1.36 |
| $ | 0.81 |
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Third Quarter |
| $ | 1.10 |
| $ | 0.58 |
|
Fourth Quarter |
| $ | 0.70 |
| $ | 0.35 |
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- 57 -
As of April 19, 2006, our stock began trading on the Toronto Stock Exchange under the symbol “YK.” The high and low trading prices for our common stock for the fiscal year periods indicated below are as follows:
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Our Transfer Agent
Our transfer agent is Equity Transfer and Trust Services, Inc. with offices at 200 University Avenue, Suite 400, Toronto, Ontario M5H 4H1. Their phone number is 416-361-0152. The transfer agent is responsible for all record-keeping and administrative functions in connection with the common shares of stock.
Dividends
The Company has not declared any cash dividends on our common stock. The Company plans to retain any future earnings, if any, for exploration programs, administrative expenses and development of the Company and its assets.
Securities Authorized for Issuance Under Equity Compensation Plans.
See section entitled “STOCK OPTION PLAN” herein.
- 58 -
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS
The following table represents the Board of Directors and the senior management of the Company as of the date of this Prospectus. Each director will serve until the next meeting of shareholders or until replaced. Each officer serves at the discretion of the Board of Directors. Each individual’s background is of material importance to Yukon Gold and is described below.
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Reorganization of Officers and Directors
On August 1, 2008 Kathy Chapman was appointed Chief Administrative Officer.
- 59 -
On July 3, 2008 Kathy Chapman was appointed Interim Corporate Secretary to replace Lisa Rose while she is on maternity leave.
On March 18, 2008 the Company entered into a consulting agreement with Gary Cohoon (the “Cohoon Agreement”) pursuant to which Mr. Cohoon was retained as Vice-President, Exploration, of the Company. The Cohoon Agreement has a one-year term commencing on March 18, 2008 and is automatically renewable thereafter, unless terminated pursuant to its terms. Pursuant to the Cohoon Agreement, Mr. Cohoon will receive an annual consulting fee of $139,000 (CDN$140,000). Additionally, Mr. Cohoon received 200,000 options to purchase shares of the Company’s common stock (the “Cohoon Options”). and warrants.
The Cohoon Options fully vested upon issuance.Preferred Membership interests are entitled to priority distributions equal to 80% of solar investment tax credit and bonus depreciation for commercial solar illumination and solar property.
On February 21, 2008 the Company accepted the resignation effective March 11, 2008
If a member of Mr. Stewart Fumerton as Vice President, Exploration. There were no disagreements between Mr. Fumerton and the Company with respect to the Company’s operations, policies or practices.
On February 21, 2008, G.E. (Ted) Creber, Q.C. was appointed to fillVSP exchanges a vacancy on the Board of Directors.
Effective as of December 15, 2007 the Company entered into a consulting agreement with Ronald Mann (the “Mann Agreement”), pursuant to which Mr. Mann was retained as the Company’s President and Chief Executive Officer. The board of directors of the Company appointed Mr. Mann to fill a vacancy on the board of directors, also effective as of December 15, 2007. The Mann Agreement has a one-year term commencing on December 15, 2007, and is automatically renewable thereafter, unless terminated pursuant to the terms of the Mann Agreement. Mr. Mann and the Company shall indicate their respective intentions to renew the term after the passage of eight (8) months from the date of the Mann Agreement. Pursuant to the Mann Agreement, Mr. Mann will receive an annual consulting fee of $148,928 (CDN$150,000). In addition, Mr. Mann received 500,000 warrants to purchasePreferred Membership Interest in VSP for shares of the Company’s common stock (the “Mann Warrants”). The Mann Warrants shall haveand warrants the member will recognize a term of 5 years and an exercise price oftaxable gain or loss based upon the fair market value of the Company’s common stock on their date of issuance. 250,000and warrants received at the time of the Mann Warrants were fully vested upon issuance, withexchange verses the remaining 250,000 vesting 6 monthsmember’s tax basis in the Preferred Membership interest.
The forgoing does not address ant U.S. state or local or foreign tax consequence of the exchange.
We have not requested and no not intend to request a ruling from the Internal Revenue Service or an opinion of tax counsel regarding the tax consequences of the exchange under U.S. tax laws. As a result, the forgoing is not binding on the Internal Revenue Service or the courts, and we cannot assure you that the IRS or a court will not take a contrary position.
Members of VSP that are interested in exchanging their Preferred Membership interests should consult their tax advisors concerning the tax consequences of the exchange to their personal tax situation.
As of the date of issuance, on June 15, 2008 subsequentthis Prospectus the Preferred Membership Interests in VSP were held by 16 persons.
The exchange offer is not contingent upon any fixed number of Preferred Membership Interests being tendered,
The exchange offer will be open for a period ending six months after the date of this prospectus, unless the Company, by written notice to the year ended April 30, 2008.
As of December 18, 2007 the Company entered into a consulting agreement with Cletus Ryan (the “Ryan Agreement”) pursuant to which Mr. Ryan was retained as the Company’s Vice President, Corporate Development. The Ryan Agreement has a six-month term commencing on December 18, 2007 and is automatically renewable thereafter, unless terminated pursuant to the termsholders of the Ryan Agreement. On March 7, 2008Preferred Membership Interests, extends the Company renewed the Ryan Agreementexchange offer.
Any person that wants to exchange Preferred Membership Interest for an additional six months.
Yukon Gold accepted the resignation of Paul A. Gorman as Chief Executive Officer and as a director on December 13, 2007. There were no disagreements between the Company and Mr. Gorman with respect to the Company’s operations, policies or practices.
Yukon Gold accepted the resignation of Chester (Chet) Idziszek as of October 22, 2007. There were no disagreements between the Company and Mr. Idziszek with respect to the Company’s operations, policies or practices.
On June 1, 2007 the Company appointed Mr. Stewart Fumerton as Vice President, Exploration.
As of October 24, 2006, Paul Gorman became the Chief Executive Officer of the Company following the resignation of Howard Barth as Chief Executive Officer and President. Mr. Barth continues as a Director of the Company. Prior to becoming the Company’s Chief Executive Officer, Mr. Gorman was the Company’s Vice President – Corporate Development. As of October 24, 2006, Mr. Gorman also became a director of the Company. There were no disagreements between the Company and Mr. Barth with respect to the Company’s operations, policies or practices.
- 60 -
As of June 29, 2006, Ken Hill resigned as President and CEO of the Company and was replaced by Howard Barth as President and CEO. Mr. Barth is also a director of the Company. Mr. Hill became Vice President – Mining Operations of the Company. Subsequently, Mr. Hill resigned as Vice President – Mining Operations as of December 18, 2006, but remained on the Board of Directors. There were no disagreements between the Company and Mr. Hill with respect to the Company’s operations, policies or practices. Mr. Hill, who was a Director as of December of 2004, was appointed to the position of President and CEO as of January 17, 2006 following the resignation of W. Warren Holmes as CEO and the resignation of Brian Robertson as President.
Yukon Gold accepted the resignation of W. Warren Holmes as a director and Chairman of the board of directors and his resignation as a director and officershares of the Company’s wholly-owned subsidiary, Yukon Gold Corp., an Ontario corporation, in each case effective as of July 11, 2006. As of that date, J.L. Guerra, Jr. became Chairman of the Board of Directors of the Company. There were no disagreements betweencommon stock and warrants should send a letter to the Company and Mr. Holmes with respect toindicating the Company’s operations, policies or practices.
As of January 17, 2006, Brian Robertson resigned as a director and President of the Company. There were no disagreements between the Company and Mr. Robertson with respect to the Company’s operations, policies or practices.
On January 17, 2006, Warren Holmes resigned as Chief Executive Officer of the Company. There were no disagreements between the Company and Mr. Holmes with respect to the Company’s operations, policies or practices.
As of November 17, 2005, Rene Galipeau resigned as a director and as the Chief Financial Officer of the Company. He was appointed to that position as of May 11, 2005. His position as chief financial officer was filled by Rakesh Malhotra. The vacancy on the board was filled by the appointment of Chet Idziszek. There were no disagreements between the Company and Mr. Galipeau with respect to the Company’s operations, policies or practices.
As of November 7, 2005, Paul Gorman was appointed to the position of Vice President – Corporate Development and subsequently on October 24, 2006, was appointed as the Chief Executive Officer and as a director.
As of November 2, 2005, J.L. Guerra, Jr. was appointed to fill a vacancy on the board of directors of the Company.
As of September 7, 2005, Lisa Rose was appointed to the position of Corporate Secretary.
As of May 11, 2005, Stafford Kelley resigned as a director and as Secretary-Treasurer of the Company. There were no disagreements between the Company and Mr. Kelley with respect to the Company’s operations, policies or practices.
As of May 30, 2005, Richard Ewing resigned as a director of the Company. There were no disagreements between the Company and Mr. Ewing with respect to the Company’s operations, policies or practices. Robert (“Dutch”) Van Tassell was appointed to fill the vacancy on the board of directors left by Mr. Ewing as of May 30, 2005.
Of our six directors, three directors are independent directors. The Company believes its new board members add strength to the management team.
The following is a description of each member of our Board of Directors and our management.
- 61 -
Ronald K. Mann, Director, Chief Executive Officer and President
Mr. Mann has 25 years of experience in the investment industry with an emphasis, in the last decade, on mining and mining related companies. In the last three years Mr. Mann held an executive position at a Toronto-based asset manager and merchant bank involved extensively in Mining. Mr. Mann has been a member of the Law Society of Upper Canada since 1977. In the late 1980’s, Mr. Mann was Assistant General Manager Corporate Finance, Investment Bank, CIBC, as well as Vice President and Director with CIBC Securities Inc. Mr. Mann is 58 years old.
J.L. Guerra, Jr., Director, Chairman of the Board
Mr. Guerra has over twenty years of experience operating his own businesses in the real estate brokerage, acquisition and development business in San Antonio, Texas. Mr. Guerra has acquired and sold industrial buildings, warehouses, office buildings and raw land for investors and investment entities. His current projects include acquisition, planning and development of residential, golf and resort properties, specifically Canyon Springs in San Antonio, Texas. Mr. Guerra also has experience with venture capital projects and has raised substantial capital for numerous projects in mining, hi-tech and other areas. Mr. Guerra lives in San Antonio, Texas. Mr. Guerra is 52 years old.
Howard Barth, Director
Howard Barth became President and CEO of the Company on June 29, 2006 and resigned as such as of October 24, 2006. Mr. Barth continues with the Company as a Director. Mr. Barth graduated with a B.A. in Geography at York University, in Toronto, Ontario. He continued his studies at York University through the Schulich School of Business and graduated with a Masters degree in Business Administration in 1976. Upon graduation Mr. Barth worked for William Eisenburg & Company (now PricewaterhouseCoopers), a large Toronto accounting firm and attained his C.A. designation. After spending the next few years working with different firms in the Greater Toronto area, Mr. Barth started his own accounting practice in 1984 and subsequently expanded his firm by adding two partners. In his 25 years of public practice Mr. Barth has had direct involvement in a number of industries andPreferred Membership Interests to be exchanged.
A person is familiar withnot required to exchange all aspects of accountingtheir Preferred Membership Interests for small to medium sized businesses. His diverse clientele includes businesses in the construction, retail, manufacturing, and restaurant sectors. Since 1979 Mr. Barth has been a member of the Canadian Institute of Chartered Accountants and the Ontario Institute of Chartered Accountants. Mr. Barth is also a member of the board of directors of the following corporations: Nuinsco Resources, New Oriental Energy & Chemical Corp., Uranium Hunter Corporation and Orsus Xclent Technologies Inc. Mr. Barth is 56 years old.
Robert E. “Dutch” Van Tassell, Director
Robert E. “Dutch” Van Tassell was born in 1935 in Digby, Nova Scotia and graduated with a degree in Geology from Mount Allison University in 1958. Mr. Van Tassell began his mining career in 1956 as a summer student with Giant Yellowknife Mines, in the North West Territories of Canada. Mr. Van Tassell remained with Giant Yellowknife Mines from 1956 to 1962 where he was involved with mining and exploration geology. In 1962, Mr. Van Tassell was employed with Denison Mines located in Elliot Lake, Ontario for a short period of time as an underground geologist. In 1963 he joined United Keno Hill Mines in Yukon, Canada and was a key participant in the discovery of the Husky Mine in 1967, which produced over 17 million ounces of silver. In 1969 Mr. Van Tassell set up a Yukon regional exploration office in Whitehorse which in 1972 discovered the Minto Copper Deposit, employing helicopter supported two man prospecting crews in tree covered areas. While in Whitehorse Mr. Van Tassell served as a director for the Yukon Chamber of Mines for eleven years, two as its president. He also served four terms on the Northern Resources Conference which is held every three years and sponsored by the Yukon Chamber of Mines and Whitehorse Chamber of Commerce, two of these as Chairman. He also served as Chairman of the Whitehorse branch of the Canadian Institute of Mining and Metallurgy (the “CIM”). He also gave introductory and advanced prospecting courses for the Chamber of Mines. In 1982 Mr. Van Tassell joined Dickenson Mines in Toronto, Ontario as Vice President of Exploration. In 1984 he was involved with the discovery of additional reserves at the then active silver, lead, zinc Silvana Mine at Sandon, B.C. In 1988 he also played a part in Dickenson’s acquisition of the Wharf Mine in South Dakota. While in Toronto Mr. Van Tassell also served as a Board member of the Prospector’s and Developers Association of Canada (PDAC) from 1984 to 1993 serving as Chairman on the Program and Environmental Committees. Mr. Van Tassell is a Life member of the CIM and a member of The Geological Association of Canada. In March, 2000 he was presented with a lifetime Achievement Award by the PDAC for his contribution to the Mining Industry. In 2007 he was inducted into the Prospector’s Honour Roll by the Yukon Prospector’s Association, Mr. Van Tassell retired in 1998 to assist with family matters. Mr. Van Tassell is 73 years old. Mr. Van Tassell is also a director of Lexam Explorations Inc., Plato Gold Corp., Rupert Resources Ltd. and Finmetal Mining Ltd.
- 62 -
Ken Hill, Director
Mr. Hill came to Yukon Gold with over forty-five years of experience in the mining industry. Mr. Hill is a registered professional engineer and graduated with a degree in Geological Engineering from the Michigan Technological University. He also holds a diploma in Mining Technology from the Haileybury School of Mines.
Since the year 2000, Mr. Hill has provided independent consulting and project management services to the global minerals industry. Prior to his consulting practice, Mr. Hill held senior positions involving mine evaluation, mine design, mine development and mine operations with Inmet Mining Corp., Northgate Exploration Ltd., Dome Mines Group and J.S. Redpath Ltd. Mr. Hill is 69 years old.
G.E. (Ted) Creber, Q.C., Director
Mr. Creber was appointed to fill a vacancy on the Company’s Board of Directors on February 21, 2008. He currently is an investor in, and is involved in management of, several private Canadian companies. He is a former managing director and President of George Weston Limited and President and CEO of the Consumers Gas Company (now Enbridge). He has at various times served as a director of a number of major Canadian companies including among others, George Weston Limited, Loblaw Groceterias Inc., Home Oil of Canada Limited, Canada Trust Company (now part of the Toronto Dominion Bank), Union Oil Company of Canada, Burns Foods Limited, International Pursuit Corporation and World Point Terminals Inc. Mr. Creber graduated from the University of Toronto with a degree in political science and economics and from Osgoode Hall with a degree in law. He was appointed a Queen’s Counsel in 1965. He has practiced law in the field of corporate and securities law with several major Canadian law firms. He is 80 years old.
Officers
Rakesh Malhotra, Chief Financial Officer
Mr. Malhotra is a United States certified public accountant and a Canadian chartered accountant with considerable finance and accounting experience. Mr. Malhotra graduated with a Bachelor of Commerce (Honours) from the University of Delhi (India) and worked for a large accounting firm A.F Ferguson & Co. (Indian correspondent for KPMG) and obtained his CA designation in India. Having practiced as an accountant for over 10 years in New Delhi, he moved to the Middle East and worked for 5 years with the highly successful International Bahwan Group of Companies in a senior finance position. Mr. Malhotra is a CPA (Illinois) and also holds a Canadian CA designation. He worked as a Chartered Accountant with a mid-sized Chartered Accounting firm in Toronto doing audits of Public Companies Mr. Malhotra has more than 20 years of experience in accounting and finance. Mr. Malhotra is 51 years old.
- 63 -
Kathy Chapman, Chief Administrative Officer
Kathy Chapman has over 30 years combined accounting and administrative experience in the manufacturing, franchising, banking, hospitality and junior mining exploration sectors. Mrs. Chapman has worked as the Accounting Manager of Yukon Gold and it’s wholly-owned Canadian subsidiary since their inception and was instrumental in the successful listing applications for the Company’s stock on both the OTC Bulletin Board and the TSX Stock Exchange. On August 1, 2008 the Company appointed Kathy Chapman as Chief Administrative Officer. Mrs. Chapman is 50 years old.
Cletus Ryan, Vice President, Corporate Development
Mr. Ryan has over twenty years in executive positions for several major fund companies and wealth management companies. Since 2000, he has assisted mining companies in financing their exploration activities. Mr. Ryan is 45 years old.
Lisa Rose, Corporate Secretary
Mrs. Rose (formerly Lisa Lacroix) has spent fourteen years working in a variety of fields ranging from retail to merchant banking. She attended Etobicoke Collegiate Institute and her studies focused on Business Administration and Law. Upon graduating in 1992 she began her career working for an accounting firm that specialized in Off-shore Investing and assisted in conducting seminars on the benefits of such investments.
In 1997 she began working for the Harten Group, a conglomerate of 11 companies owned by one family. The companies included a telecommunications firm, a natural gas provider, a private funding corporation (loans and mortgages), commercial/residential property management, an art gallery and professional race horses.
In 1999 Mrs. Rose joined Medallion Capital Corp. Beginning in January of 2005 Yukon Gold employed Lisa as a full time employee. She was appointed Corporate Secretary on September 7, 2005. Mrs. Rose is 33 years old.
Gary Cohoon, P Geo BSc. MBA, Vice President, Exploration
Mr. Cohoon is senior geologist with 30 years of international exploration and mining experience for uranium, gold, and base metals in North and South America. Mr. Cohoon is 58 years old.
- 64 -
The following table shows the compensation paid during the last three fiscal years ended April 30, 2008, 2007 and 2006 for the Chief Executive Officer, the Chief Financial Officer and the next three most highly compensated officers of the Company.
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|
| |||||||||
Kenneth Hill Former |
| 2008 |
| Nil |
| Nil |
| 13,530 |
| Nil |
| 250,000 |
| Nil |
| Nil |
President and CEO (1) |
| 2007 |
| Nil |
| Nil |
| 36,230 |
| Nil |
| Nil |
| Nil |
| Nil |
|
| 2006 |
| Nil |
| Nil |
| 14,755 |
| Nil |
| 150,000 |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W. Warren Holmes, |
| 2008 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
Former CEO (5) |
| 2007 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
|
| 2006 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rakesh |
| 2008 |
| Nil |
| Nil |
| 31,839 |
| Nil |
| 75,000 |
| Nil |
| Nil |
Malhotra |
| 2007 |
| Nil |
| Nil |
| 45,603 |
| Nil |
| Nil |
| Nil |
| Nil |
CFO (2) |
| 2006 |
| Nil |
| Nil |
| 15,107 |
| Nil |
| 250,000 |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rene |
| 2008 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
Galipeau |
| 2007 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
Former CFO (2) & (6) |
| 2006 |
| Nil |
| Nil |
| Nil |
| Nil |
| 250,000 |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lisa Rose |
| 2008 |
| 97,268 |
| Nil |
| Nil |
| Nil |
| 175,000 |
| Nil |
| Nil |
Corporate Secretary (3) |
| 2007 |
| 48,901 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
|
| 2006 |
| 25,858 |
| Nil |
| Nil |
| Nil |
| 76,000 |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Paul Gorman |
| 2008 |
| Nil |
| Nil |
| 181,906 |
| Nil |
| Nil |
| Nil |
| Nil |
Former CEO (4) |
| 2007 |
| Nil |
| Nil |
| 123,016 |
| Nil |
| 250,000 |
| Nil |
| Nil |
|
| 2006 |
| Nil |
| Nil |
| 34,440 |
| Nil |
| 200,000 |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Howard Barth |
| 2008 |
| Nil |
| Nil |
| 496 |
| Nil |
| 100,000 |
| Nil |
| Nil |
Former President & CEO (7) |
| 2007 |
| Nil |
| Nil |
| 49,610 |
| Nil |
| Nil |
| Nil |
| Nil |
|
| 2006 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald Mann |
| 2008 |
| Nil |
| Nil |
| 55,848 |
| Nil |
| 500,000 |
| Nil |
| Nil |
CEO (8) |
| 2007 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
2006 | Nil | Nil | Nil | Nil | Nil | Nil | Nil | |||||||||
Cletus Ryan | 2008 | Nil | Nil | 44,678 | Nil | 200,000 | Nil | Nil | ||||||||
VP - Corporate Development (9) | 2007 | Nil | Nil | Nil | Nil | Nil | Nil | Nil | ||||||||
|
| 2006 |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
| Nil |
Stewart Fumerton | 2008 | Nil | Nil | 70,155 | Nil | 200,000 | Nil | Nil | ||||||||
VP - Exploration (10) | 2007 | Nil | Nil | Nil | Nil | Nil | Nil | Nil | ||||||||
2006 | Nil | Nil | Nil | Nil | Nil | Nil | Nil |
- 65 -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company does not have a long term incentive plan, pursuant to which cash or non-cash compensation intended to serve as an incentive for performance (whereby performance is measured by reference to financial performance or the priceshares of the Company’s securities), was paid or distributed to any executive officers during the three most recent completed years.
- 66 -
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The Company has 33,650,629 shares of common stock issued and outstanding as at August 14, 2008. Consequently,warrants.
Certificates for purposes of describing shareholder voting rights, we have included in the table below the number of common shares of Yukon Gold Corporation, Inc. (Yukon Gold) held by the officers and directors of Yukon Gold. The last column of the table below reflects the voting rights of each officer and/or director as a percentage of the total voting shares (common shares of Yukon Gold) as of August 14, 2008.
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- 67 -
Name and Address |
| Number of Shares of |
| Percentage of Class Held | |
|
| ||||
|
|
|
|
|
|
Howard Barth |
| 5,500 |
|
| 0.01% of Yukon Gold |
16 Sycamore Drive |
|
|
|
| Common Shares |
Thornhill, ON L3T 5V4 |
|
|
|
|
|
|
|
|
|
|
|
Paul A. Gorman |
| 114,900 |
|
| 0.34% of Yukon Gold |
Former Director and CEO |
|
|
|
| Common Shares |
1308 Roundwood Cres. |
|
|
|
|
|
Oakville, ON L6M 4A2 |
|
|
|
|
|
|
|
|
|
|
|
Cletus J. Ryan |
| 181,000 |
|
| 0.54% of Yukon Gold |
Vice President, Corporate Development |
|
|
|
| Common Shares |
178 Weybourne Rd. |
|
|
|
|
|
Oakville, ON L6K 2T7 |
|
|
|
|
|
|
|
|
|
|
|
Gary A. Cohoon | 0 | 0% of Yukon Gold | |||
Vice President, Exploration |
|
|
|
| Common Shares |
1650 Philbrook Drive |
|
|
|
|
|
London, ON N5X 2V8 |
|
|
|
|
|
|
|
|
|
|
|
Kathy D. Chapman |
| 0 |
|
| 0% of Yukon Gold |
Chief Administrative Officer |
|
|
|
| Common Shares |
567 Paris Rd, RR#1 |
|
|
|
|
|
Paris, ON N3L 3E1 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL |
| 2,265,579 |
|
| 6.74% |
*Mr. Guerra’s controls 2,826,629 shares which include options, shares owned indirectly and shares over which he influences voting control. These 2,826,629 shares represent 8.4% of the Company’s issuedcommon stock and outstanding shares.
As a group Management and the Directors own 6.74%warrants will be sent to holders of the issued and outstanding sharesPreferred Membership Interests within ten days of Yukon Gold.receipt of the instruction letter.
16 |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONSSelling Shareholders
Year ended April 30, 2008
The Company and its subsidiary expensed a totalpersons listed in the following table plan to offer the shares shown opposite their respective names by means of $13,530 (CDN$13,627) in consulting fees to a corporation controlled by Kenneth Hill, a directorthis prospectus. The owners of the Company. The Company expensed $181,906 (CDN$183,875) to a corporation controlled by Paul Gorman the Company’s former CEO and director, $55,848 (CDN$56,250) to Ronald K. Mann, the Company’s current CEO and director, $70,155 (CDN$70,660) to Stewart Fumerton the Company’s former Vice President, Exploration, $14,236 (CDN$14,338) to Gary Cohoon the Company’s current Vice President Exploration, $44,678 (CDN$45,000) to Cletus Ryan the Company’s Vice President, Corporate Development and $ 31,839(CDN$32,275) to Rakesh Malhotra, the Company’s Chief Financial Officer. Also the Company paid a total of $97,268(CDN$97,968) to Lisa Rose, our Corporate Secretary. The Company expensed a total of $496 (CDN$500) for Audit Committee meeting fees to each of Howard Barth, Robert Van Tassell, G.E. Creber and J.L. Guerra, Jr. all directors of the Company.
No director participated in any private placements during the fiscal year ended April 30, 2008.
- 68 -
Year ended April 30, 2007
The Company and its subsidiary expensed a total of $36,230 (CDN$41,223) in consulting fees to a corporation controlled by Kenneth Hill, a director of the Company. In addition the Company paid $123,016 to a corporation controlled by Paul Gorman, the Company’s CEO and $45,603 to Rakesh Malhotra, the Company’s Chief Financial Officer. Also the Company paid a total of $48,901 (CDN$55,640) to Lisa Rose, our Corporate Secretary. The Company paid a total of $49,610 (CDN$55,650) in consulting fees to Howard Barth, a director of the Company.
Year ended April 30, 2006
The Company and its subsidiary expensed a total of $14,755 in consulting fees to a corporation controlled by Kenneth Hill, a director of the Company. Mr. Hill was Vice President - Mining Operations prior to his resignation on December 18, 2006. Mr. Hill remains as a Director of the Company. In addition the Company paid $34,440 to a corporation controlled by Paul Gorman, then the Company’s Vice President, Corporate Development and currently the Company’s CEO, and $15,107 to Rakesh Malhotra, the Company’s Chief Financial Officer. The Company issued 12,168 common share units at $0.55 per unit in settlement of a prior year accounts payable for the services rendered by Brian Robertson, a former president of the Company.
The directors participated in private placements during the year as follows:
| |
|
ORGANIZATION WITHIN THE LAST FIVE YEARS
History
The Company was incorporated in the State of Delaware on May 31, 2000 under the name, “RealDarts International, Inc.” The Company was formed to affect a plan of merger with a Florida corporation which was, at the time, negotiating to acquire marketing rights to an electronic scoreboard system for the game of darts. On August 4, 2000, the Company changed its name to “Optima 2000, Inc.” On August 29, 2000 it changed its name to “Optima International, Inc.” On September 27, 2000 the Company again changed its name to “Optima Global Corporation.” On February 5, 2001, the Company merged with the Florida Corporation that was pursuing the rights to the electronic scoreboard and the Company was the surviving corporation. In connection with that merger, the Company issued common stock to the shareholders of the Florida Corporation on a one-for-one basis. The Company terminated the plan to acquire the rights to the electronic scoreboard system after determining that there was an insufficient market for this product and that financing could not be obtained. On November 27, 2002, the Company changed its name to “Take 4, Inc.” with no specific business plan.
On October 29, 2003 the Company changed its name to “Yukon Gold Corporation, Inc.” On November 17, 2003, the Company concluded a series of transactions whereby it acquired 3,000,000 (100%) common shares of Yukon Gold Corp (hereinare referred to as “YGC”), a private Ontario Canada Corporation. registered to carry on business in the Province of Yukon. In consideration of this acquisition, the Company issued 4,027,932 common shares to the former shareholders of YGC, which represented 59.5% of the outstanding common shares of the company on that date.“selling shareholders”.
- 69 -
On December of 2004 the Company became a reporting issuer with the United States Securities and Exchange Commission (the “SEC”). The Company’s shares began to trade on the NASDAQ OTC Bulletin Board on January 9, 2005. The Company commenced trading on the Toronto Stock Exchange effective April 19, 2006.
On March 18, 2008 the shareholders of the Company approved and adopted an amendment to the Company’s Certificate of Incorporation increasing the total number of authorized shares of common stock to 150,000,000. The amendment was filed with the Delaware Secretary of State on March 20, 2008.
The following description is a summary of the material terms of our common stock. This summary is subject to and qualified in its entirety by our Articles of Incorporation as amended, our Bylaws and by the applicable provisions of the State of Delaware law. Our authorized capital stock consists of 150,000,000 shares of Common Stock having a par value of $0.0001 per share. There is no cumulative voting for the election of directors. There are no preemptive rights to purchase shares. The holders of shares of common stock are entitled to dividends, out of funds legally available therefore, when and as declared by the Board of Directors. The Board of Directors has never declared a dividend and do not anticipate declaring a dividend in the future. Each outstanding share of common stock entitles the holder thereof to one vote per share on all matters presented to the shareholders for a vote. In the event of liquidation, dissolution or winding up of our affairs, holders are entitled to receive, ratably, our net assets available to shareholders after payment of all creditors. All of our issued and outstanding shares of common stock are duly authorized, validly issued, fully paid, and non-assessable. To the extent that our unissued shares of common stock are subsequently issued, the relative interests of existing shareholders will be diluted.
We will not receive any proceeds from the sale of the proceedssecurities by the selling shareholders. We will pay all costs of registering the securities offered by the selling shareholders. These costs, based upon the time related to preparing this section of the prospectus, are estimated to be $2,000. The selling shareholders will pay all sales commissions and other costs of the sale of shares by the Selling Shareholders. We will pay the cost of registering under the Securities Exchange Act of 1933 the sharessecurities offered by this prospectus.them. The warrants are exercisable at a price of $0.20 per share and expire between September 30, 2022 and December 31, 2022.
- 70 -
Shares | Shares Issuable Upon Exercise | Share Shares to be Sold | Percentage Ownership after this | Ownership after this | ||||||||||||||||
Name | Owned | of Warrants | in this Offering(1) | Offering | Offering | |||||||||||||||
Prasil Family Matters, LLC | 39,137,327 | 11,772,400 | 24,818,176 | 14,319,151 | 4 | % | ||||||||||||||
Jon D. & Linda W. Gruber Trust | 36,650,603 | 11,472,535 | 12,216,868 | 24,433,735 | 6.9 | % | ||||||||||||||
I. Wistar Morris | 19,998,386 | 5,000,000 | 8,999,677 | 10,998,709 | 3.1 | % | ||||||||||||||
Martha Morris | 431,079 | - | 143,693 | 287,386 | * | |||||||||||||||
Eleventh Generation | 419,457 | - | 139,819 | 279,638 | * | |||||||||||||||
Cotswold Foundation | 1,336,080 | - | 267,216 | 1,068,864 | * | |||||||||||||||
Mark E. Anderson MD Trust | 10,220,898 | 3,213,677 | 6,620,643 | 3,600,255 | 1 | % | ||||||||||||||
Samuel W. Morris Jr. | 1,895,115 | 587,810 | 1,219,515 | 675,600 | * | |||||||||||||||
Terry Gruber | 776,731 | 500,000 | 842,244 | - | - | |||||||||||||||
Wayne Harding | 268,300 | 268,300 | 357,733 | - | - | |||||||||||||||
Michael Harnish | 396,100 | 396,100 | 528,133 | - | - | |||||||||||||||
Michael Harnish IRA | 1,127,088 | - | 375,696 | 751,392 | * | |||||||||||||||
Michael & Linda Harnish Revocable Trust | 230,850 | - | 76,950 | 153,900 | * | |||||||||||||||
David Marshall | 245,779 | - | 300,486 | - | - | |||||||||||||||
Peter Ammentop | 376,458 | 175,000 | 300,486 | 75,972 | * | |||||||||||||||
Bill Reeb | 188,229 | 87,500 | 281,756 | - | - | |||||||||||||||
John P. Brooks IRA | 352,967 | 164,063 | 281,756 | 71,211 | * | |||||||||||||||
Jeanne Brooks | 188,229 | 87,500 | 50,243 | 137,986 | * | |||||||||||||||
James Lee Wagner | 10,249,375 | 5,124,688 | 15,374,063 | - | - | |||||||||||||||
RM Materials, LLC | 61,510,800 | 20,503,600 | 20,503,600 | 41,007,200 | 11.6 | % | ||||||||||||||
Two Rivers Water & Farming | ||||||||||||||||||||
Company | 4,384,913 | 4,384,913 | 6,577,369 | - | - | |||||||||||||||
Louise Lowe | 3,019,455 | - | 1,006,485 | 2,012,970 | * | |||||||||||||||
George McCaffrey | 9,495,700 | - | 3,165,233 | 6,330,467 | 1.8 | % | ||||||||||||||
Mike McCullough | 855,510 | - | 285,170 | 570,340 | * | |||||||||||||||
Russ Coppock | 1,761,350 | - | 587,117 | 1,174,233 | * | |||||||||||||||
Heather Burshten | 666,667 | - | 222,222 | 444,445 | * | |||||||||||||||
Jan McCaffrey | 500,000 | - | 166,667 | 333,333 | * |
SELLING SHAREHOLDERS AND PLAN OF DISTRIBUTION
* | Less than 1% |
(1) | Represents any combination of shares owned as of the date of this prospectus and shares issuable upon exercise of warrants. |
17 |
The registration statement,controlling persons of which this prospectus formsthe non-individual selling shareholders are:
Name of Shareholder | Controlling Person | |
Prasil Family Matters, LLC | Thomas Prasil | |
Jon D. & Linda W. Gruber Trust | Jon D. and Linda W. Gruber | |
Eleventh Generation | I. Wistar Morris | |
Cotswold Foundation | I. Wistar Morris | |
Michael Harnish Trust | Michael Harnish | |
Mark E. Anderson MD Trust | Mark E. Anderson | |
Michael & Linda Harnish Revocable Trust | Michael and Linda Harnish | |
RM Materials, LLC | Richard Kwesell | |
Two Rivers Water & Farming Company | Greg Harrington |
To our knowledge, no selling shareholder is affiliated with a part, relates to our registration of an aggregate of 32,417,919securities broker.
The shares of common stock offeredmay be sold by the selling shareholders named belowby one or more of the following methods, without limitation:
|
|
|
|
|
|
|
Shareholder/Option Holder/Warrant Holder |
| Total to register |
| Relationship with Issuer |
| Shares owned After Offering* |
|
|
|
|
|
|
|
Gundyco ITF 0760838 B.C. Ltd. |
| 100,000 |
| None |
| 0 |
|
|
|
|
|
|
|
1475468 Ontario Inc. (Robert Kennedy, natural person exercising control) |
| 125,000 |
| None |
| 0 |
|
|
|
|
|
|
|
709178 Alberta Ltd. (Gord Welch, natural person exercising control person) |
| 58,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Raymond James ITF 767269 Ontario Ltd. (Thomas Winiker natural person exercising control) |
| 30,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Roytor & Co. (AGF) |
| 808,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Agoracom Investor Relations Corp. (Scott Purkis, natural person exercising control) |
| 62,500 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
Ahmed Hassan |
| 66,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Aleksandra Bukacheva |
| 26,190 |
| None |
| 0 |
|
|
|
|
|
|
|
NBCN Securities Inc. ITF Altus Securities Inc. A/C 2RE048E |
| 5,625 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Andrew Blackwood |
| 7,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Anton (Tony) Nussbaumer |
| 78,100 |
| None |
| 0 |
|
|
|
|
|
|
|
Arthur Mitton |
| 14,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Arthur Resnick |
| 27,500 |
| None |
| 0 |
ATNA Resources |
| 400,000 |
| None |
| 0 |
Aubra Franklin |
| 150,000 |
| None |
| 0 |
- 71 -
|
|
|
|
|
|
|
GundyCo. ITF Audrey Van Vliet |
| 24,999 |
| None |
| 0 |
|
|
|
|
|
|
|
B.F. Pittman |
| 43,667 |
| None |
| 0 |
|
|
|
|
|
|
|
Bank Sal. Oppenheim Jr. & Cie |
| 150,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Barney R. Jeffcoats |
| 51,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Blake Cassidy |
| 16,500 |
| None |
| 0 |
|
|
|
|
|
|
|
NBCN Clearing Inc. ITF BNAD Construction Inc. (Ivo Battistella, natural person exercising control) |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Bob Kiez |
| 5,280 |
| None |
| 0 |
|
|
|
|
|
|
|
Bora Albulak |
| 12,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Brad Houston |
| 176,501 |
| None |
| 0 |
|
|
|
|
|
|
|
Investor Co. ITF Brendan D. Ryan |
| 12,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Brian Robertson |
| 78,168 |
| Former Officer |
| 0 |
|
|
|
|
|
|
|
Bruce Knox |
| 45,045 |
| None |
| 0 |
|
|
|
|
|
|
|
NBCN Clearing Inc. ITF Bruce McEwen |
| 50,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Bunnaton Ltd. (Angus Forsyth, natural person control) |
| 225,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Cameron Copland |
| 6,820 |
| None |
| 0 |
|
|
|
|
|
|
|
Campbell & Lee Investment Management Inc. (Bruce Campbell, natural person exercising control) |
| 33,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Chasseur Corporation (Victor McCall, natural person exercising control) |
| 272,660 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Clayton Blackwood |
| 12,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Cletus Ryan |
| 200,000 |
| Vice-President, Corporate Development |
| 0 |
● | a block trade in which a broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; | |
● | purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this prospectus; | |
● | ordinary brokerage transactions and transactions in which the broker solicits purchasers; and | |
● | face-to-face transactions between sellers and purchasers without a broker/dealer. |
- 72 -
|
|
|
|
|
|
|
Cynthia Borkowsky |
| 27,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Daniel W. Stickle |
| 11,000 |
| None |
| 0 |
|
|
|
|
|
|
|
David and Kathy Rittmueller |
| 101,716 |
| None |
| 0 |
|
|
|
|
|
|
|
David Balardo |
| 10,477 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF David Burtnik |
| 15,000 |
| None |
| 0 |
|
|
|
|
|
|
|
David Elliott |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
David Shepherd |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
David Whiting |
| 11,000 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Dean Middaugh |
| 24,999 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Dominic Tersigni |
| 24,999 |
| None |
| 0 |
|
|
|
|
|
|
|
Doug Harris |
| 36,740 |
| None |
| 0 |
|
|
|
|
|
|
|
Douglas D. Lottridge |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Duane Engelmeier |
| 17,971 |
| None |
| 0 |
|
|
|
|
|
|
|
Dubuque Inc. |
| 76,525 |
| None |
| 0 |
|
|
|
|
|
|
|
Investor Company (EAM Inc.) (Gregory Galanis, natural person exercising control) |
| 637,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Elgemod Continental SA (Gerold Hoop, natural person exercising control) |
| 150,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Eligio Reina |
| 10,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Endeavor Holdings Inc. |
| 150,000 |
| Former Consultant |
|
|
|
|
|
|
|
|
|
Gundyco ITF Ennio D’Angela |
| 500,000 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
NBCN Securities Inc. ITF Eva Jelec A/C2RE016F |
| 200,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Exploration Capital Partners 2005 Limited Partnership (Arthur Richards Rule, natural person exercising control) |
| 150,000 |
| None |
| 0 |
- 73 -In completing sales, brokers or dealers engaged by the selling shareholders may arrange for other brokers or dealers to participate. Brokers or dealers may receive commissions or discounts from selling shareholders in amounts to be negotiated. As to any particular broker-dealer, this compensation might be in excess of customary commissions.
|
|
|
|
|
|
|
Haywood Securities Inc. ITF FIC Investment Ltd. (Earl Pasquill, natural person exercising control) |
| 135,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF FIC Investments USA Corp. (Earl Pasquill, natural person exercising control) |
| 214,500 |
| None |
| 0 |
|
|
|
|
|
|
|
FYJIGIM, Inc. (Seth Thompson, natural person exercising control) |
| 272,660 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
G. Scott Paterson |
| 62,499 |
| None |
| 0 |
|
|
|
|
|
|
|
G.E. (Ted) Creber, Q.C. |
| 150,000 |
| Director |
| 0 |
|
|
|
|
|
|
|
Gary Bishop |
| 44,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Gary A. Cohoon |
| 200,000 |
| Vice President, Exploration |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Geron Cowherd |
| 12,500 |
| None |
| 0 |
|
|
|
|
|
|
|
GGOF 2007 Mining Flow-Through L.P. (William Belloway, natural person exercising control) |
| 975,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Raymond James ITF Harp Capital Corp. (Jonathan Buick, natural person exercising control) |
| 55,125 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
Harry Roitman |
| 27,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Howard Barth |
| 110,000 |
| Director |
| 0 |
|
|
|
|
|
|
|
Hwa Yeon Lee |
| 45,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Hydeman Family Partners, Ltd. (Robert Hydeman, natural person exercising control) |
| 37,500 |
| None |
| 0 |
- 74 -
|
|
|
|
|
|
|
Ilana Ruby |
| 33,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Iqbal Kassam |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
J. Malcolm Slack |
| 44,725 |
| Former Director |
| 0 |
|
|
|
|
|
|
|
J. Mike Yantis |
| 43,667 |
| None |
| 0 |
|
|
|
|
|
|
|
J.L. Guerra, Jr. |
| 986,364 |
| Chairman of the Board |
| 0 |
|
|
|
|
|
|
|
Jack Campars Ltd. (Jane Campbell, natural person exercising control) |
| 375,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Jaguar Financial Inc. (Vic Albioni, natural person exercising control) |
| 750,000 |
| None |
| 0 |
|
|
|
|
|
|
|
James Barnett |
| 26,190 |
| None |
| 0 |
|
|
|
|
|
|
|
James Smith |
| 28,725 |
| None |
| 0 |
|
|
|
|
|
|
|
Jeremy Link c/o Northern Securities |
| 10,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Joe Dwek |
| 26,190 |
| None |
| 0 |
|
|
|
|
|
|
|
John Edison |
| 90,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Gundyco ITF John Hanemaayer |
| 525,000 |
| None |
| 0 |
|
|
|
|
|
|
|
John Kirby |
| 49,999 |
| None |
| 0 |
|
|
|
|
|
|
|
John Powell |
| 38,500 |
| None |
| 0 |
|
|
|
|
|
|
|
John Rathwell |
| 249,000 |
| None |
| 0 |
|
|
|
|
|
|
|
John Turner |
| 20,900 |
| None |
| 0 |
|
|
|
|
|
|
|
Jonathan Ruby |
| 70,000 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Joseph Carlomusto |
| 125,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Juno Special Situations Corporation (Michael Campbell, natural person exercising control) |
| 1,666,666 |
| None |
| 0 |
18 |
- 75 -
|
|
|
|
|
|
|
Kathy Chapman |
| 75,000 |
| Chief Administrative Officer |
| 0 |
|
|
|
|
|
|
|
Kaylin Marshall |
| 30,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Pension Financial ITF Keith Corbett |
| 40,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Kenneth Deckard |
| 64,120 |
| None |
| 0 |
|
|
|
|
|
|
|
Kenneth Hill |
| 250,000 |
| Director |
| 0 |
|
|
|
|
|
|
|
Kenneth Hope |
| 34,035 |
| None |
| 0 |
|
|
|
|
|
|
|
NBCN Clearing Inc. ITF Kevin McAllister |
| 50,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Kevin Reid |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Kevin Thistle |
| 52,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Kyjormac Inc. (Scott Peterson, natural person exercising control) |
| 273,900 |
| None |
| 0 |
|
|
|
|
|
|
|
Lakeview Fund LP (Michael Nicholas, natural person exercising control) |
| 695,244 |
| None |
| 0 |
|
|
|
|
|
|
|
Lakeview Master Fund Ltd. (Michael Nicholas, natural person exercising control) |
| 304,757 |
| None |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Lamond Investments Ltd. |
| 150,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Lawrence Guichon |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Limited Market Dealer |
| 31,429 |
| None |
| 0 |
|
|
|
|
|
|
|
Lisa Rose |
| 199,000 |
| Corporate Secretary |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Marcus New |
| 120,000 |
| None |
| 0 |
- 76 -
|
|
|
|
|
|
|
Marlene Carol Esbin |
| 27,500 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo ITF Mary Hanemaayer |
| 125,000 |
| None |
| 0 |
|
|
|
|
|
| |
Mavrix A/C 207 (Paul MacDonald, natural person exercising control) |
| 576,922 |
| None |
| 0 |
|
|
|
|
|
|
|
Mavrix A/C 216 (Paul MacDonald, natural person exercising control) |
| 440,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Max Alman |
| 21,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Max Marechaux |
| 15,950 |
| None |
| 0 |
|
|
|
|
|
|
|
Medallion Capital Corp. (Stafford Kelley, natural person exercising control) |
| 141,599 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Michael Lathigee |
| 15,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Investor Company ITF A/C 8J1826E Michael J. Sardo |
| 20,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Raymond James Ltd. ITF Michael Winiker |
| 30,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Michelle McClinton |
| 12,320 |
| None |
| 0 |
|
|
|
|
|
|
|
Millerd Holdings Ltd. |
| 100,000 |
| None |
| 0 |
|
|
|
|
|
|
|
MineralFields 2006 VII Super Flow-Through Limited Partnership (Ron Wortel, natural person exercising control) |
| 361,429 |
| None |
| 0 |
|
|
|
|
|
|
|
MineralFields 2006-IV Super Flow-Through Limited Partnership (Ron Wortel, natural person exercising control) |
| 104,762 |
| None |
| 0 |
|
|
|
|
|
|
|
MineralFields Quebec 2006 Super Flow-Through Limited Partnership (Ron Wortel, natural person exercising control) |
| 5,238 |
| None |
| 0 |
|
|
|
|
|
|
|
Neil Chapman |
| 72,600 |
| None |
| 0 |
- 77 -Neither we nor the selling stockholders can presently estimate the amount of such compensation. Notwithstanding the above, no FINRA member will charge commissions that exceed 8% of the total proceeds from the sale.
|
|
|
|
|
|
|
Northern Precious Metals (Jean Guy Masse, natural person exercising control) |
| 200,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Northern Precious Metals 2006 Limited Partnership (Jean Guy Masse, natural person exercising control) |
| 314,270 |
| None |
| 0 |
|
|
|
|
|
|
|
Northern Securities Inc. (Vic Alboini, natural person exercising control) |
| 12,776 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
Gundyco ITF Novadan Capital Ltd. (Ennio D’Angela, natural person exercising control) |
| 1,519,715 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
NUINSCO Resources Ltd. |
| 24,336 |
| Former Director |
| 0 |
|
|
|
|
|
|
|
Pam Jeffcoat |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Charles H. Jeffcoat |
| 5,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Investor company c/o: Parkwood GP Inc. (Dan Sternberg, natural person exercising control) |
| 637,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Paul Jelec |
| 63,125 |
| None |
| 0 |
|
|
|
|
|
|
|
Paul Millar |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Penson Financial Services Canada Inc. FBO-Northern Securities Inc. (Vic Alboini, natural person exercising control) |
| 237,417 |
| None |
| 0 |
|
|
|
|
|
|
|
Peony Enterprises Limited (Angus Forsyth, natural person exercising control) |
| 30,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Peter Curkovic Ltd. |
| 300,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Peter Meredith |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Pinetree Resource Partnership (Donato Sferrra, natural person exercising control) |
| 1,875,000 |
| None |
| 0 |
- 78 -
|
|
|
|
|
|
|
Polar Securities Inc. (Robin Schulz, natural person exercising control) |
| 983,332 |
| None |
| 0 |
|
|
|
|
|
|
|
Poulos Technology Consulting Inc. (Thomas Poulos, natural person exercising control) |
| 45,000 |
| None |
| 0 |
|
|
|
|
|
|
|
R. Edwin Pitts |
| 37,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Rakesh Malhotra |
| 75,000 |
| Chief Financial Officer |
| 0 |
|
|
|
|
|
|
|
Ray Fulks |
| 20,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Rhone 2006 Flow-Through Limited Partnership |
| 209,440 |
| None |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Richard Bullock |
| 75,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Richard Ewing |
| 91,560 |
| Former Director |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Richard T. Marion |
| 37,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert Carbonaro |
| 25,850 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert E. Cohen |
| 150,700 |
| None |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF Robert G. Atkinson |
| 150,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert Mendel |
| 24,999 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert Q. Houston |
| 51,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert Schellenberg |
| 45,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Robert Van Tassell |
| 100,000 |
| Director |
| 0 |
|
|
|
|
|
|
|
Robert Wagner |
| 30,520 |
| None |
| 0 |
|
|
|
|
|
|
|
Rockport Trading Company (William Silvey, Jr., natural person exercising control) |
| 272,660 |
| Former Consultant |
| 0 |
|
|
|
|
|
|
|
Roger Glasco |
| 412,704 |
| None |
| 0 |
|
|
|
|
|
|
|
Gundyco ITF Romeo D’Angela |
| 350,000 |
| Former Consultant |
| 0 |
- 79 -
|
|
|
|
|
|
|
Ronald K. Mann |
| 500,000 |
| CEO, President & Director |
| 0 |
|
|
|
|
|
|
|
Ronald Phillips |
| 225,000 |
| None |
| 0 |
|
|
|
|
|
|
|
GundyCo. ITF Rosemarie Blackwood |
| 24,999 |
| None |
| 0 |
|
|
|
|
|
|
|
Sammy Kemp |
| 13,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Sheldon Esbin |
| 27,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Stone 2006-11 Flow-through L.P. |
| 314,286 |
| None |
| 0 |
|
|
|
|
|
|
|
Stewart Fumerton |
| 200,000 |
| Former Vice President, Exploration |
| 0 |
|
|
|
|
|
|
|
Susan O’Konski |
| 101,150 |
| None |
| 0 |
|
|
|
|
|
|
|
Terry Evancio |
| 25,000 |
| None |
| 0 |
|
|
|
|
|
|
|
The Barclay Limited Partnership (Richard Fessler, natural person exercising control) |
| 400,000 |
| None |
| 0 |
|
|
|
|
|
|
|
The Barclay Group Limited (Richard Fessler, natural person exercising control) |
| 400,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Thomas L. Schellenberg |
| 81,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Three Eff Corporation |
| 369,215 |
| None |
| 0 |
|
|
|
|
|
|
|
Tony Dyck |
| 150,000 |
| None |
| 0 |
|
|
|
|
|
|
|
NBCN Clearing Inc. ITF Tumer Bahcheli |
| 63,000 |
| None |
| 0 |
|
|
|
|
|
|
|
V. Michael McGuire |
| 15,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Raymond James Ltd. ITF Vanna Schiralli |
| 52,500 |
| None |
| 0 |
|
|
|
|
|
|
|
Vic Alboini |
| 988,206 |
| None |
| 0 |
- 80 -
|
|
|
|
|
|
|
Pension Financial Services Canada Inc. (Vic Alboini, natural person exercising control) |
| 716,509 |
| None |
| 0 |
Vitor Fonsesca |
| 30,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Warren and Julie Cook |
| 68,504 |
| None |
| 0 |
|
|
|
|
|
|
|
Warren Cook |
| 26,973 |
| None |
| 0 |
|
|
|
|
|
|
|
Warren Holmes |
| 149,867 |
| Former Director |
| 0 |
|
|
|
|
|
|
|
Haywood Securities Inc. ITF WBIC Canada Ltd. (Earl Pasquill, natural person exercising control) |
| 60,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Wes Roitman |
| 55,000 |
| None |
| 0 |
|
|
|
|
|
|
|
Whalehaven Capital Fund Limited (Arthur Jones, natural person exercising control) |
| 833,332 |
| None |
| 0 |
|
|
|
|
|
|
|
William Grant |
| 141,000 |
| None |
| 0 |
|
|
|
|
|
|
|
William Watters |
| 10,477 |
| None |
| 0 |
|
|
|
|
|
|
|
Total |
| 32,417,919 |
|
|
|
|
* AssumesThe selling shareholders and any broker/dealers who act in connection with the sale of all of our shares offered in this prospectus. However, we do not know whether the Selling Shareholders will sell all or less than all of their shares.
The sale of the Selling Shareholders’ shares by the Selling Shareholderssecurities may be effected from time to time in transactions, which may include block transactions by or for the account of the Selling Shareholders, in the over-the-counter market or in negotiated transactions, or through the writing of options on the selling shareholders’ shares, a combination of these methods of sale, or otherwise. Sales may be made at market prices prevailing at the time of sale, or at negotiated prices. We are not aware of any underwriting arrangements that have been entered into by the Selling Shareholders. We will file a post-effective amendment to our registration statement with the SEC if any Selling Shareholder enters into an agreement to sell shares through broker-dealers acting as principals after the date of this prospectus.
The Selling Shareholders, during the time each is engaged in distributing shares covered by this prospectus, must comply with the requirements of Regulation M under the Exchange Act. Generally, under those rules and regulations they may not: (i) engage in any stabilization activity in connection with our securities, and (ii) bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Exchange Act.
The Selling Shareholders and broker-dealers, if any, acting in connection with these sales might be deemed to be “underwriters” within the meaning of Section 2(11)§2(11) of the Securities Act. Any commission they receiveActs of 1933, and any commissions received by them and any profit upon theon any resale of the securities as principal might be deemed to be underwriting discounts and commissions under the Securities Act.
- 81 -
Rules 15g-1 through 15g-9 promulgatedIf any selling shareholder enters into an agreement to sell his or her securities to a broker-dealer as principal, and the broker-dealer is acting as an underwriter, we will file a post-effective amendment to the registration statement, of which this prospectus is a part, identifying the broker-dealer, providing required information concerning the plan of distribution, and otherwise revising the disclosures in this prospectus as needed. We will also file the agreement between the selling shareholder and the broker-dealer as an exhibit to the post-effective amendment to the registration statement.
The selling shareholders may also sell their shares pursuant to Rule 144 of the Securities and Exchange Commission.
We have advised the selling shareholders that they, and any securities broker/dealers or others who sell the common stock or warrants on behalf of the selling shareholders, may be deemed to be statutory underwriters and will be subject to the prospectus delivery requirements under the Securities Act of 1933. We have also advised each selling shareholder that in the event of a “distribution” of the securities owned by the selling shareholder, the selling shareholder, any “affiliated purchasers”, and any broker/dealer or other person who participates in the distribution may be subject to Rule 102 of Regulation M under the Securities Exchange Act of 1934 (“1934 Act”) until their participation in that distribution is completed. Rule 102 makes it unlawful for any person who is participating in a distribution to bid for or purchase securities of the same class as amended, impose sales practice and disclosure requirements on NASD broker-dealers who make a marketis the subject of the distribution. A “distribution” is defined in “a penny stock”. A penny stock generally includes any non-NASDAQ equity security that has a market priceRule 102 as an offering of less than $5.00 per share. Our shares may be quoted onsecurities “that is distinguished from ordinary trading transactions by the OTC Bulletin Board ormagnitude of the Toronto Stock Exchange,offering and the pricepresence of our shares may fall within a range which would cause our shares to be considered a “penny stock.” The additional sales practicespecial selling efforts and disclosure requirements imposed upon broker-dealers handling “penny stocks” may discourage broker-dealers from effecting transactions in our shares, which could severely limit the market liquidity of the shares and impede the sale of our shares in the market.
Under the “penny stock” regulations, a broker-dealer selling “penny stocks” to anyone other than an established customer or “accredited investor” (generally, an individual with net worth in excess of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse) must make a special suitability determination for the purchaser and must receive the purchaser’s written consent to the transaction prior to purchase, unless the broker-dealer or the transaction is otherwise exempt.
In addition, the “penny stock” regulations require the broker-dealer to deliver, prior to any transaction involving a “penny stock”, a disclosure schedule prepared by the Commission relating to the “penny stock” market, unless the broker-dealer or the transaction is otherwise exempt. A broker-dealer ismethods”. We have also required to disclose commissions payable to the broker-dealer and the registered representative and current quotations for the securities. Finally, a broker-dealer is required to send monthly statements disclosing recent price information with respect to the “penny stock” held in a customer’s account and information with respect to the limited market in “penny stocks.”
All of the foregoing may affect the marketability of the securities.
Sales of any shares of common stock byadvised the selling shareholders may depressthat Rule 101 of Regulation M under the 1934 Act prohibits any “stabilizing bid” or “stabilizing purchase” for the purpose of pegging, fixing or stabilizing the price of the common stock in connection with this offering.
Common Stock
We are authorized to issue 500,000,000 shares of common stock. Holders of our common stock are each entitled to cast one vote for each share held of record on all matters presented to the shareholders. Cumulative voting is not allowed; hence, the holders of a majority of our outstanding common shares can elect all directors.
Holders of our common stock are entitled to receive such dividends as may be declared by our Board of Directors out of funds legally available and, in the event of liquidation, to share pro rata in any marketdistribution of our assets after payment of liabilities. Our Board of Directors is not obligated to declare a dividend. It is not anticipated that dividends will be paid in the foreseeable future.
Holders of our common stock do not have preemptive rights to subscribe to additional shares if issued. There are no conversions, sinking fund or similar provisions regarding the common stock. All outstanding shares of common stock are fully paid and non-assessable.
We have not paid any dividends and we do not plan on paying any dividends in the foreseeable future.
19 |
Warrants
Each Warrant to be issued by means of this prospectus allows the holder to purchase one share of our common stock at an exercise price of $0.20 per share at any time on or before December 31, 2022.
Other provisions of the Warrants:
1. Unless exercised within the time provided for exercise, the warrants will automatically expire.
2. The exercise price of the warrants may developnot be increased during the term of the warrants, but the exercise price may be decreased at the discretion of the Company’s Board of Directors by giving each warrant holder notice of such decrease. The exercise period for the common stock.warrants may be extended by the Company’s Board of Directors giving notice of such extension to each warrant holder of record.
Under
3. There is no minimum number of shares which must be purchased upon exercise of the Securities Exchange Actwarrants.
4. The exercise price of 1934,the warrants, as amended,well as the shares issuable upon the exercise of the warrants, will be proportionately adjusted in the event of any stock split, stock dividend, reclassification, capital reorganization or merger.
5. The holders of the warrants have no voting power and its regulations, any person engagedare not entitled to dividends. In the event of the liquidation or dissolution of the Company, holders of the warrants will not be entitled to participate in the distribution of sharesthe Company’s assets.
Transfer Agent
Old Monmouth Stock Transfer Co., Inc.
200 Memorial Parkway
Atlantic Highlands, NJ 07716
(732) 872-2727
Hart and Hart, LLC of Denver, Colorado has passed upon the validity of our common stock offered by this prospectus may not simultaneously engage in market-making activities with respect to the common stock during the applicable “cooling off” period prior to the commencement of this distribution. In addition, and without limiting the foregoing, the selling shareholders will be subject to applicable provisions of the Exchange Act and its rules and regulations, including without limitation Regulation M promulgated under the Exchange Act, in connection with transactions in the shares, which provisions may limit the timing of purchases and sales of shares of common stock by the selling shareholders.Prospectus.
The above table sets forth information known to us regarding ownership of our common stock by each of the Selling Shareholders
Our financial statements as of the date hereofDecember 31, 2020 and as adjusted to reflect the sale of shares offered by this prospectus. None of the Selling Shareholders has had any position with, held any office of, or had any other material relationship with us during the past three years except as set forth in the Selling Shareholder’s table above.
We believe, based on information supplied by the Selling Shareholders2019 and our own records that the persons named in the above table have sole voting and investment power with respect to all shares of common stock which they beneficially own.
- 82 -
Blue Sky Restrictions on Resale
The selling shareholders named in this prospectus may offer and sell the Shares covered by this prospectus only in States in the United States where exemptions from registration under State securities laws are available. The Company has obtained an exemption, known as the “manual exemption,” in approximately 38 States where such exemption is available. Generally, the manual exemption is available to issuers that maintain an up-to-date listing that includes certain information about the issuer in a recognized securities manual. The Company has a listing in “Standard & Poor’s Corporation Records,” a recognized securities manual. The States that provide the manual exemption include: Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Guam, Hawaii, Idaho, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, South Dakota, Texas, U.S. Virgin Islands, Utah, Washington, West Virginia, and Wyoming. Each State’s law is different. Some of the States provide a general exemption for issuers’ securities that are listed in a “recognized securities manual” (or similar language) while other States have provisions that name the recognized securities manuals that qualify an issuer for the exemption in that State. Investors and securities professionals are advised to check each State’s securities laws and regulations (known as “Blue Sky” laws) or to check with Yukon Gold to ascertain whether an exemption exists for the Company’s shares in a particular State.
- 83 -
Source of Shares Held by Selling Shareholders
The following table provides information with respect to issuance of the 32,417,919 shares covered by this prospectus.
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Row |
| Title Of Shares |
| Number of |
| Source |
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1. |
| Common Stock, Par Value $0.0001 per Share |
| 5,970,939 |
| Represents shares of common stock issued by the Company on August 16, 2007 and November 16, 2007 as part of its Flow Through Units and Units placed with investors. The share issuance was undertaken pursuant to an exemption from registration under the Securities Act pursuant to Regulation S (“Regulation S”) promulgated under the Securities Act. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person” as that term is defined under Rule 902 of Regulation S, (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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2. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Warrants of the Company |
| 807,692 |
| Represents shares of common stock issuable by the Company upon exercise of Flow-through Warrants. Each Flow-through Warrant has a two-year term that ends on August 16, 2009 or November 16, 2009, as the case may be, and is exercisable at a price of $0.70 (CDN$0.70) per share. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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3. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Unit Warrants of the Company |
| 2,177,775 |
| Represents shares of common stock issuable by the Company upon exercise of Unit Warrants. Each Unit Warrant has a two-year term that ends on August 16, 2009 or November 16, 2009, as the case may be, and is exercisable at a price of $0.60 (CDN$0.60) per share. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 84 -
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4. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Compensation Options |
| 129,230 |
| Represents shares of common stock underlying Flow-through Compensation Options issued to the placement agent for private placements completed on August 16, 2007 and November 16, 2007. Each Flow-through Compensation Option is exercisable for a two-year period at a price of $0.52 (CDN$0.52) per share. In the case of the Flow-through Compensation Options, exercise of the option entitles the placement agent to one share of flow-through common stock and one-half of one common share purchase warrant exercisable at $0.70 (CDN$0.70) per whole share. Issuance of shares on a “flow through” basis entitles certain Canadian taxpayers to make use of certain investment tax credits. The shares listed in this row represent shares that are issuable upon exercise of the Flow-through Compensation Options. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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5. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Unit Compensation Options |
| 348,444 |
| Represents shares of common stock underlying Unit Compensation Options issued to the placement agent for private placements completed on August 16, 2007 and November 16, 2007. Each Unit Compensation Option is exercisable at a price of $0.45 (CDN$0.45) per share. The options are exercisable for a two-year period, beginning on the closing dates of the respective private placements. In the case of the Unit Compensation Options, exercise of the option entitles the placement agent to one share of common stock and one-half of one common share purchase warrant exercisable at $0.60 (CDN$0.60) per whole share. The shares listed in this row represent shares that are issuable upon exercise of the Unit Compensation Options. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 85 -
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6. |
| Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Compensation Warrants |
| 174,221 |
| The placement agent for the private placements completed on August 16, 2007 and November 16, 2007 received Unit Compensation Options exercisable at $0.45 (CDN$0.45) per option and Flow-through Compensation Options exercisable at $0.52 (CDN$0.52) per option. In both cases, the options are exercisable for a two-year period, beginning on the closing dates of the respective private placements. In the case of the Unit Compensation Options, exercise of the option entitles the placement agent to one share of common stock and one half-share purchase warrant execrable at $0.60 (CDN$0.60) per whole share. In the case of the Flow-though Compensation Options, exercise of the option entitles the placement agent to one share of flow-though common stock and one half-share (issued on a flow-though basis) purchase warrant execrable at $0.70 (CDN$0.70) per whole share. The shares listed in these rows represent shares that are issuable upon exercise of the underlying Unit Compensation Warrants and the underlying Flow-through Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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7. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Compensation Warrants |
| 64,614 |
| The placement agent for the private placements completed on August 16, 2007 and November 16, 2007 received Unit Compensation Options exercisable at $0.45 (CDN$0.45) per option and Flow-through Compensation Options exercisable at $0.52 (CDN$0.52) per option. In both cases, the options are exercisable for a two-year period, beginning on the closing dates of the respective private placements. In the case of the Unit Compensation Options, exercise of the option entitles the placement agent to one share of common stock and one half-share purchase warrant execrable at $0.60 (CDN$0.60) per whole share. In the case of the Flow-though Compensation Options, exercise of the option entitles the placement agent to one share of flow-though common stock and one half-share (issued on a flow-though basis) purchase warrant execrable at $0.70 (CDN$0.70) per whole share. The shares listed in these rows represent shares that are issuable upon exercise of the underlying Unit Compensation Warrants and the underlying Flow-through Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 86 -
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8. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Warrants |
| 500,000 |
| Represents shares of common stock underlying warrants of the Company. Each warrant is exercisable at $0.24 (CDN$0.24) per share until December 17, 2012.The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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9. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Stock Options |
| 1,837,500 |
| Represents shares underlying stock options issued pursuant to the 2006 Stock Option Plan. The maximum price shown in the table is the average of the exercise prices for such stock options. The issuances were undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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10. |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Special Warrants of the Company [previously covered by Registration Statement No. 333-140674] |
| 2,823,049 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Flow-through Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 87 -
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11. |
| Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Special Warrants of the Company [previously covered by Registration Statement No. 333-140674] |
| 334,218 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Unit Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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12 |
| Common Stock Par Value $0.0001 per Share, issuable upon exercise of Warrants issuable upon exercise of Unit Special Warrants [previously covered by Registration Statement No. 333-140674] |
| 334,218 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Unit Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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13. |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Flow-through Compensation Warrants [previously covered by Registration Statement No. 333-140674] |
| 197,613 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Flow-through Compensation Warrants issued to two agents for the Company. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 88 -
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14 |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-140674] |
| 56,295 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Unit Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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15 |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Common Share Purchase Warrants issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-140674] |
| 56,295 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-140674, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Unit Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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16 |
| Common Stock, Par Value $0.0001 per Share, issuable upon exercise of Flow-through Special Warrants of the Company [previously covered by Registration Statement No. 333-142276] |
| 282,309 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Flow-through Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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17 |
| Common Stock Par Value $0.0001 per Share, issuable upon exercise of Unit Special Warrants of the Company [previously covered by Registration Statement No. 333-142276] |
| 33,423 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Unit Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 89 -
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18. |
| Common Stock Par Value $0.0001 per Share, issuable upon exercise of Warrants issuable upon exercise of Unit Special Warrants [previously covered by Registration Statement No. 333-142276] |
| 33,423 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock are issuable by the Company upon exercise of Unit Special Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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19. |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Flow-through Compensation Warrants [previously covered by Registration Statement No. 333-142276] |
| 19,763 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Flow-through Compensation Warrants issued to two agents for the Company. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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20. |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-142276] |
| 2,340 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Unit Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 90 -
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21. |
| Common Stock Par Value $0.0001 per Share issuable upon exercise of Common Share Purchase Warrants issuable upon exercise of Unit Compensation Warrants [previously covered by Registration Statement No. 333-142276] |
| 2,340 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-142276, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. These shares of common stock underlie Unit Compensation Warrants. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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22. |
| Common Stock, Par Value $0.0001 per Share [previously covered by Registration Statement No. 333-137039] |
| 9,543,364 |
| These shares were previously covered by our registration statement on Form SB-2, SEC File No 333-137039, and have been included in the registration statement of which this prospectus forms a part in connection with the termination of our prior registration statement. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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23. |
| Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company |
| 245,455 |
| Represents shares of the Company’s common stock issuable upon exercise of Warrants at a price of $1.00 per share, with an expiry date of September 22, 2008. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 91 -
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24. |
| Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company |
| 950,000 |
| Represents shares of the Company’s common stock issuable upon exercise of Warrants with an expiry date of October 4, 2008 and is exercisable at a price of $2.00 per share. Effective as of November 29, 2007, the expiry date of the warrants was extended to October 4, 2009. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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25. |
| Common Stock, Par Value $0.0001 per Share issuable upon exercise of Warrants of the Company |
| 2,665,669 |
| Represents shares of the Company issuable upon exercise of warrants with an expiry date of March 29, 2008, at an exercise price of $0.90. Effective as of November 29, 2007, the expiry date of the warrants was extended to March 29, 2009. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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26. |
| Common Stock, Par Value $0.0001 per Share issuable upon exercise of Broker Warrants of the Company |
| 533,133 |
| Represents shares of the Company issuable upon exercise of broker warrants with an expiry date of March 29, 2008, at an exercise price of $0.60. Effective as of November 29, 2007, the expiry date of the warrants was extended to March 29, 2009. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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27. |
| Common Stock, Par Value $0.0001 per Share issuable upon exercise of warrants underlying Broker Warrants of the Company |
| 266,567 |
| Represents shares of the Company issuable upon exercise of warrants underlying broker warrants with an expiry date of March 29, 2008, at an exercise price of $0.90. Effective as of November 29, 2007, the expiry date of the warrants was extended to March 29, 2009. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
- 92 -
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28. |
| Common Stock, Par Value $0.0001 per Share |
| 400,000 |
| Represents shares of the Company issued for three property payments on the Marg Property on March 1, 2005, December 6, 2005 and December 6, 2006. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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29. |
| Common Stock, Par Value $0.0001 per Share |
| 369,215 |
| Represents shares of the Company issued on August 5, 2005 in settlement of a demand promissory note. The issuance was undertaken pursuant to an exemption from registration under Regulation S. The issuance was undertaken pursuant to an exemption from registration under Regulation S. T Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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30. |
| Common Stock, Par Value $0.0001 per Share |
| 36,504 |
| Represents shares of the Company issued on August 23, 2005 to an outside company and to a former officer for professional services settlement. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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31. |
| Common Stock, Par Value $0.0001 per Share |
| 150,000 |
| Represents shares of the Company issued on August 25, 2005 to an outside company for professional services settlement. The issuance was under taken pursuant to exemptions from registration under Section 4(2) of the Securities Act and Rule 506 of Regulation D (“Regulation D”) promulgated under the Securities Act. The subscriber represented to the Company that it was an “accredited investor” as that term is defined under Rule 501 of Regulation and the shares were issued with a restrictive legend. |
- 93 -
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32. |
| Common Stock, Par Value $0.0001 per Share |
| 490,909 |
| Represents shares of the Company issued on August 26, 2005 in a private placement. The issuance was undertaken pursuant to exemptions from registration under Section 4(2) of the Securities Act and Rule 506 of Regulation D. The subscriber represented to the Company that it was an “accredited investor” as that term is defined under Rule 501 of Regulation and the shares were issued with a restrictive legend. |
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33. |
| Common Stock, Par Value $0.0001 per Share |
| 149,867 |
| Represents shares of the Company issued on August 29, 2005 in a private placement. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber (i) represented to the Company that he/she/it was not a “U.S. Person,” (ii) covenanted to the Company that he/she/it would adhere to the resale restrictions of Regulation S, and (iii) accepted share certificates bearing a restrictive legend. |
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34. |
| Common Stock, Par Value $0.0001 per Share |
| 150,000 |
| Represents shares of the Company issued on December 5, 2005 in a private placement. The issuance was undertaken pursuant to exemptions from registration under Section 4(2) of the Securities Act and Rule 506 of Regulation D. The subscriber represented to the Company that it was an “accredited investor” as that term is defined under Rule 501 of Regulation and the shares were issued with a restrictive legend. |
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35. |
| Common Stock, Par Value $0.0001 per Share |
| 10,000 |
| Represents shares of the Company issued on April 11, 2006 to a director upon exercising stock options granted under the 2003 Stock Option Plan. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber in the issuance represented to the Company that he/she/it was not a “U.S. Person” as that term is defined under Rule 902 of Regulation S, covenanted to the Company that it would adhere to the resale restrictions of Regulation S, and the shares were issued with a restrictive legend. |
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36. |
| Common Stock, Par Value $0.0001 per Share |
| 61,171 |
| Represents shares of the Company issued on July 17, 2006 to an accredited investor upon exercise of warrants. The issuance was undertaken pursuant to exemptions from registration under Section 4(2) of the Securities Act and Rule 506 of Regulation D. The subscriber in the issuance represented to the Company that it was an “Accredited Investor” as that term is defined under Rule 501 of Regulation and the shares were issued with a restrictive legend. |
- 94 -
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37. |
| Common Stock, Par Value $0.0001 per Share |
| 24,000 |
| Represents shares of the Company issued on September 7, 2006 to an officer upon exercising stock options granted under the 2003 Stock Option Plan. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber in the issuance represented to the Company that he/she/it was not a “U.S. Person” as that term is defined under Rule 902 of Regulation S, covenanted to the Company that it would adhere to the resale restrictions of Regulation S, and the shares were issued with a restrictive legend. |
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38. |
| Common Stock, Par Value $0.0001 per Share |
| 50,000 |
| Represents shares of the Company issued on December 12, 2006 to a former officer upon exercising stock options granted under the 2003 Stock Option Plan. The issuance was undertaken pursuant to an exemption from registration under Regulation S. Each subscriber in the issuance represented to the Company that he/she/it was not a “U.S. Person” as that term is defined under Rule 902 of Regulation S, covenanted to the Company that it would adhere to the resale restrictions of Regulation S, and the shares were issued with a restrictive legend. |
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39. |
| Common Stock, Par Value $0.0001 per Share |
| 136,364 |
| Represents shares of the Company issued on July 7, 2007 in settlement of a property payment on the Mount Hinton property. The issuance was undertaken pursuant to an exemption from registration under Regulation S. The subscriber in the issuance represented to the Company that it was not a “U.S. Person” as that term is defined under Rule 902 of Regulation S, covenanted to the Company that it would adhere to the resale restrictions of Regulation S, and the shares were issued with a restrictive legend. |
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| Total |
| 32,417,919 |
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- 95 -
Expenses of the Offering
Yukon Gold will pay the entire expenses of the offering which are estimated to be $19,179.
We intend to keep this prospectus effective until all of the Warrants of the Company, Flow-Through Unit Warrants of the Company, Unit Warrants of the Company, Flow-Through Compensation Warrants of the Company and Unit Compensation Warrants of the Companyperiods then ended have been exercised or the resale of the shares covered by this prospectus by the Selling Shareholders is covered by an exemption from registration under the Securities Act of 1933.
We are not a party to any pending legal proceeding or litigation and none of our property is the subject of a pending legal proceeding.
The validity of the issuance of the common stock offered in this prospectus has been passed upon by Kavinoky Cook LLP, Buffalo, New York.
The consolidated financial statements of Yukon Gold Corporation, Inc. for the years ended April 30, 2008, April 30, 2007 and April 30, 2006 were audited by Schwartz Levitsky Feldman LLP,BF Borgers CPA PC, our independent auditors,registered public accounting firm, as set forth in their report thereon appearing inwhich is part of this prospectus, and are includedProspectus. Such financial statements have been incorporated herein in reliance uponon the report of such reportfirm given upon thetheir authority of such firm as experts in accounting and auditing. Reports regarding the mineral properties at the Mount Hinton site have been prepared for us by Junior Mine Services, Inc. and by Archer, Cathro & Associates (1981) Limited and much
The Company’s Bylaws authorize indemnification of a director, officer, employee or agent of the information about the Mount Hinton Property contained in this prospectus has been obtained from those reports with their consent. Reports regarding the mineral properties at the Marg Property site were preparedCompany against expenses incurred by Peter Holbek, M.Sc., P.Geo. of Viking GeoScience and much of the information about the Marg Property contained in this prospectus has been obtained from those reports with their consent.
As of November 20, 2003, the board of Yukon Gold unanimously approved the replacement of Rotenberg & Co., LLP with Schwartz Levitsky Feldman LLP. Yukon Gold’s principal independent auditors are Schwartz Levitsky Feldman LLP.
Prior to the consummation of the Share Purchase Agreement, when our company was known as “TAKE-4, Inc.”, Rotenberg & Co., LLP acted as our independent auditors. Following the consummation of the Share Purchase Agreement with YGC, Yukon Gold chose to replace Rotenberg & Co., LLP with Schwartz Levitsky Feldman LLP because Schwartz Levitsky Feldman LLP had experience with respect to the Canadian mining industry, the requirements of U.S. GAAP relating to the mining industry and in addition, Schwartz Levitsky Feldman LLP had audited the financial statements of our subsidiary, YGC.
Yukon Gold neither had nor has any disagreements with Rotenberg & Co. LLP on any matter of accounting principles or practice, financial statement disclosure, or auditing scope or procedures till the date of this prospectus, which disagreements if not resolved to their satisfaction would have caused them to make referencehim in connection with their opinion of the subject matter of the disagreement.
- 96 -
The audit reports of Rotenberg & Co., LLP for all years and periods of audit, did not contain any adverse opinion nor were they qualifiedaction, suit, or modified asproceeding to uncertainty, audit scope, or accounting principles except for a “going concern” qualification.
During Yukon Gold’s two most recent fiscal years ended April 30, 2008 and April 30, 2007, Yukon Gold has not consulted with Schwartz Levitsky Feldman LLP regarding any of the matters specified in Item 304(a)(2) of Reg. S-K.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
The Delaware Business Corporation Act and our by-laws, provide that we shall indemnify our officers and directors and hold harmless each person who was,which he is or is threatened to be madenamed a party to or is otherwise involved in any threatened proceedings by reason of his having acted or served in such capacity, except for liabilities arising from his own misconduct or negligence in performance of his duty. In addition, even a director, officer, employee, or agent of the fact that heCompany’ who was found liable for misconduct or shenegligence in the performance of his duty may obtain such indemnification if, in view of all the circumstances in the case, a court of competent jurisdiction determines such person is or was our director or officer, against losses, claims, damages, liabilities and expenses actuallyfairly and reasonably incurred or suffered in connection with such proceeding. However, the statutory indemnity does not apply to: (a) acts or omissions of the director finally adjudgedentitled to be intentional misconduct or a knowing violation of law; (b) unlawful distributions; or (c) any transaction with respect to which it was finally adjudged that such director personally received a benefit in money, property, or services to which the director was not legally entitled.indemnification. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers, andor persons controlling personsthe Company pursuant to the forgoingforegoing provisions, or otherwise, we havethe Company has been advisedinformed that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in thatthe Act and is therefore unenforceable.
20 |
HOW TO GETWHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange CommissionSEC a registration statementRegistration Statement on Form S-1 (together with all amendments and exhibits) under the Securities Act, as amended, with respect to the securities offered by this prospectus. This prospectus which forms a part of the registration statement, does not contain all of the information set forth in the registration statement, as permitted byRegistration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Securities and Exchange Commission. For further information, with respect to us and the securities offered by this prospectus, reference is made to the registration statement. The material terms of all exhibits have been expressed in this prospectus. Statements contained in this prospectus as to the contents of any contract or other document that we have filed as an exhibit to the registration statement are qualified in their entirety by reference to the exhibits for a complete statement of their terms and conditions. The registration statement and other informationRegistration Statement which may be read and copied at the Commission’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Room.
The public may obtain information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Commission maintains a web sitePublic Reference Room is located at http://100 F. Street, N.E., Washington, D.C. 20549.
Our Registration Statement is also available at www.sec.gov, that contains reports, proxythe website of the Securities and information statements, and other information regarding issuers that file electronically with the Commission and you can reach us at info@yukongoldcorp.com. Cletus Ryan acts as the Information Officer for the Company and can be reached at 416-865-9790, extension 12 or cryan@yukongoldcorp.com.Exchange Commission.
- 97 -
21 |
In this registration statement, we use certain capitalized and abbreviated terms, as well as technical terms, which are defined below.
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- 98 -
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- 99 -
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- 100 -
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- 101 -
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- 102 -
LIST OF MOUNT HINTON CLAIMSFinancial Statements
Mount Hinton Property Claimsheld byYukon Gold CorpFor the Years Ended December 31, 2020 and 2019
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- 103 -
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- 104 -
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- 106 -
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- 107 -
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- 108 -
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- 109 -
YUKON GOLD CORPORATION, INC.(AN EXPLORATION STAGE MINING COMPANY)CONSOLIDATED FINANCIAL STATEMENTSYEARS ENDED APRIL 30, 2008 AND APRIL 30, 2007Together With Report of Independent Registered Public Accounting Firm(Amounts expressed in US Dollars)
TABLE OF CONTENTS
- 110 -
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Boardshareholders and the board of Directors and Stockholdersdirectors ofYukon Gold Corporation, Inc.(An Exploration Stage Mining Company) VETANOVA INC
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Yukon Gold Corporation, Inc.VETANOVA INC as at April 30, 2008of December 31, 2020 and 20072019, the related statements of operations, stockholders’ equity (deficit), and cash flows for the years then ended, and the related consolidatednotes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows and stockholders' equity for the years then ended, April 30, 2008 and 2007 andin conformity with accounting principles generally accepted in the United States.
Basis for the period from incorporation to April 30, 2008. Opinion
These consolidated financial statements are the responsibility of the Company'sCompany’s management. Our responsibility is to express an opinion on these consolidatedthe Company’s financial statements based on our audits.audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our auditsaudit in accordance with the standards of the Public Company Accounting Oversight Board (United States).PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referredmisstatement, whether due to above present fairly, in all material respects, the financial position of Yukon Gold Corporation, Inc. as at April 30, 2008 and 2007 and the results of its operations and its cash flows for the years ended April 30, 2008 and 2007 and for the period from incorporation to April 30, 2008 in conformity with United States generally accepted accounting principles.
error or fraud. The companyCompany is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included considerationAs part of our audits we are required to obtain an understanding of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company'sCompany’s internal controlscontrol over financial reporting. Accordingly, we express no such opinion.
The accompanying consolidated
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, have been prepared assumingwhether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company is an exploration stage mining companyamounts and has no established source of revenues. These conditions raise substantial doubt about its ability to continue as a going concern. Management's plan regarding these matters are also describeddisclosures in the notes to the consolidated financial statements. The consolidatedOur audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements do not include any adjustmentsstatements. We believe that might result from the outcome of this uncertainty.our audit provides a reasonable basis for our opinion.
BF Borgers CPA PC | |
March 25, 2021 |
|
F-1
YUKON GOLD CORPORATION, INC.VETANOVA INC(An Exploration Stage Mining Company)Consolidated
FINANCIAL STATEMENTS
Condensed Balance SheetsAs at April 30, 2008 for the Twelve Months ending December 31, 2020 and April 30, 2007(Amounts expressed in US Dollars)December 31, 2019
April 30, 2008 | April 30, 2007 | |||||
$ | $ | |||||
ASSETS | ||||||
CURRENT ASSETS | ||||||
Cash and cash equivalents | 1,255,620 | 936,436 | ||||
Prepaid expenses and other (note 6) | 282,347 | 464,371 | ||||
Exploration tax credit receivable (note 7) | - | 483,258 | ||||
Short-term investment in available-for-sale securities (note 14) | 31,500 | - | ||||
Restricted Deposit | - | 17,889 | ||||
1,569,467 | 1,901,954 | |||||
RESTRICTED CASH (Note 13) | 817,092 | 2,266,602 | ||||
PROPERTY, PLANT AND EQUIPMENT (Note 8) | 140,041 | 56,551 | ||||
2,526,600 | 4,225,107 |
As of December 31, | ||||||||
2020 | 2019 | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash | $ | - | $ | - | ||||
Receivables - net | - | - | ||||||
Prepaid expenses | 13,734 | 734 | ||||||
Due from related party | 51,179 | - | ||||||
Other current assets | - | - | ||||||
Total Current Assets | 64,913 | 734 | ||||||
Long Term Assets | ||||||||
Property, equipment and software, net | - | - | ||||||
Other long term assets | - | - | ||||||
Total Long Term Assets | - | - | ||||||
TOTAL ASSETS | $ | 64,913 | $ | 734 | ||||
LIABILITIES & STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | - | $ | 10,729 | ||||
Accrued liabilities | 11,925 | - | ||||||
Current portion of notes payable | - | - | ||||||
Related party - VitaNova Partners LLC | - | 6,514 | ||||||
Other current liabilities | - | - | ||||||
Total Current Liabilities | 11,925 | 17,243 | ||||||
Notes Payable, net of current portion | - | - | ||||||
TOTAL LIABILITIES | 11,925 | 17,243 | ||||||
Commitments & Contingencies (Notes 5, 6) | ||||||||
Stockholders’ Equity | ||||||||
Common stock, $0.0001 par value, 500,000,000 shares authorized, 194,971,866 and 626,989 shares issued and outstanding on December 31, 2020 and December 31, 2019, respectfully | 68,694 | 49,260 | ||||||
Additional paid-in capital | 298,322 | (49,260 | ) | |||||
Accumulated (deficit) | (314,028 | ) | (16,509 | ) | ||||
TOTAL STOCKHOLDERS’ EQUITY | 52,988 | (16,509 | ) | |||||
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY | $ | 64,913 | $ | 734 |
The accompanying notes to condensed financial statements are an integral part of these consolidated financial statements.
APPROVED ON BEHALF OF THE BOARDVETANOVA INC
/s/ Ronald K. Mann Ronald K. Mann, DirectorFINANCIAL STATEMENTS
/s/ J. L. Guerra, Jr. J. L. Guerra, Jr., DirectorCondensed Statement of Operations for the Twelve Months ending December 31, 2020 and December 31, 2019
F-2
Twelve Months Ended | ||||||||
December 31, | ||||||||
2020 | 2019 | |||||||
Revenue | $ | 13,125 | $ | - | ||||
Direct cost of revenue | (13,125 | ) | - | |||||
Gross Margin | - | - | ||||||
Operating Expenses | ||||||||
General and administrative | 297,519 | 4,515 | ||||||
Depreciation and amortization | - | - | ||||||
Total Operating Expenses | 297,519 | 4,515 | ||||||
Profit (Loss) from Operations | (297,519 | ) | (4,515 | ) | ||||
Other Income (Expense) | ||||||||
Other | - | - | ||||||
Total Other Income (Expense) | (297,519 | ) | - | |||||
Net Profit (Loss) Before Taxes | (297,519 | ) | (4,515 | ) | ||||
Income Tax (Provision) Benefit | - | - | ||||||
Net Profit (Loss) | $ | (297,519 | ) | $ | (4,515 | ) | ||
(Loss) per Common Share - Basic | $ | (0.01 | ) | $ | (0.01 | ) | ||
(Loss) per Common Share - Dilutive | $ | (0.01 | ) | $ | (0.01 | ) | ||
Weighted Average Shares Outstanding: | ||||||||
Basic | 19,919,780 | 626,989 | ||||||
Dilutive | 19,919,780 | 626,989 |
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Consolidated Balance SheetsAs at April 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
April 30, | April 30, | |||||
2008 | 2007 | |||||
$ | $ | |||||
LIABILITIES | ||||||
CURRENT LIABILITIES | ||||||
Accounts payable and accrued liabilities (Note 9) | 221,222 | 260,134 | ||||
Obligation under Capital Leases | 3,100 | 2,812 | ||||
Total Current Liabilities | 224,322 | 262,946 | ||||
Long -Term Portion of: | ||||||
Obligations under Capital Lease (note 17) | 7,209 | 9,137 | ||||
TOTAL LIABILITIES | 231,531 | 272,083 | ||||
GOING CONCERN (NOTE 2) | ||||||
COMMITMENTS AND CONTINGENCIES (Note 16) | ||||||
RELATED PARTY TRANSACTIONS (NOTE 18) | ||||||
SHAREHOLDERS’ EQUITY | ||||||
CAPITAL STOCK (Note 10) | 2,899 | 2,288 | ||||
ADDITIONAL PAID-IN CAPITAL | 13,984,853 | 10,949,726 | ||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 196,474 | (63,608 | ) | |||
DEFICIT, ACCUMULATED DURING THE EXPLORATION STAGE | (11,889,157 | ) | (6,935,382 | ) | ||
2,295,069 | 3,953,024 | |||||
2,526,600 | 4,225,107 |
The accompanying notes to condensed financial statements are an integral part of these consolidated financial statements.
F-3VETANOVA INC
YUKON GOLD CORPORATION, INC.
FINANCIAL STATEMENTS(An Exploration Stage Mining Company)Consolidated Statements
Condensed Statement of OperationsForCash Flows for the years ended April 30, 2008Twelve Months ending December 31, 2020 and April 30, 2007(Amounts expressed in US Dollars)December 31, 2019
For the year | For the year | ||||||||
Cumulative | ended | ended | |||||||
since | April 30, | April 30, | |||||||
inception | 2008 | 2007 | |||||||
$ | $ | $ | |||||||
OPERATING EXPENSES | |||||||||
General and administration (Note 12) | 5,807,842 | 1,702,640 | 2,483,278 | ||||||
Project expenses | 7,150,486 | 3,341,682 | 1,899,340 | ||||||
Exploration Tax Credit | (605,716 | ) | - | (321,013 | ) | ||||
Amortization | 39,811 | 21,877 | 12,731 | ||||||
Loss on sale/disposal of capital assets | 5,904 | - | - | ||||||
TOTAL OPERATING EXPENSES | 12,398,327 | 5,066,199 | 4,074,336 | ||||||
LOSS BEFORE INCOME TAXES | (12,398,327 | ) | (5,066,199 | ) | (4,074,336 | ) | |||
Income taxes recovery | 509,170 | 112,424 | 370,746 | ||||||
NET LOSS | (11,889,157 | ) | (4,953,775 | ) | (3,703,590 | ) | |||
Loss per share - basic and diluted | (0.19 | ) | (0.20 | ) | |||||
Weighted average common shares outstanding | 26,337,414 | 18,152,531 |
Twelve Months Ended | ||||||||
December 31, | ||||||||
2020 | 2019 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net Loss | $ | (297,519 | ) | $ | (4,515 | ) | ||
Adjustments to reconcile net (loss) to net cash used in operating activities: | ||||||||
Depreciation & amortization | - | - | ||||||
Stock issued for services | 15,924 | - | ||||||
Net change in operating assets and liabilities: | ||||||||
(Increase) in prepaid expenses | (13,000 | ) | - | |||||
Increase in related party payable | (45,798 | ) | 2,515 | |||||
(Decrease) Increase in accounts payable | (10,728 | ) | 2,000 | |||||
Net Cash Used in Operating Activities | (351,091 | ) | - | |||||
Cash Flows from Investing Activities | - | - | ||||||
Cash Flows from Financing Activities | ||||||||
Sale of units | 351,091 | - | ||||||
Cash Flows from Financing Activities | 351,091 | - | ||||||
Net Change in Cash & Cash Equivalents | - | - | ||||||
Beginning Cash & Cash Equivalents | - | - | ||||||
Ending Cash & Cash Equivalents | $ | - | $ | - |
The accompanying notes to condensed financial statements are an integral part of these consolidated financial statements.
F-4
F-4 |
YUKON GOLD CORPORATION, INC.
VETANOVA INC(An Exploration Stage Mining Company)Consolidated Statements
FINANCIAL STATEMENTS
Condensed Statement of Cash FlowsForChanges in Shareholders’ Equity
for the years ended April 30, 2008Twelve Months ending December 31, 2020 and April 30, 2007(Amounts expressed in US Dollars)December 31, 2019
Cumulative | For the Year | For the Year | |||||||
Since | ended | ended | |||||||
Inception | April 30, 2008 | April 30, 2007 | |||||||
$ | $ | $ | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||
Net loss for the year | (11,889,157 | ) | (4,953,775 | ) | (3,703,590 | ) | |||
Items not requiring an outlay of cash: | |||||||||
Amortization | 39,811 | 21,877 | 12,731 | ||||||
Loss on sale/disposal of capital assets | 5,904 | - | - | ||||||
Registration rights penalty expense | 188,125 | - | 188,125 | ||||||
Shares issued for property payment | 525,339 | 57,252 | 153,845 | ||||||
Common shares issued for settlement of severance liability to ex-officer | 113,130 | - | 113,130 | ||||||
Stock-based compensation | 1,260,847 | 584,328 | 451,273 | ||||||
Compensation expense on issue of warrants | 123,079 | 123,079 | - | ||||||
Issue of shares for professional services | 852,523 | - | 722,023 | ||||||
Issue of units against settlement of debts | 20,077 | ||||||||
Decrease (Increase) in prepaid expenses and other | (281,190 | ) | 225,047 | (386,394 | |||||
Decrease (Increase) in exploration tax credit receivable | - | 483,258 | (330,113 | ) | |||||
Increase (Decrease) in accounts payable and accrued liabilities | 220,732 | (47,438 | ) | 27,852 | |||||
(Increase) Decrease in restricted cash | (817,092 | ) | 1,449,510 | (2,148,327 | ) | ||||
Decrease in restricted deposit | - | 17,889 | - | ||||||
Increase (Decrease) in other liabilities | - | (3,750 | |||||||
NET CASH USED IN OPERATING ACTIVITIES | (9,637,872 | ) | (2,038,973 | ) | (4,903,195 | ) | |||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||
Purchase of property, plant and equipment | (183,331 | ) | (102,593 | ) | (6,141 | ) | |||
Investment in available for sale securities | (31,500 | ) | (31,500 | ) | - | ||||
NET CASH USED IN INVESTING ACTIVITIES | (214,831 | ) | (134,093 | ) | (6,141 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||
Repayments from a shareholder | 1,180 | ||||||||
Proceeds (Repayments) from Demand promissory notes | 200,000 | ||||||||
Proceeds from Convertible promissory notes converted | 200,500 | ||||||||
Proceeds from the exercise of stock options | 61,000 | 55,500 | |||||||
Proceeds from exercise of warrants – net | 450,309 | 429,537 | |||||||
Proceeds from subscription of warrants – net | 525,680 | ||||||||
Proceeds from issuance of units/shares – net | 9,460,081 | 2,271,080 | 3,009,762 | ||||||
Proceeds (Repayments) from capital lease obligation | 10,309 | (1,640 | ) | (2,707 | |||||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 10,909,059 | 2,269,440 | 3,492,092 | ||||||
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES | 199,264 | 222,810 | (58,446 | ) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS FOR THE YEAR | 1,255,620 | 319,184 | (1,475,690 | ) | |||||
Cash and cash equivalents, beginning of year | - | 936,436 | 2,412,126 | ||||||
CASH AND CASH EQUIVALENTS, END OF YEAR | 1,255,620 | 1,255,620 | 936,436 | ||||||
INCOME TAXES PAID | - | - | |||||||
INTEREST PAID | - | - |
Common Stock | Additional | |||||||||||||||||||
Shares (000s) | Amount | Paid In Capital | Accumulated (Deficit) | Stockholders’ Equity | ||||||||||||||||
Balances, December 31, 2018 | 627 | $ | 49,260 | $ | (49,260 | ) | $ | (11,994 | ) | $ | (11,994 | ) | ||||||||
2019 Activity: | ||||||||||||||||||||
Net (Loss) | - | $ | - | - | (4,515 | ) | $ | (4,515 | ) | |||||||||||
Balances, December 31, 2019 | 627 | $ | 49,260 | $ | (49,260 | ) | $ | (16,509 | ) | $ | (16,509 | ) | ||||||||
2020 Activity: | ||||||||||||||||||||
Net (Loss) | - | $ | - | - | $ | (297,519 | ) | $ | (297,519 | ) | ||||||||||
Private placement | 35,109 | $ | 3,511 | $ | 347,582 | - | $ | 351,093 | ||||||||||||
Stock issued for services | 103,623 | $ | 10,362 | - | - | $ | 10,362 | |||||||||||||
Stock issued to VitaNova Partners LLC | 55,613 | $ | 5,561 | - | - | $ | 5,561 | |||||||||||||
Balances, December 31, 2020 | 194,972 | $ | 68,694 | $ | 298,322 | $ | (314,028 | ) | $ | 52,988 |
The accompanying notes to condensed financial statements are an integral part of these consolidated financial statements.
F-5VETANOVA INC
YUKON GOLD CORPORATION, INC.(AnExploration StageMiningCompany)ConsolidatedStatements ofChanges inStockholders’ EquityFromInception to April 30, 2008(Amountsexpressed in USDollars)Stockholders’ Equity
| Deficit, | |||||||||||||||||||
| Accumulated | Accumulated | ||||||||||||||||||
| Number of | Common | Additional | during the | Other | |||||||||||||||
| Common | Shares | Paid-in | Subscription | Exploration | Comprehensive | Comprehensive | |||||||||||||
| Shares | Amount | Capital | for Warrants | Stage | Income (loss) | Income (loss) | |||||||||||||
| # | $ | $ | $ | $ | $ | $ | |||||||||||||
Issuance of Common shares | 2,833,377 | 154,063 | - | - | - | - | - | |||||||||||||
Issuance of warrants | - | - | 1,142 | - | - | - | - | |||||||||||||
Foreign currency translation | - | - | - | - | 604 | 604 | ||||||||||||||
Net loss for the year | - | - | - | (124,783 | ) | (124,783 | ) | - | ||||||||||||
| ||||||||||||||||||||
Balance as of April 30, 2003 | 2,833,377 | 154,063 | 1,142 | - | (124,783 | ) | (124,179 | ) | 604 | |||||||||||
| ||||||||||||||||||||
Issuance of Common shares | 1,435,410 | 256,657 | - | - | - | - | ||||||||||||||
Issuance of warrants | - | - | 2,855 | - | - | - | ||||||||||||||
Shares repurchased | (240,855 | ) | (5,778 | ) | - | - | - | - | ||||||||||||
Recapitalization pursuant to reverse acquisition | 2,737,576 | (404,265 | ) | 404,265 | - | - | - | |||||||||||||
Issuance of Common shares | 1,750,000 | 175 | 174,825 | - | - | - | ||||||||||||||
Issuance of Common shares for Property Payment | 300,000 | 30 | 114,212 | - | - | - | ||||||||||||||
Foreign currency translation | - | - | - | - | - | (12,796 | ) | (12,796 | ) | |||||||||||
Net loss for the year | - | - | - | - | (442,906 | ) | (442,906 | ) | - | |||||||||||
| ||||||||||||||||||||
Balance as of April 30, 2004 | 8,815,508 | 882 | 697,299 | - | (567,689 | ) | (455,702 | ) | (12,192 | ) | ||||||||||
| ||||||||||||||||||||
Issuance of Common shares for Property Payment | 133,333 | 13 | 99,987 | - | - | - | - | |||||||||||||
Issuance of common shares on Conversion of Convertible | 76,204 | 8 | 57,144 | - | - | - | - |
F-6(Unaudited)
Promissory note | ||||||||||||||||||||
Foreign currency translation | - | - | - | - | - | 9,717 | 9,717 | |||||||||||||
Net loss for the year | - | - | - | - | (808,146 | ) | (808,146 | ) | - | |||||||||||
| ||||||||||||||||||||
Balance as of April 30, 2005 | 9,025,045 | 903 | 854,430 | - | (1,375,835 | ) | (798,429 | ) | (2,475 | ) | ||||||||||
| ||||||||||||||||||||
Stock based compensation - Directors and officers | 216,416 | |||||||||||||||||||
Stock based compensation - Consultants | 8,830 | |||||||||||||||||||
Issue of common shares and Warrants on retirement of Demand Promissory note | 369,215 | 37 | 203,031 | |||||||||||||||||
Units issued to an outside company for professional services settlement | 24,336 | 2 | 13,384 | |||||||||||||||||
Units issued to an officer for professional services settlement | 12,168 | 1 | 6,690 | |||||||||||||||||
Issuance of common shares for professional services | 150,000 | 15 | 130,485 | |||||||||||||||||
Units issued to shareholder | 490,909 | 49 | 269,951 | |||||||||||||||||
Units issued to a director | 149,867 | 15 | 82,412 | |||||||||||||||||
Units issued to outside subscribers | 200,000 | 20 | 109,980 | |||||||||||||||||
Issuance of common shares on Conversion of Convertible Promissory notes | 59,547 | 6 | 44,654 | |||||||||||||||||
Issuance of common shares on Exercise of warrants | 14,000 | 2 | 11,998 | |||||||||||||||||
Issuance of common shares on Conversion of Convertible | ||||||||||||||||||||
Promissory notes | 76,525 | 8 | 57,386 | |||||||||||||||||
Private placement of shares | 150,000 | 15 | 151,485 | |||||||||||||||||
Issuance of Common shares for property payment | 133,333 | 13 | 99,987 | |||||||||||||||||
Issuance of common shares on Conversion of Convertible Promissory notes | 34,306 | 4 | 25,905 | |||||||||||||||||
Issuance of common shares on Exercise of warrants | 10,000 | 1 | 8,771 | |||||||||||||||||
Issuance of common shares on Conversion of Convertible | 101,150 | 10 | 76,523 |
F-7
Promissory notes | ||||||||||||||||||||
Issue of 400,000 Special Warrants net | 371,680 | |||||||||||||||||||
Issue of 200,000 flow through warrants | 154,000 | |||||||||||||||||||
Brokered private placement of shares- net | 5,331,327 | 533 | 2,910,375 | |||||||||||||||||
Brokered Private placement of flow through Shares- net | 25,000 | 2 | 13,310 | |||||||||||||||||
Exercise of stock options | 10,000 | 1 | 5,499 | |||||||||||||||||
Foreign currency translation | - | - | - | (2,687 | ) | (2,687 | ) | |||||||||||||
Net loss for the year | - | - | - | (1,855,957 | ) | (1,855,957 | ) | - | ||||||||||||
| ||||||||||||||||||||
Balance as of April 30, 2006 | 16,366,728 | 1,637 | 5,301,502 | 525,680 | (3,231,792 | ) | (1,858,644 | ) | (5,162 | ) | ||||||||||
| ||||||||||||||||||||
Exercise of warrants | 10,000 | 1 | 8,986 | |||||||||||||||||
Exercise of warrants | 45,045 | 5 | 40,445 | |||||||||||||||||
Exercise of warrants | 16,000 | 2 | 14,278 | |||||||||||||||||
Common shares issued for settlement of severance liability to ex-officer | 141,599 | 14 | 113,116 | |||||||||||||||||
Exercise of warrants | 43,667 | 4 | 39,364 | |||||||||||||||||
Exercise of warrants | 17,971 | 2 | 15,937 | |||||||||||||||||
Exercise of warrants | 43,667 | 4 | 38,891 | |||||||||||||||||
Exercise of warrants | 16,000 | 2 | 14,251 | |||||||||||||||||
Exercise of warrants | 158,090 | 16 | 141,616 | |||||||||||||||||
Issue of common shares for property payment | 43,166 | 4 | 53,841 | |||||||||||||||||
Exercise of warrants | 64,120 | 6 | 57,863 | |||||||||||||||||
Exercise of warrants | 61,171 | 6 | 53,818 | |||||||||||||||||
Exercise of stock options | 24,000 | 2 | 17,998 | |||||||||||||||||
Issuance of common shares for professional services | 342,780 | 34 | 438,725 | |||||||||||||||||
Brokered private placement of units-net | 400,000 | 40 | 363,960 | |||||||||||||||||
Brokered private placement of units- net | 550,000 | 55 | 498,923 | |||||||||||||||||
Stock based compensation-Directors and Officers | 451,273 | |||||||||||||||||||
Exercise of stock options | 50,000 | 5 | 37,495 |
F-8
Issuance of common shares for property payment | 133,334 | 13 | 99,987 | |||||||||||||||||
Issuance of common shares for professional services | 160,000 | 16 | 131,184 | |||||||||||||||||
Issuance of common shares for professional services | 118,800 | 12 | 152,052 | |||||||||||||||||
Issue of shares for flow-through warrants | 200,000 | 20 | 153,980 | (154,000 | ) | |||||||||||||||
Issue of shares for special warrants | 404,000 | 41 | 375,679 | (371,680 | ) | |||||||||||||||
Issue of 2,823,049 flow- through warrants -net | 1,916,374 | |||||||||||||||||||
Issue of 334,218 unit special warrants-net | 230,410 | |||||||||||||||||||
Issue of 3,105,358 common shares for 2,823,049 flow through warrants | 3,105,358 | 310 | 1,916,064 | (1,916,374 | ) | |||||||||||||||
Issue of 367,641 common shares for 334,218 unit special warrants | 367,641 | 37 | 230,373 | (230,410 | ) | |||||||||||||||
Registration rights penalty expense | 188,125 | |||||||||||||||||||
Foreign currency translation | (58,446 | ) | (58,446 | ) | ||||||||||||||||
Net loss for the year | (3,703,590 | ) | (3,703,590 | ) | ||||||||||||||||
Balance April 30, 2007 | 22,883,137 | 2,288 | 10,949,726 | 0 | (6,935,382 | ) | (3,762,036 | ) | (63,608 | ) | ||||||||||
| ||||||||||||||||||||
Shares for property payment | 136,364 | 13 | 57,239 | |||||||||||||||||
Stock based compensation | 584,328 | |||||||||||||||||||
Unrealized gain on available-for-sale securities net of deferred taxes | 9,000 | 9,000 | ||||||||||||||||||
543,615 flow through units | 543,615 | 54 | 227,450 | |||||||||||||||||
1,916,666 units-net | 1,916,666 | 192 | 698,110 | |||||||||||||||||
1,071,770 flow through units | 1,071,770 | 108 | 449,379 | |||||||||||||||||
2,438,888 units-net | 2,438,888 | 244 | 1,036,622 | |||||||||||||||||
Expenses relating to issue of units | (141,080 | ) | ||||||||||||||||||
Compensation expense on issue of warrants | 123,079 | |||||||||||||||||||
Foreign currency translation | 251,082 | 251,082 | ||||||||||||||||||
Net loss for the year | (4,953,775 | ) | (4,953,775 | ) | ||||||||||||||||
Balance as of April 30, 2008 | 28,990,440 | 2,899 | 13,984,853 | (11,889,157 | ) | (4,693,693 | ) | 196,474 |
Common Stock | Additional | |||||||||||||||||||
Shares (000s) | Amount | Paid In Capital | Accumulated (Deficit) | Stockholders’ Equity | ||||||||||||||||
Balances, December 31, 2019 | 627 | $ | 49,260 | $ | (49,260 | ) | (16,509 | ) | $ | (16,509 | ) | |||||||||
2020 Activity: | ||||||||||||||||||||
Net (Loss) | - | $ | - | - | (297,519 | ) | $ | (297,519 | ) | |||||||||||
Private placement | 35,109 | $ | 3,511 | 347,582 | - | $ | 351,093 | |||||||||||||
Stock issued for services | 103,623 | $ | 10,362 | - | - | $ | 10,362 | |||||||||||||
Stock issued to VitaNova Partners LLC | 55,613 | $ | 5,561 | - | - | $ | 5,561 | |||||||||||||
Balances, December 31, 2020 | 194,972 | $ | 68,694 | $ | 298,322 | (314,028 | ) | $ | 52,988 | |||||||||||
2021 Q1 Three Month Activity: | ||||||||||||||||||||
Net (Loss) | - | $ | - | - | (192,804 | ) | $ | (192,804 | ) | |||||||||||
Private placement | 20,500 | $ | 2,051 | 202,985 | - | $ | 205,036 | |||||||||||||
Balances, March 31, 2021 | 215,472 | 70,745 | 501,307 | (506,832 | ) | 65,220 |
The accompanying notes to condensed financial statements are an integral part of these consolidated financial statements.
F-9
F-6 |
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)
VETANOVA INC
Notes to ConsolidatedCondensed Financial StatementsApril 30, 2008
For the Years ended December 31, 2020 and April 30, 2007(Amounts expressedDecember 31, 2019
Note 1 – Organization and Business
VETANOVA INC (“the Company) is in US Dollars)the business of building and operating sustainable photovoltaic (“PV”) solar powered, state of the art, greenhouse facilities which grow high value greenhouse produce.
1. BASIS OF PRESENTATION
The audited consolidated financial statements includeAs its initial development project, the accountsCompany expects to purchase, develop and operate four adjoining parcels of Yukon Gold Corporation, Inc. (the “Company”) and its wholly owned Canadian operating subsidiary, Yukon Gold Corp.approximately 39 acres each, totaling approximately 157 acres in rural Pueblo County, Colorado (“YGC”Pueblo Complex”). All material inter-company accountsThe Pueblo Complex is currently majority owned by VitaNova Partners, LLC (“VitaNova”). The Pueblo Complex has an existing greenhouse facility consisting of 90,000 sq ft of growing space and transactions have been eliminated.15,000 sq ft of warehouse space, another partially built greenhouse and two parcels of vacant land.
2. GOING CONCERN
In 2020, VitaNova began acquiring and now owns or controls a supermajority of the preferred or controlling equity interests of the four parcels in the Pueblo Complex. The Pueblo Complex was significantly underpowered with only 300KVA of electrical power and no natural gas available. The lack of power made the initial greenhouse facility unsuitable for its intended purpose. Since acquiring control VitaNova has installed 1500KVA electrical service and is retrofitting the existing greenhouse with electrical environmental equipment that can be solar powered.
The Company received preliminary approval from C-PACE, a Colorado specialized solar financing program developed by federal, state and county governments. The Company is in the process of developing engineering necessary to complete the C-Pace financing application.
The Company recently completed a private placement and raised $556,129 by issuing 55,612,900 common shares along with 55,612,900 2-year warrants exercisable at $0.20 per share. VitaNova and John McKowen (“McKowen”) are considered affiliates and control entities of the Company. The Company currently has no source for operating revenueindependent directors. Both VitaNova and the Company have a common board member, Mr. McKowen. The Company expects to incur significant expenses before establishing operating revenue.appoint independent directors after the purchase of Directors and Officers insurance.
On July 5, 2018, Mr. McKowen purchased a control block of 440,000 common shares of the acquired shell and appointed himself as its sole board member and Chief Executive Officer. On July 17, 2020, Mr. McKowen transferred the control block to VitaNova and began restructuring the Company. The Company hascurrently is a neednon-reporting publicly traded shell on OTC Market Pink Sheets, symbol VTNA. As part of the restructuring, the Company issued 55,612,837 common shares to VitaNova and 29,369,230 common shares to Mr. McKowen, which is proportional to Mr. McKowen’s ownership of VitaNova.
Mr. McKowen was also issued 58,738,460 shares that are subject to repurchase by the Company for equity capitala price of $0.0001 per share, of which 29,369,230 shares will be released from repurchase if warrants issued in Company’s recent private placement are exercised to acquire at least 42,140,266 shares of Common Stock; and financing for working capital29,369,230 shares will be released from repurchase if, prior to December 31, 2022, the Company completes a “sale lease back” of a solar powered property and exploration and developmentreceives gross proceeds of its properties. Becausea least $6,000,000 from the sale. For purposes of continuing operating losses, the Company’s continuance as a going concernfederal securities laws, Mr. McKowen is dependent upon itsdeemed to beneficially own 56,052,837 shares purchased by VitaNova because of his ability to obtain adequate financingcontrol VitaNova, as an officer and to reach profitable levelsmember of operation. The Company’s future success is dependent upon its continued ability to raise sufficient capital, not only to maintain its operating expenses, but to explore for ore reserves and develop those it has on its mining claims. There is no guarantee that such capital will continue to be available on acceptable terms, if at all or ifVitaNova.
On February 1, 2021, the Company will attain profitable levelsfiled a registration statement Form 10 to voluntarily register common stock, par value $0.0001per share of operation.
Management has initiated plansthe Company, pursuant to raise equity funding throughSection 12(g) of the issuanceSecurities Exchange Act of common shares including flow-through shares.1934, or the Exchange Act. The Company was successful in raising funds (net)believes that when the Form 10 becomes effective, 60 days after the Form 10 filing, it will no longer be a shell company
F-7 |
Note 2 – Summary of approximately $4 million duringSignificant Accounting Policies
Basis of Presentation
The financial statements and related disclosures have been prepared pursuant to the year ended April 30, 2006, which assisted the Company in meeting its commitmentsrules and requirements for project expenses and general and administrative expenses. The Company also raised (net) approximately $1.3 million during the six months ended October 31, 2006. The Company raised (net) approximately $1.9 million through subscription of flow-through special warrants and raised (net) approximately $230,000 through subscription of unit special warrants during the three months ended January 31, 2007. The Company further raised an additional (net) approximately $227,000 through subscription of flow-through units and raised (net) approximately $557,000 through subscription of units during the three months ended October 31, 2007. The Company further raised approximately (net) $450,000 through subscription of flow-through units and raised (net) approximately $1,037,000 through subscription of units during the three months ended January 31, 2008. The Company's common shares are listed on the Toronto Stock Exchange (the “TSX”) and included for quotation on the Over-The-Counter Bulletin Board maintained by the NASD in the United States. The tradingregulations of the Company's stock in both the United StatesSecurities and Canada has expanded its investor base, as the Company continues to explore sources of funding from both the United States and Canada.
These consolidatedExchange 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 generally acceptable accounting principles applicable to a going concern. Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying consolidated financial statements.States.
3. NATURE OF OPERATIONS
The Company is an exploration stage mining company and has not yet realized any revenue from its operations. It is primarily engaged in acquisition, exploration and development of its two mining properties, both located in the Yukon Territory in Canada. The Company has not yet determined whether these properties contain mineral reserves that are economically recoverable. The business of mining and exploring for minerals involves a high degree of risk and there can be no assurances that current exploration programs will result in profitable mining operations.
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a) Use of EstimatesPreparation
The preparation of financial statements in accordanceconformity with generally accepted accounting principles generally accepted in the United States of America requires management to make estimates and assumptions. These estimates and assumptions that affect the reported amounts reported inof assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and related notes to financial statements. These estimates are based on management's best knowledgethe reported amounts of current eventsrevenues and actionsexpenses during the Company may undertake in the future.reported period. Actual results may ultimatelycould differ materially from suchthose estimates. Significant estimates include accruals, valuation allowance, fair value of stock for services and estimates for calculation for stock based compensation.
F-10
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D
b) Cash and Cash Equivalents
Cash and cash equivalents
For purposes of reporting cash flows, the Company considers cash and cash equivalents to include cash on hand, amounts due from banks, and any other highly liquid investments with a maturityoriginal maturities of three months90 days or less. Those are readily convertible into cash and not subject to significant risk from fluctuations in interest rates. The carryingrecorded amounts for cash equivalents approximate fair values because ofvalue due to the short maturity of those instruments.
c) Other Financial Instruments
The carrying amounts of the Company’s restricted cash, restricted deposit, accounts receivable, exploration tax credit receivable and accounts payable and accrued liabilities approximates fair values because of the short maturityshort-term nature of these financial instruments.
Commodity Price Risk:
The abilityDuring the years ended December 31, 2020 and December 31, 2019 the Company did not maintain its own bank account. On July 17, 2020, VitaNova acquired a super majority of the Company, which at the time was a shell. At the time, the Company had no assets at, and its operating capital was provided by VitaNova pursuant to develop its properties and the future profitabilitya Promissory Note dated August 17, 2020. On September 20, 2020, VitaNova commenced a private placement on behalf of the Company is directlyand raised $351,093 during the year ended December 31, 2020. The proceeds from the Company’s capital raise were deposited into VitaNova’s bank account and recorded on the Company’s books as “Due from Related Party.” In 2021, the Company completed its private placement by raising an additional $205,036. Those proceeds were deposited into a Company bank account opened on February 23, 2021.
Due from related toparty – VitaNova Partners, LLC
VitaNova owns approximately 28.75% of the market price of certain minerals.
Foreign exchange risk:
Company. The Company conducts mostcurrently has one director who is also the Company’s Chief Executive Officer as well as the Chief Executive Officer and Secretary of its operating activitiesVitaNova.
During 2020, the Company’s funds were held as due the Company in Canadian dollars. Thea bank account owned by VitaNova. For the year ended December 31, 2020, VitaNova held $51,179 for the benefit of the Company. For the year ended December 31, 2019, the Company is therefore subject to gains or lossesrecorded a liability due to fluctuations in Canadian currency relativea related party, VitaNova, of $6,514 for expenses incurred by the Company but paid by VitaNova.
Revenue and Direct cost of revenue
During 2020, the Company subleased its leased land to an unrelated entity. The subleased revenue is shown as revenue and the US dollar.
d) Long-term Financial Instruments
The fair value of eachassociated cost of the Company’s long-term financial assets and debt instrumentssublease is based on the amount of future cash flows associated with each instrument discounted using an estimate of what the Company’s current borrowing rate for similar instruments of comparable maturity would be.
e) Property, Plant and Equipment
Property, Plant, and Equipment are recorded at cost less accumulated amortization. Amortization is provided commencing in the month following acquisition using the following annual rate and method:
f) Operating and Capital Leases
Costs associated with operating leases are expensedrecognized as incurred. Thea direct cost of assets acquired via capital leases are capitalized and amortized over their useful lives. An offsetting liability is established to reflect the future obligation under capital leases. This liability is reduced by the future principal payments.this revenue.
F-11
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’DIncome Taxes
g) Foreign Currency Translation
The Company’s operating subsidiary is a foreign private company and maintains its books and records in Canadian dollars (the functional currency). The subsidiary’s financial statements are converted to US dollars for consolidation purposes. The translation method used is the current rate method, which is the method mandated by SFAS No. 52 where the functional currency is the foreign currency. Under the current rate method all assets and liabilities are translated at the current rate, stockholders’ equity accounts are translated at historical rates and revenues and expenses are translated at average rates for the year.
Due to the fact that items in the financial statements are being translated at different rates according to their nature, a translation adjustment is created. This translation adjustment has been included in Accumulated Other Comprehensive Income (Loss).
h) Income taxes
The Company accounts for income taxes under the provisions of SFAS No. 109,asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements orstatements. Under this method, the Company has determined the deferred tax returns. Deferred income taxes are provided using the liability method. Under the liability method, deferred income taxes are recognized for all significant temporary differences between the tax and financial statement bases of assets and liabilities.
Current income tax expense (recovery) isliabilities on the amountbasis of income taxes expected to be payable (recoverable) for the current period. A deferred tax asset and/or liability is computed for both the expected future impact of differences between the financial statement and tax basesbasis of assets and liabilities andby using enacted tax rates in effect for the year in which the differences are expected futureto reverse. The effect of a change in tax benefit to be derived from tax losses. Valuation allowances are established when necessary to reducerates on deferred tax asset to the amount expected to be “more likely than not” realized in future tax returns. Tax lawassets and rate changes are reflectedliabilities is recognized in income in the period such changes are enacted.
i) Revenue Recognition
The Company’s revenue recognition policies are expected to follow common practice inthat includes the mining industry. Revenue is recognized when concentrate or dore bars, in the case of precious metals, is produced in a mill processing ore from one or more mines. The only condition for recognition of revenue in these instances is the production of the dore or concentrate. In order to get the ore to a concentrate stage the ore must be mined and transported to a mill where it is crushed and ground. The ground product is then processed by gravity separation and/or flotation to produce a concentrate. In some circumstances chemical treatment is used to extract the precious metals from the concentrate into a solution. This solution is then subjected to various processes to precipitate the precious metals back to a solid state that can be melted down and poured into a mould to produce a dore bar (a combination of gold and silver).
j) Comprehensive Incomeenactment date.
The Company has adopted SFAS No. 130 Reporting Comprehensive Income. This standard requires companiesrecognizes deferred tax assets to disclose comprehensive income in their consolidated financial statements.the extent that it believes that these assets are more likely than not to be realized. In addition to items included in net income, comprehensive income includes items currently charged or credited directly to stockholders’ equity,making such as foreign currency translation adjustments.
F-12
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D
k) Long-Lived Assets
In accordance with Financial Accounting Standard Board Statement No. 144,a determination, the Company records impairmentconsiders all available positive and negative evidence, including future reversals of long-livedexisting taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, it would make an adjustment to be held and used or to be disposed of when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less thandeferred tax asset valuation allowance, which would reduce the carrying amount. At April 30, 2008 and 2007, no impairments were recognized. Amortization expenseprovision for the years ended April 30, 2008 and 2007 was $21,877 and $12,731 respectively.income taxes.
l) Acquisition, Exploration and Evaluation Expenditures
The Company is an exploration stage mining company and has not yet realized any revenue from its operations. It is primarily engaged in the acquisition and exploration of mining properties. Mineral property exploration costs are expensed as incurred. Mineral property payments are capitalized only if the Company is able to allocate any economic value beyond proven and probable reserves. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property will be capitalized. For the purpose of preparing financial information, the Company is unable to allocate any economic value beyond proven and probable reserves and hence all property payments are considered to be impaired and accordingly written off to project expense. All costs associated with a property that has the potential to add to the Company’s proven and probable reserves are expensed until a final feasibility study demonstrating the existence of proven and probable reserves is completed. No costs have been capitalized in the periods covered by these financial statements. Once capitalized, such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.
Mineral property acquisition costs will also be capitalizedrecords uncertain tax positions in accordance with ASC 740 on the FASB Emerging Issues Task Force ("EITF") Issue 04-2 when management has determined that probable future benefits consistingbasis of a contribution to future cash inflows have been identifiedtwo-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that adequate financial resources are available or are expectedmeet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be available as required to meetrealized upon ultimate settlement with the terms of property acquisition and budgeted exploration and development expenditures. Mineral property payments are expensed as incurred if the criteria for capitalization is not met.related tax authority.
To date, mineral property exploration costs have been expensed as incurred. As of the date of these financial statements, the Company has incurred only property payments and exploration costs which have been expensed. To date the Company has not established any proven or probable reserves on its mineral properties.
m) Stock Based Compensation
On December 16, 2004, the Financial Accounting Standards Board (“FASB”) issued FASB Statement No.123 (revised 2004), “Share-Based Payment” (“SFAS 123(R)”), which is a revision of FASB Statement No.123, Accounting for Stock-Based Compensation. The Company had adopted the provisions of SFAS 123 (R) on May 1, 2005. As of April 30, 2008 there was $17,508 of unrecognized expense related to non-vested stock-based compensation arrangements granted. The total stock-based compensation expense relating to all employees and non employees for the years ended April 30, 2008 and 2007 was $584,328 and $451,273 respectively.
n) Earnings or Loss per Share
The Company has adopted FAS No. 128, “Earnings per Share”, which requires disclosurerecognizes interest and penalties related to unrecognized tax benefits on the financial statementsincome tax expense line in the accompanying consolidated statement of “basic”operations. As of December 31, 2020, and “diluted” lossDecember 31, 2019, no accrued interest or penalties are included on the related tax liability line in the balance sheet and no deferred tax asset is recognized.
Net Income (Loss) per share. Share
Basic lossnet (loss) per share is computed by dividing net lossincome (loss) attributed to VETANOVA available to common shareholders for the period by the weighted average number of common shares outstanding for the year.period. Diluted net income (loss) per share is computed by dividing the net income for the period by the weighted average number of common and potential common shares outstanding during the period.
As of December 31, 2020, there were no dilutive effect from the warrants issued since it would be anti-dilutive. As of December 31, 2019, there were no warrants or options outstanding.
Accounting for Equity Raise
The Company recently completed a private placement and raised $556,129 by issuing 55,612,900 common shares along with 55,612,900 warrants expiring on September 30, 2022 exercisable at $0.20 per share. During the twelve months ended December 31, 2020, the Company closed on $351,092 in equity and issued 35,109,231 common shares and 35,109,231 warrants. Accounting Standards Codification (“ASC”) requires the Company to first analyze the warrant to determine if the warrant is a liability or equity instrument.
The warrants in the offering qualifies as equity. The issued warrant does not obligate the Company to repurchase its shares by transferring an asset. The warrant does not obligate the Company to settle the warrant by issuing a variable number of shares if the monetary value of the obligation is based on a predetermined fixed amount, variation in something other than the issuer’s stock price, or variations inversely related to the issuers stock price. Therefore, since there is no obligation on behalf of the Company, the warrants should be classified as equity.
The next step is to determine the fair value of the equity unit. The Company’s offering does not meet any of the four areas of ASC 820-10-30-3A requiring a fair value calculation; therefore, fair value equals the actual transaction value. The next step is to compute the fair in order to determine the allocation of value between the common shares and the warrants issued (ASC 815). The Company performed this calculation which gave a value of 50% to the warrant and 50% to the common shares.
The following variables were used to calculate the warrant value:
● | Annualized volatility of 865% | |
● | Expected life in years of 1.02 | |
● | Discount rate – bond equivalent (US Treasury 5-year coupon rate) of 0.37% |
The common share value was computed by evaluating each equity raise closing date to VTNA’s market stock price to the price issue, which was $0.01/share.
Note 3 – Equity Transactions
The Company has authorized 500,000,000 shares of common stock with a par value of $0.0001. The total issued common stock as of December 31, 2020 and December 31, 2019 was 194,971,866 and 626,789 shares, respectfully.
During the year ended December 31, 2020 there were the following equity transactions:
● | 91,127,145 shares issued to the Company’s founders, officers and board members; | |
● | 12,495,700 shares issued to the Company’s consultants; | |
● | 55,612,837 shares issued to VitaNova Partners, LLC and | |
● | 35,109,231 shares issued to outside investors. |
During the year ended December 31, 2019 there was no equity transactions.
Note 4 – Income Taxes
On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Act”), which significantly changed U.S. tax law. The Act lowered the Company’s U.S. statutory federal income tax rate from 35% to 21% effective January 1, 2018, while also imposing a deemed repatriation tax on previously deferred foreign income. The Act also created a new minimum tax on certain future foreign earnings. The impact of the Act had no material impact on the Company’s tax liability and deferrals.
We record tax positions as liabilities in accordance with ASC 740 and adjust these liabilities when our judgement changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the recognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of December 31, 2019, and 2018 we have not recorded any uncertain tax positions in our financial statements. The Company has not filed tax returns for the years ended December 31, 2020, December 31, 2019 and December 31, 2018. Prior to January 31, 2018, there was no financial or taxable transactions since 2011, so the company does not anticipate any material penalties.
Book loss reconciliation to estimated taxable income is as follows:
2020 | 2019 | |||||||
Book loss | $ | (297,519 | ) | $ | (4,515 | ) | ||
Tax adjustments: | ||||||||
None | - | - | ||||||
Estimate of taxable income | $ | (297,519 | ) | $ | (4,515 | ) |
The Company will recognize future accrued interest and penalties related to unrecognized tax benefits in income tax expense if incurred. At December 31, 2020 and December 31, 2019, we had no unrecognized tax benefits in income tax expense.
The components of the deferred tax asset are as follows:
2020 | 2019 | |||||||
Current deferred tax asset: | ||||||||
Net operating loss carryforwards | $ | (83,664 | ) | $ | (16,509 | ) | ||
Other adjustments: | ||||||||
None | - | - | ||||||
Total cumulative deferred tax asset | (83,664 | ) | (16,509 | ) | ||||
Valuation allowance | 83,664 | 16,509 | ||||||
Effective income tax asset | $ | - | $ | - |
Income tax provision is summarized below (in thousands):
2020 | 2019 | |||||||
Income tax provision: | ||||||||
Current benefit (expense) | ||||||||
Federal | ||||||||
State | $ | - | $ | - | ||||
Total current | - | - | ||||||
Deferred benefit (expense) | ||||||||
Federal | 62,479 | 3,467 | ||||||
State | 13,127 | 825 | ||||||
Total deferred | 76,254 | 4,292 | ||||||
Less: Valuation allowance | (72,254 | ) | (4,292 | ) | ||||
Total | $ | - | $ | - |
Effective and stated tax rate: | ||||
Federal | 21.00 | % | ||
State | 4.63 | % | ||
Total | 25.63 | % |
Cumulative Net Operating Loss Carryforward: | ||||
2018 | $ | 3,118 | ||
2019 | 4,292 | |||
2020 | 76,254 | |||
$ | 83,664 |
For the years ended December 31, 2020 and December 31, 2019, the deferred tax asset of $80,076 and $16,509, respectively, has a valuation allowance of $83,664 and $16,509, respectively, since management has determined the tax benefit cannot be reasonably assured of being used in the near future. The net operating loss carryforward, if not used, will begin to expire in 2045, and is severely restricted as per the Internal Revenue Code if there is a change in ownership.
Note 5 – Commitments and Contingencies
The Company has no commitments or contingencies.
Note 6 – Related Party Transactions
VitaNova Partners, which owns approximately 28.75% of VETANOVA, is providing management, including financial oversight, of VETANOVA. As of December 31, 2020 VitaNova Partners owes the Company $65,179 and as of December 31, 2019, VitaNova Partners had advanced $6,514 to the Company.
On July 15, 2020, the Company and VitaNova entered into a consulting agreement whereby VitaNova would provide management services until the current private placement offering is completed and the shareholders of the Company can properly elect an independent board of directors and appoint Company officers. VitaNova is paid $456,000 annually for its management services. Payments are made in 12 monthly installments of $38,000. On December 15, 2020 the consulting agreement was amended to reduce payments to $19,000 a month effective January 1, 2021.
During the year ended December 31, 2020 there were the following equity transactions involving related parties:
● | 100,622,845 shares issued to the Company’s founders, officers and board members, and | |
● | 55,612,837 shares issued to VitaNova Partners, LLC. |
Note 7 – Subsequent Events
On February 5, 2021, Ms. Louise Lowe resigned as a member of the Company’s board. She had no disagreements with management.
On March 12, 2021, the Company received an additional $205,000 and issued 20,503,600 shares of the Company’s stock and 20,503,600 warrants, with each warrant to purchase one share of the Company’s stock at $0.20/share. The warrants expire on September 30, 2022.
VETANOVA INC
Interim Condensed Financial Statements
For the Quarterly Periods Ended March 31, 2021 and 2020
Unaudited
VETANOVA INC
Condensed Balance Sheets
As of | Dec 31, 2020 | |||||||
ASSETS | March 31, 2021 | (Derived from audit) | ||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 158,683 | $ | - | ||||
Prepaid expenses | 533 | 13,734 | ||||||
Due from related party - Vita Nova Partners LLC | - | 51,179 | ||||||
Other current assets | - | - | ||||||
Total Current Assets | 159,216 | 64,913 | ||||||
Long Term Assets | ||||||||
Property, equipment and software, net | - | - | ||||||
Other long term assets | - | - | ||||||
Total Long Term Assets | - | - | ||||||
TOTAL ASSETS | $ | 159,216 | $ | 64,913 | ||||
LIABILITIES & STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | - | $ | - | ||||
Accrued liabilities | 10,000 | 11,925 | ||||||
Current portion of notes payable | - | - | ||||||
Due to related party - VitaNova Partners LLC | 83,995 | - | ||||||
Other current liabilities | - | - | ||||||
Total Current Liabilities | 93,995 | 11,925 | ||||||
Notes Payable, net of current portion | - | - | ||||||
TOTAL LIABILITIES | 93,995 | 11,925 | ||||||
Commitments & Contingencies (Notes 4) | ||||||||
Stockholders’ Equity | ||||||||
Common stock, $0.0001 par value, 500,000,000 shares authorized, 215,475,502 and 194,971,866 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectfully | 70,745 | 68,694 | ||||||
Additional paid-in capital | 501,307 | 298,322 | ||||||
Accumulated (deficit) | (506,832 | ) | (314,028 | ) | ||||
TOTAL STOCKHOLDERS’ EQUITY | 65,220 | 52,988 | ||||||
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY | $ | 159,216 | $ | 64,913 |
The accompanying notes to condensed financial statements are an integral part of these statements.
F-14 |
VETANOVA INC
Condensed Statements of Operations
(Unaudited)
Three Months ended March 31, | ||||||||
2021 | 2020 | |||||||
Revenue | $- | $- | ||||||
Direct cost of revenue | - | - | ||||||
Gross Margin | - | - | ||||||
Operating Expenses | ||||||||
General and administrative | 192,804 | - | ||||||
Depreciation and amortization | - | - | ||||||
Total Operating Expenses | 192,804 | - | ||||||
Profit (Loss) from Operations | (192,804 | ) | - | |||||
Other Income (Expense) | ||||||||
Other | - | - | ||||||
Total Other Income (Expense) | - | - | ||||||
Net Profit (Loss) Before Taxes | (192,804 | ) | - | |||||
Income Tax (Provision) Benefit | - | - | ||||||
Net Profit (Loss) | $ | (192,804 | ) | $ | - | |||
(Loss) per Common Share - Basic | $ | - | $ | - | ||||
(Loss) per Common Share - Dilutive | $ | - | $ | - | ||||
Weighted Average Shares Outstanding: | ||||||||
Basic | 196,794,444 | 626,989 | ||||||
Dilutive | 196,794,444 | 626,989 |
The accompanying notes to condensed financial statements are an integral part of these statements.
F-15 |
VETANOVA INC
Condensed Statements of Cash Flows
(Unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2021 | 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net Loss | $ | (192,804 | ) | $ | - | |||
Adjustments to reconcile net (loss) to net cash used in operating activities: | ||||||||
Depreciation & amortization | - | - | ||||||
Stock issued for services | - | - | ||||||
Net change in operating assets and liabilities: | ||||||||
Decrease in prepaid expenses | 13,201 | - | ||||||
Increase in related party payable | 135,174 | - | ||||||
(Decrease) Increase in accounts payable | (1,926 | ) | - | |||||
Net Cash Used in Operating Activities | (46,354 | ) | - | |||||
Cash Flows from Investing Activities | - | - | ||||||
Cash Flows from Financing Activities | ||||||||
Sale of units | 205,036 | - | ||||||
Cash Flows from Financing Activities | 205,036 | - | ||||||
Net Change in Cash & Cash Equivalents | 158,683 | - | ||||||
Beginning Cash & Cash Equivalents | - | - | ||||||
Ending Cash & Cash Equivalents | $ | 158,683 | $ | - |
The accompanying notes to condensed financial statements are an integral part of these statements.
F-16 |
VETANOVA INC
Notes to Condensed Financial Statements
For the Three Months Ended March 31, 2021 and March 31, 2020
Note 1 – Organization and Business
VETANOVA INC (“the Company) is in the business of building and operating sustainable photovoltaic (“PV”) solar powered, state of the art, greenhouse facilities which grow high value greenhouse produce.
As its initial development project, the Company expects to purchase, develop and operate four adjoining parcels of approximately 39 acres each, totaling approximately 157 acres in rural Pueblo County, Colorado (“Pueblo Complex”). The Pueblo Complex is currently majority owned by VitaNova Partners, LLC (“VitaNova”). The Pueblo Complex has an existing greenhouse facility consisting of 90,000 sq ft of growing space and 15,000 sq ft of warehouse space, another partially built greenhouse and two parcels of vacant land.
In 2020, VitaNova began acquiring and now owns or controls a supermajority of the preferred or controlling equity interests of the four parcels in the Pueblo Complex. The Pueblo Complex was significantly underpowered with only 300KVA of electrical power and no natural gas available. The lack of power made the initial greenhouse facility unsuitable for its intended purpose. Since acquiring control VitaNova has installed 1500KVA electrical service and is retrofitting the existing greenhouse with electrical environmental equipment that can be solar powered.
The Company received preliminary approval from C-PACE, a Colorado specialized solar financing program developed by federal, state and county governments. The Company is in the process of developing engineering necessary to complete the C-Pace financing application.
The Company recently completed a private placement and raised $556,129 by issuing 55,612,900 common shares along with 55,612,900 2-year warrants exercisable at $0.20 per share. VitaNova and John McKowen (“McKowen”) are considered affiliates and control entities of the Company. The Company currently has no independent directors. Both VitaNova and the Company have a common board member, Mr. McKowen. The Company expects to appoint independent directors after the purchase of Directors and Officers insurance.
On July 5, 2018, Mr. McKowen purchased a control block of 440,000 common shares of the acquired shell and appointed himself as its sole board member and Chief Executive Officer. On July 17, 2020, Mr. McKowen transferred the control block to VitaNova and began restructuring the Company. The Company currently is a non-reporting publicly traded shell on OTC Market Pink Sheets, symbol VTNA. As part of the restructuring, the Company issued 55,612,837 common shares to VitaNova and 29,369,230 common shares to Mr. McKowen, which is proportional to Mr. McKowen’s ownership of VitaNova.
Mr. McKowen was also issued 58,738,460 shares that are subject to repurchase by the Company for a price of $0.0001 per share, of which 29,369,230 shares will be released from repurchase if warrants issued in Company’s recent private placement are exercised to acquire at least 42,140,266 shares of Common Stock; and 29,369,230 shares will be released from repurchase if, prior to December 31, 2022, the Company completes a “sale lease back” of a solar powered property and receives gross proceeds of a least $6,000,000 from the sale. For purposes of federal securities laws, Mr. McKowen is deemed to beneficially own 56,052,837 shares purchased by VitaNova because of his ability to control VitaNova, as an officer and member of VitaNova.
On February 1, 2021, the Company filed a registration statement Form 10 to voluntarily register common stock, par value $0.0001per share of the Company, pursuant to Section 12(g) of the Securities Exchange Act of 1934, or the Exchange Act. The Company believes that when the Form 10 becomes effective, 60 days after the Form 10 filing, it will no longer be a shell company
F-17 |
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.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ materially from those estimates.
Cash and cash equivalents
For purposes of reporting cash flows, the Company considers cash and cash equivalents to include highly liquid investments with original maturities of 90 days or less. Those are readily convertible into cash and not subject to significant risk from fluctuations in interest rates. The recorded amounts for cash equivalents approximate fair value due to the short-term nature of these financial instruments.
During the years ended December 31, 2020 and December 31, 2019 the Company did not maintain its own bank account. In January, 2021, the Company opened a separate bank account; therefore, the cash balance on March 31, 2021 is shown as cash and cash equivalents.
On July 17, 2020, VitaNova acquired a super majority of the Company, which at the time was a shell. At the time, the Company had no assets at, and its operating capital was provided by VitaNova pursuant to a Promissory Note dated August 17, 2020. On September 20, 2020, VitaNova commenced a private placement on behalf of the Company and raised $351,093 during the year ended December 31, 2020. The proceeds from the Company’s capital raise were deposited into VitaNova’s bank account and recorded on the Company’s books as “Due from Related Party.” In 2021, the Company completed its private placement by raising an additional $205,036. Those proceeds were deposited into a Company bank account opened on February 23, 2021.
Due from related party and Due to related party – VitaNova Partners, LLC
VitaNova owns approximately 22.05% of the Company. The Company currently has one director who is also the Company’s Chief Executive Officer as well as the Chief Executive Officer and Secretary of VitaNova.
During 2020, the Company’s funds were held as due the Company in a bank account owned by VitaNova. For the year ended December 31, 2020, VitaNova held $65,179 for the benefit of the Company. The Company
In January, 2021, the Company opened its own bank account.
Income Taxes
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company has determined the deferred tax assets and liabilities on the basis of the differences between the financial statement and tax basis of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.
The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, it would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.
The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.
The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2020, and December 31, 2019, no accrued interest or penalties are included on the related tax liability line in the balance sheet and no deferred tax asset is recognized.
Net Income (Loss) per Share
Basic net (loss) per share is computed by dividing net lossincome (loss) attributed to VETANOVA available to common shareholders for the period by the weighted average number of common shares outstanding plusfor the period. Diluted net income (loss) per share is computed by dividing the net income for the period by the weighted average number of common and potential common shares outstanding during the period.
As of December 31, 2020, and March 31, 2021, there were no dilutive effect from the warrants issued since it would be anti-dilutive.
Accounting for Equity Raise
The Company recently completed a private placement and raised $556,127 by issuing 55,612,900 common shares along with 55,612,900 warrants expiring on September 30, 2022 exercisable at $0.20 per share. During the twelve months ended December 31, 2020, the Company closed on $351,092 in equity and issued 35,109,231 common shares and 35,109,231 warrants. During the three months ended March 31, 2021, the Company closed on $205,035 Accounting Standards Codification (“ASC”) requires the Company to first analyze the warrant to determine if the warrant is a liability or equity instrument.
The warrants in the offering qualifies as equity. The issued warrant does not obligate the Company to repurchase its shares by transferring an asset. The warrant does not obligate the Company to settle the warrant by issuing a variable number of shares if the monetary value of the obligation is based on a predetermined fixed amount, variation in something other than the issuer’s stock equivalents (if dilutive)price, or variations inversely related to the issuers stock optionsprice. Therefore, since there is no obligation on behalf of the Company, the warrants should be classified as equity.
The next step is to determine the fair value of the equity unit. The Company’s offering does not meet any of the four areas of ASC 820-10-30-3A requiring a fair value calculation; therefore, fair value equals the actual transaction value. The next step is to compute the fair in order to determine the allocation of value between the common shares and the warrants forissued (ASC 815). The Company performed this calculation which gave a value of 50% to the warrant and 50% to the common shares.
The following variables were used to calculate the warrant value:
● | Annualized volatility of 865% | |
● | Expected life in years of 1.02 | |
● | Discount rate – bond equivalent (US Treasury 5-year coupon rate) of 0.37% |
The common share value was computed by evaluating each year. There were no common equivalent shares outstanding at April 30, 2008 and 2007 that have been included in dilutive loss per share calculation asequity raise closing date to VTNA’s market stock price to the effects would have been anti-dilutive. At April 30, 2008, there were 1,566,000 options from the 2003 Stock Option Plan and 1,837,500 options from the 2006 Stock Option Plan and 9,001,050 warrants outstanding. At April 30, 2007, there were 2,084,000 options from the 2003 Stock Option Plan and 400,000 options from the 2006 Stock Option Plan and 5,415,703 warrants outstandingprice issue, which was $0.01/share.
o) Flow-Through FinancingNote 3 – Equity Transactions
The Company has financedauthorized 500,000,000 shares of common stock with a portionpar value of its exploration activities through the issue of flow-through shares, which transfer the Canadian tax deductibility of exploration expenditure to the investor. Proceeds received from the issuance of such shares are allocated between the offering of shares and the sale of tax benefits.
F-13
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D
o) Flow-Through Financing-cont'd
$0.0001. The allocation is made based on the difference between the quoted price of the existing shares and the amount the investor pays for the shares. A liability is recognized for the difference.
Resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with the income tax legislation in Canada. On such renunciation, a deferred tax liability is created and the liability recognized at issuance reversed. The Company recognized the benefit of tax losses to offset the deferred tax liability resulting in an income tax recovery.
p) Recent Pronouncements
In July 2006, the FASBtotal issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in enterprises’ financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes”. FIN 48 prescribes a recognition threshold and measurement attributable for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosures and transitions. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measures” (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”), expands disclosures about fair value measurements, and applies under other accounting pronouncements that require or permit fair value measurements. SFAS No. 157 does not require any new fair value measurements, however the FASB anticipates that for some entities, the application of SFAS No. 157 will change current practice. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The Company is currently reviewing the effect, if any, SFAS 157 will have on its financial position and operations.
In September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)”. This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multi employer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plancommon stock as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending afterMarch 31, 2021 and December 15, 2006. The adoption of this statement did not have a material effect on the Company's future reported financial position or results of operations.31, 2020 was 215,475,502 and 194,971,866 shares, respectfully.
In February 2007, the FASB issued SFAS No. 159 (“SFAS 159”) - the fair value option for financial assets and liabilities including in amendment of SFAS 115.
This Statement permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement objectives for accounting for financial instruments. This Statement is effective as of the beginning of an entity’s first fiscal year that begins after November15, 2007, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FASB Statement No. 157, Fair value measurements. The Company is currently evaluating the impact of SFAS No. 159 on its consolidated financial statements.
F-14
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D
p) Recent Pronouncements-cont'd
In September 2006, the Securities and Exchange Commission (“SEC”) issued Staff Accounting Bulletin No. 108 (Topic 1N), “Quantifying Misstatements in Current Year Financial Statements” (“SAB No. 108”). SAB No. 108 addresses how the effect of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB No. 108 requires SEC registrants (i) to quantify misstatements using a combined approach which considers both the balance sheet and income statement approaches; (ii) to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors; and (iii) to adjust their financial statements if the new combined approach results in a conclusion that an error is material. SAB No. 108 addresses the mechanics of correcting misstatements that include effects from prior years. It indicates that the current year correction of a material error that includes prior year effects may result in the need to correct prior year financial statements even if the misstatement in the prior year or years is considered immaterial. Any prior year financial statements found to be materially misstated in years subsequent to the issuance of SAB No. 108 would be restated in accordance with SFAS No. 154, “Accounting Changes and Error Corrections.” Because the combined approach represents a change in practice, the SEC staff will not require registrants that followed an acceptable approach in the past to restate prior years’ historical financial statements. Rather, these registrants can report the cumulative effect of adopting the new approach as an adjustment to the current year’s beginning balance of retained earnings. If the new approach is adopted in a quarter other than the first quarter, financial statements for prior interim periods within the year of adoption may need to be restated. SAB No. 108 is effective for fiscal years ending after November 15, 2006. The implementation of SAB No. 108 did not have a material impact on the Company’s results of operations and financial condition.
In December 2007, the FASB issued SFAS No. 141(R), “Business Combinations”. This Statement replaces SFAS No. 141,Business Combinations.
This Statement retains the fundamental requirements in Statement 141 that the acquisition method of accounting (which Statement 141 called thepurchase method) be used for all business combinations and for an acquirer to be identified for each business combination. This Statement also establishes principles and requirements for how the acquirer: a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree; b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase and c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. SFAS No. 141(R) will apply prospectively to business combinations for which the acquisition date is on or after Company’s fiscal year beginning May 1, 2009.
In December 2007, the FASB issued SFAS No. 160, “Non-controlling Interests in Consolidated Financial Statements”. This Statement amends ARB 51 to establish accounting and reporting standards for the non-controlling (minority) interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a non-controlling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. The Company has not yet determined the impact, if any, that SFAS No. 160 will have on its consolidated financial statements. SFAS No. 160 is effective for the Company’s fiscal year beginning May 1, 2009.
In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133” (“FAS 161”). FAS 161 changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. The guidance in FAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. This Statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. The Company is currently assessing the impact of FAS 161.
F-15
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONT’D
p) Recent Pronouncements-cont'd
In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted Accounting Principles" ("SFAS 162"). SFAS 162 is intended to improve financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. GAAP for nongovernmental entities. SFAS 162 is effective 60 days following the Securities and Exchange Commission's approval of the Public Company Accounting Oversight Board auditing amendments to AU Section 411, "The Meaning of Present Fairly in Conformity with Generally Accepted Accounting Principles." The Company does not expect SFAS 162 to have a material effect on its consolidated financial statements.
5. COMPREHENSIVE LOSS
The components of comprehensive loss are as follows:
For the year | For the year | |||||
ended | ended | |||||
April 30, | April 30, | |||||
2008 | 2007 | |||||
$ | $ | |||||
Net loss | (4,953,775 | ) | (3,703,590 | |||
Other comprehensive income (loss) Unrealized gain on available for sale securities net of deferred taxes | 9,000 | - | ||||
Other comprehensive income (loss) Foreign currency translation | 251,082 | (58,446 | ) | |||
Comprehensive loss | (4,693,693 | ) | (3,762,036 | ) |
The foreign currency translation adjustments are not currently adjusted for income taxes as the Company’s operating subsidiary is located in Canada and the adjustments relate to the translation of the financial statements from Canadian dollars into United States dollars, which are done as disclosed in note 4 (g).
6. PREPAID EXPENSES AND OTHER
Included in prepaid expenses and other is an amount of $54,360 (CDN$54,750) (prior year: $27,280 (CDN$30,284)) being Goods & Services tax receivable from the Federal Government of Canada. Included in prepaid expenses and other is also a deposit of $148,928(CDN$150,000) (prior year: $189,172 (CDN $210,000) with a contractor for diamond drilling at drill sites to be selected by the Company. Prepaid expense for prior year also includes $223,741(CDN$248,374) being a deposit with a geological company for conducting exploration activities at the Mount Hinton and Marg Properties.
F-16
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
7. EXPLORATION TAX CREDIT RECEIVABLE
For the year ended April 30, 2007 and 2006, the Company had a claim to the Yukon exploration tax credit, since it maintained a permanent establishment in the province of Yukon, Canada and had incurred eligible mineral exploration expenses as defined by the federal income tax regulations of Canada. The Company’s expectation of receiving this credit of $483,258 (CDN$536,465) was based on the history of receiving past credits. On March 6, 2008 the Company received $180,970 (CDN$181,658) which represents the 2006 Yukon tax credit of $171,035 (CDN$171,685) plus accumulated interest of $9,935 (CDN$9,973). On March 11, 2008 the Company received $299,207 (CDN$300,344) which represents the 2007 Yukon Tax Credit of $298,864 (CDN$300,000) plus accumulated interest of $343 (CDN$344). The provincial Government of Yukon has discontinued the grant of credit commencing April 1, 2007.
8. PROPERTY, PLANT AND EQUIPMENT
April 30, | April 30, | |||||
2008 | 2007 | |||||
$ | $ | |||||
Computer Equipment | 31,448 | 23,936 | ||||
Furniture and fixtures | 42,350 | 36,160 | ||||
Mining Equipment | 55,997 | - | ||||
Computer Software | 36,355 | |||||
Capital leases: | ||||||
Office Equipment | 17,156 | 15,566 | ||||
Cost | 183,306 | 75,662 | ||||
Less: Accumulated amortization | ||||||
Computer Equipment | 13,490 | 8,723 | ||||
Furniture and fixtures | 14,426 | 7,275 | ||||
Mining Equipment | 2,808 | - | ||||
Computer Software | 6,365 | |||||
Capital leases: | ||||||
Office Equipment | 6,176 | 3,113 | ||||
43,265 | 19,111 | |||||
Net | 140,041 | 56,551 |
F-17
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
April 30, | April 30, | |||||
2008 | 2007 | |||||
$ | $ | |||||
Accounts payable and accrued liabilities are comprised of the following: | ||||||
Trade payables | 53,866 | 30,150 | ||||
Accrued Liabilities-Flow Through Penalty | 91,806 | 34,223 | ||||
Accrued Liabilities-Payroll | 21,418 | 2.614 | ||||
Accrued Liabilities-Consulting Fees | 1,231 | 0 | ||||
Accrued Liabilities-Accounting & Legal | 29,395 | 31,468 | ||||
Accrued Liabilities-Audit Fees | 20,883 | 14,864 | ||||
Accrued Liabilities-Rent Equalization | 2,623 | 1,082 | ||||
Accrued Liabilities-Financing Fees/Penalty | 142,133 | |||||
Accrued Liabilities-Franchise Tax | 3,600 | |||||
221,222 | 260,134 |
10. CAPITAL STOCK
a) Authorized
150,000,000 of Common shares, $0.0001 par value (50,000,000 in 2007)
b) Issued
28,990,440 Common shares (22,883,137 in 2007)
c) Changes to Issued Share Capital
Year ended April 30, 2007
On May 29, 2006 the Company issued 10,000 common shares for the exercise of 10,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $8,987 (CDN$10,000).
On May 29, 2006 the Company issued 45,045 common shares for the exercise of 45,045 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $40,450 (CDN$45,045).
On May 29, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $14,280 (CDN$16,000).
On May 30, 2006 the Company issued 141,599 common shares for the settlement of an accrued liability to an ex officer and director. The accrued severance amount of $113,130 (CDN$128,855) was converted to 141,599 common shares at $0.80 (CDN$0.91) .
On June 22, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $39,368 (CDN$43,667).
F-18
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
c) Changes to Issued Share Capital-cont'd
On June 28, 2006 the Company issued 17,971 common shares for the exercise of 17,971 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $15,939 (CDN$17,971).
On June 28, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $38,895 (CDN$43,667).
On June 28, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $14,253 (CDN$16,000).
On June 29, 2006 the Company issued 158,090 common shares for the exercise of 158,090 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $141,632 (CDN$158,090).
On July 7, 2006 the Company issued 43,166 common shares in settlement of a property payment on the Mount Hinton property. The shares represent $53,845 (CDN$60,000) payment and were valued $1.25 (CDN$1.39) each.
On July 7, 2006 the Company issued 64,120 common shares for the exercise of 64,120 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $57,869 (CDN$64,120).
On July 17, 2006 the Company issued 61,171 common shares for the exercise of 61,171 warrants at $0.88 (CDN$1.00) from a warrant holder in consideration of $53,824 (CDN$61,171).
On August 11, 2006 the Company held in escrow 817,980 restricted shares in total to three consultants for services relating to business promotion and development. These consultants assisted management in the preparation of financial offerings and in arranging meetings and making presentations to the brokerage community and institutional investors in both the United States and Canada. Except for 342,780 common shares which were earned by these consultants as of October 31, 2006, the balance of 475,200 common shares held in escrow were to be released to each consultant in 8 monthly installments of 19,800 common shares commencing November 1, 2006. Out of 475,200 common shares held in escrow, 356,400 common shares were returned to the Company for cancellation. (Refer to Note 12).
On September 7, 2006 the Company issued 24,000 shares to an officer upon exercising 24,000 vested stock options at $0.75 for a total of $18,000.
On October 3, 2006, the Company completed a brokered private placement and issued 400,000 units, where each unit consisted of a common share and a share purchase warrant. The units were priced at $1.00 per unit for a total of $400,000. The Company paid a finders fee of 6% and reimbursed expenses for 3% of the total consideration. The warrants have a two-year term and are exercisable at $1.50 per share in the first twelve months of the term and $2.00 per share in the remaining twelve months of the term. On November 27, 2007 the board of directors approved the extension of the expiry dates of the warrants to October 4, 2009.
On October 3, 2006, the Company completed another brokered private placement and issued 550,000 units, where each unit consisted of a common share and a share purchase warrant. The units were priced at $1.00 per unit for a total of $550,000. The Company paid a finders fee of $33,000 and reimbursed expenses for $18,022 (CDN$20,000). The warrants have a two-year term and are exercisable at $1.50 per share in the first twelve months of the term and $2.00 per share in the remaining twelve months of the term. On November 27, 2007 the board of directors approved the extension of the expiry dates of the warrants to October 4, 2009.
F-19
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
c) Changes to Issued Share Capital-cont'd
On December 12, 2006 the Company issued 50,000 shares to a former officer upon exercising of 50,000 vested stock options at $0.75 for a total of $37,500.
On December 6, 2006 the board of directors authorized the issuance of 133,334 common shares in the amount of $100,000 for a property payment to Atna Resources Ltd., along with a cash payment of $86,805 (CDN$100,000) as per terms of the agreement. The common shares along with the cash payment were delivered to Atna Resources Ltd. on December 12, 2006. This entire payment of $186,805 was expensed in the consolidated statements of operations.
On December 19, 2006 the Company issued 160,000 common shares to a consultant for services rendered. These services related to the consulting agreement dated March 21, 2006. As per terms of that agreement, the Consultant was to provide to the Company market and financial advice and expertise as may be necessary relating to the manner of offering and pricing of securities. The agreement was for a period of twelve months commencing the day of trading of the Company’s stock on the Toronto Stock Exchange (April 19, 2006). As per the agreement, the Consultant was to be compensated a fee equal to 240,000 restricted common shares of the Company with a fair value of $196,800 and was to receive these shares on a monthly basis. Each party was able to cancel the agreement on 30 days notice. The Company cancelled the agreement as of November 30, 2006 and on December 19, 2006 issued 160,000 common shares as full and final consideration.
On December 19, 2006 the Company issued 200,000 common shares in lieu of sale of 200,000 Flow-Through Special Warrants made to a Canadian accredited investor, for $180,000 (CDN$205,020) on December 30, 2005. Each Flow-Through Special Warrant entitled the Holder to acquire one flow-through common share of the Company at no additional cost.
On December 28, 2006, the Company completed a private placement of 2,823,049 flow-through special warrants (which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at a price of $0.90 (CDN$1.05) per warrant and 334,218 unit special warrants at a price of $0.77 (CDN$0.90) per warrant for aggregate gross proceeds to the Company of $2,801,610 (CDN$3,264,996). Each flow-through special warrant entitles the holder to acquire, for no additional consideration, one common share of the Company. Each unit special warrant entitles the holder to acquire, for no additional consideration, one common share and one common share purchase warrant of the Company. Each common share purchase warrant entitles the holder to acquire one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date. In connection with this private placement, the Company agreed to file a prospectus in Canada qualifying the issuance of the common shares and warrants issuable upon the exercise of the special warrants as well as those common shares issuable on exercise of the common share purchase warrants. In addition, the Company agreed to file a registration statement in the United States covering the re-sale of common shares underlying the units and warrants by the respective shareholders. In the event the Company fails to obtain effectiveness for the final prospectus and the registration statement by February 26, 2007 (60 days from the closing date), each flow-through special warrant will entitle the holder to acquire 1.1 common shares on exercise thereof and each unit special warrant will entitle the holder to acquire 1.1 common shares and 1.1 common share purchase warrants on exercise thereof. The flow-through and unit special warrants will be automatically exercised on the earlier of (i) the third business day after the issuance of a receipt for the final prospectus and the effectiveness of the registration statement, or (ii) the four month anniversary of the closing date of the private placement. On closing, Northern Securities Inc., the lead agent received a cash commission of $171,164 (CDN$198,550) as well as 169,042 flow-through compensation options and 23,395 unit compensation options. In addition, as part of the private placement, Limited Market Dealer Inc. received a cash commission of $25,862 (CDN$30,000) as well as 28,571 flow-through compensation options and Novadan Capital Ltd. received a cash payment of $28,362 (CDN$32,900) as well as 32,900 unit compensation options. Each flow-through compensation option entitles the holder to acquire, for no additional consideration, one flow-through compensation warrant, each exercisable into one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. Each unit compensation option entitles the holder to acquire, for no additional consideration, one unit compensation warrant, each exercisable at $0.81 (CDN$0.941) into one common share and one common share purchase warrant of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. In the event the Company fails to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date), each flow-through compensation option will entitle the holder to acquire 1.1 flow-through compensation warrants on exercise thereof and each unit compensation option granted to Northern Securities, Inc. will entitle the holder to acquire 1.1 unit compensation warrants on exercise thereof. The private placement was exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) pursuant to an exemption afforded by Regulation S promulgated under the Securities Act (“Regulation S”).
F-20
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
c) Changes to Issued Share Capital-cont'd
On January 11, 2007, the Company issued its obligated 400,000 common shares and an additional 4,000 common shares as penalty, in lieu of sale of 400,000 Special Warrants to a Canadian accredited investor for $404,000 paid on December 15, 2005. Each Special Warrant entitled its holder to acquire one common share of the Company and one common share purchase warrant at no additional cost. The Company was obligated to have a registration statement become effective within 181 days of the closing. In the absence of a registration statement being declared effective within 181 days of the closing, the Company issued an additional 4,000 common shares to the Canadian accredited investor at no extra cost as a penalty. The Company expensed an amount of $5,000 to registration rights penalty expense under the head General and Administration and credited this to Additional paid in capital.
On April 25, 2007 the Company issued 2,823,049 common shares and an additional 282,309 shares as a penalty, relating to the private placement of 2,823,049 flow-through special warrants on December 28, 2006 (refer to note above). The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The Company expensed an amount of $163,739 to registration rights penalty expense under the head General and Administration and credited this to Additional paid in capital.
On April 25, 2007 the Company issued 334,218 common shares and an additional 33,423 shares as a penalty, relating to the private placement of 334,218 unit special warrants on December 28, 2006 (refer to note above). The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The Company expensed an amount of $19,386 to registration rights penalty expense under the head General and Administration and credited this to Additional paid in capital.
Year ended April 30, 2008
On July 7, 2007 the Company issued 136,364 common shares in settlement of a property payment on the Mount Hinton Property. The shares represent $57,252 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.42 (CDN$0.44) each. The balance 60% payment was paid in cash.
On August 16, 2007 the Company completed a private placement (the “Financing”) with Northern Securities Inc. (“Northern”), acting as agent. The Financing was comprised of the sale of 1,916,666 units (the “Units”) at $0.42 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $802,101 (CDN$862,499.70) and the sale of 543,615 flow-through units (the “Flow-Through Units” which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at $0.49 (CDN$0.52) per Flow-Through Unit (the “Flow-Through Unit Issue Price”) for gross proceeds of $262,884 (CDN$282,680). The proceeds raised were allocated between the offering of shares and the sale of tax benefits A liability of $35,381 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor. Each Unit consisted of one non-flow through common share (“Common Share”) and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consisted of one flow-through common share and one half of one Common Share purchase warrant (each whole warrant, an “FT Warrant”). Each FT Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. The Company paid Northern a commission equal to 8% of the aggregate gross proceeds which amounted to $85,199 (CDN$91,614) and issued 153,333 “Unit Compensation Warrants” and 43,489 “FT Unit Compensation Warrants”. Each Unit Compensation Warrant is exercisable into one Unit at the Unit Issue Price until August 16, 2009. Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one FT Warrant at the Flow-Through Unit Issue Price until August 16, 2009. Yukon Gold also granted Northern an option (the “Over-Allotment Option”) exercisable until October 15, 2007 to offer for sale up to an additional $468,691 (CDN$500,000) of Units and/or Flow-Through Units on the same terms and conditions. The Company paid a $70,304 (CDN$75,000) due diligence fee to Northern at closing. The Company reimbursed Northern expenses of $18,600 (CDN$20,000) and legal fees of $18,600 (CDN$20,000).
F-21
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
c) Changes to Issued Share Capital-cont'd
On November 16, 2007 the Company completed the second part of a private placement (the “Second Financing”) with Northern acting as agent. The Second Financing was comprised of the sale of 2,438,888 units (the “Units”) at $0.46 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $1,127,028 (CDN$1,097,500) and the sale of 1,071,770 flow through units (the “Flow-Through Units”) at $0.53 (CDN$0.52) per Flow-Through Unit (the “Flow-Through Unit Issue Price”) for gross proceeds of $572,315 (CDN$557,320). The proceeds raised were allocated between the offering of shares and the sale of tax benefits. A liability of $77,043 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor. The closing represented the final tranche of a $2,816,673 (CDN$2.8 million) private placement with Northern announced on July 24, 2007. Each Unit consists of one non-flow through common share (“Common Share”) and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consists of one flow-through common share and one half of one Common Share purchase warrant (each whole warrant, an “FT Warrant”). Each FT Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. Yukon Gold paid Northern a commission equal to 8% of the aggregate gross proceeds and issued 195,111 “Unit Compensation Warrants” and 85,741 “FT Unit Compensation Warrants”. Each Unit Compensation Warrant is exercisable into one Common Share and one half of one Common Share purchase warrant at the Unit Issue Price until November 16, 2009. Each full Common share purchase warrant is exercisable at $0.60 (CDN$0.60) . Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one Common Share purchase warrant at the Flow-Through Unit Issue Price. Each full Common Share purchase warrant is exercisable at $0.70 (CDN$0.70) .
The foregoing private placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act of 1933, as amended.
d) Purchase Warrants
During the year 2006-2007three months ended March 31, 2021 there were the following stock warrants were issued:equity transactions:
400,000 stock warrants were issued on October 3, 2006. The warrants have a two-year term and are exercisable at $1.50 per share in the first twelve months of the term and $2.00 per share in the remaining twelve months of the term. On November 27, 2007 the board of directors extended the expiry date of the warrants to October 4, 2009.
550,000 stock warrants were issued on October 3, 2006. The warrants have a two-year term and are exercisable at $1.50 per share in the the first twelve months of the term and at $2.00 per share in the remaining twelve months of the term. On November 27, 2007, the board of directors extended the expiry date of the warrants to October 4, 2009.
F-22
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
d) Purchase Warrants-cont'd
334,218 stock warrants and an additional 33,423 stock warrants as a penalty were issued on April 25, 2007, relating to the private placement of 334,218 unit special warrants on December 28, 2006 (refer to note 10 above). The penalty warrants were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). Each common share purchase warrant entitles the holder to acquire one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date
32,900 unit compensation warrants were issued on April 25, 2007 relating to the Private Placement of December 28, 2006 (refer to note 10 above). Each unit compensation warrant is exercisable for a period of 24 months from the closing date of December 28, 2006 at $0.81 (CDN$0.941) into one common share and one common share purchase warrant of the Company which is further exercisable at a price of $0.90 (CDN$1.05) for a period of 24 months from the date of exercise.
23,395 unit compensation warrants and an additional 2,340 unit compensation warrants as a penalty were issued on April 25, 2007 relating to the Private Placement of December 28, 2006 (refer to note 10 above). Each unit compensation warrant is exercisable for a period of 24 months from the closing date of December 28, 2006 at $0.81 (CDN$0.941) into one common share and one common share purchase warrant of the Company which is further exercisable at a price of $0.90 (CDN$1.05) for a period of 24 months from the date of exercise.
169,042 flow-through compensation warrants and an additional 16,905 flow-through compensation warrants as a penalty were issued on April 25, 2007 relating to the Private Placement of December 28, 2006 (refer to note 10 above). Each flow-through compensation warrant is exercisable for a period of 24 months from the closing date of December 28, 2006 at a price of $0.90 (CDN$1.05) ..
28,571 flow-through compensation warrants and an additional 2,858 flow-through compensation warrants as a penalty were issued on April 25, 2007 relating to the Private Placement of December 28, 2006 (refer to note 10 above). Each flow-through compensation warrant is exercisable for a period of 24 months from the closing date of December 28, 2006 at a price of $0.90 (CDN$1.05) ..
During the year 2007-2008 the following stock warrants were issued:
On August 16, 2007 the Company completed a private placement financing. The Financing was comprised of the sale of 1,916,666 units and the sale of 543,615 flow-through units. Each Unit consisted of one non-flow through common share and one half of one Common Share purchase warrant. Each Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consisted of one flow-through common share and one-half of one Common Share purchase warrant. Each FT Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. The Company issued 153,333 “Unit Compensation Warrants” and 43,489 “FT Unit Compensation Warrants” to the agent. Each Unit Compensation Warrant is exercisable into one Unit at the Unit Issue Price until August 16, 2009. Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one FT Warrant at the Flow-Through Unit Issue Price until August 16, 2009.
On November 16, 2007 the Company completed the second part of a private placement financing. The Second Financing was comprised of the sale of 2,438,888 units and the sale of 1,071,770 flow-through units. Each Unit consists of one non-flow through common share and one-half of one Common Share purchase warrant. Each Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consists of one flow-through common share and one half of one Common Share purchase warrant. Each FT Warrant is exercisable into one Common Share until November 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. The Company issued 195,111“Unit Compensation Warrants” and 85,741 “FT Unit Compensation Warrants”.
F-23
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
d) Purchase Warrants-cont'd
Each Unit Compensation Warrant is exercisable into one Common Share and one half of one Common Share purchase warrant at the Unit Issue Price until November 16, 2009. Each full Common share purchase warrant is exercisable at $0.60 (CDN$0.60) . Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one Common Share purchase warrant at the Flow-Through Unit Issue Price. Each full Common Share purchase warrant is exercisable at $0.70 (CDN$0.70) .
On December 15, 2007 warrants were issued to the newly appointed President and CEO to purchase 500,000 common shares at a price of $0.24 (CDN$0.24) . 250,000 warrants vested immediately commencing on December 15, 2007 and the balance 250,000 warrants shall vest after six months on June 15, 2008. The warrants granted had a term of 5 years commencing the date of vesting. The fair value of the warrants were calculated using the Black-Scholes method of valuation, using 5% risk free rate and volatility factor of 96.21% . The Company expensed compensation cost for issue of warrants for $123,079 during the year ended April 30, 2008 and carried forward $17,813 being the unexpended compensation cost deferred over the vesting period. Subsequent to April 30, 2008 on June 15, 2008 the balance 250,000 vested.
On November 27, 2007 the board of directors approved the extension of the expiry dates of the following warrants by one (1) year: (a) 2,665,669 warrants expiring on March 28, 2008 exercisable at $0.90 per warrant to March 28, 2009 (b) 950,000 warrants expiring on October 4, 2008 which are exercisable at $2.00 per warrant to October 4, 2009 and (c) 533,133 Broker warrants expiring on March 28, 2008 exercisable at $0.60 per unit to March 28, 2009.
Number of | |||||||||
Warrants | Exercise | ||||||||
Granted | Prices | Expiry Date | |||||||
$ | |||||||||
Outstanding at April 30, 2006 and average exercise price | 4,655,270 | 0.88 | |||||||
Granted in year 2006-2007 | 950,000 | 2.00 | October 4, 2009 | ||||||
Granted in year 2006-2007 | 367,641 | 0.90 | December 28, 2008 | ||||||
Granted in year 2006-2007 | 276,011 | 0.81 | December 28, 2008 | ||||||
Exercised in year 2006-2007 | (306,773 | ) | (0.89 | ) | |||||
Exercised in year 2006-2007 | (107,787 | ) | (0.90 | ) | |||||
Exercised in year 2006-2007 | (61,171 | ) | (0.88 | ) | |||||
Expired in year 2006-2007 | (171,168 | ) | (1.25 | ) | |||||
Expired in year 2006-2007 | (186,320 | ) | (1.00 | ) | |||||
Cancelled | - | ||||||||
Outstanding at April 30, 2007 and average exercise price | 5,415,703 | $ | 0. 97 | ||||||
Granted in year 2007-2008 | 1,111,665 | 0.60 | August 16, 2009 | ||||||
Granted in year 2007-2008 | 315,296 | 0.70 | August 16, 2009 | ||||||
Granted in year 2007-2008 | 1,414,554 | 0.60 | November 16, 2009 | ||||||
Granted in year 2007-2008 | 621,626 | 0.70 | November 16, 2009 |
F-24
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
10. CAPITAL STOCK-CONT'D
d) Purchase Warrants-cont'd
Granted in year 2007-2008 | 250,000 | 0.24 | December 15, 2012 | ||||||
Granted in year 2007-2008 | 250,000 | 0.24 | June 15, 2013 | ||||||
Exercised in year 2007-2008 | - | - | |||||||
Expired in year 2007-2008 | (377,794 | ) | (1.00) | ||||||
Cancelled in year 2007-2008 | - | - | |||||||
Outstanding at April 30, 2008 and average exercise price | 9,001,050 | 0.86 |
The warrants do not confer upon the holders any rights or interest as a shareholder of the Company.
On November 27, 2007 the board of directors approved the extension of the expiry dates of the following warrants by one (1) year: (a) 2,665,669 warrants expiring on March 28, 2008 exercisable at $0.90 per warrant to March 28, 2009, having a fair value of $76,483; (b) 950,000 warrants expiring on October 4, 2008 which are exercisable at $2.00 per warrant to October 4, 2009, having a fair market value of $5,144; and (c) 533,133 Broker warrants expiring on March 28, 2008 exercisable at $0.60 per unit to March 28, 2009 having a fair market value of $28,645.
11. SUBSCRIPTION FOR WARRANTS
Year 2006-2007
| 20,503,600 shares to | |
● | 36 shares as a rounding/true-up issuance to an outside investor. |
During the year ended December 31, 2020 there were the following equity transactions:
| 91,127,145 shares issued to the | |
● | 12,495,700 shares issued to the Company’s consultants; | |
| 55,612,837 shares | |
● | 35,109,231 shares issued to |
F-25
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008Note 4 – Commitments and April 30, 2007(Amounts expressed in US Dollars)Contingencies
11. SUBSCRIPTION FOR WARRANTS-CONT'D
The term “Flow-Through Shares”Company has no commitments or contingencies.
Note 5 – Related Party Transactions
VitaNova Partners, which owns approximately 22.5% of VETANOVA, is significant for tax purposes in Canada because it enablesproviding management, including financial oversight, of VETANOVA. As of March 31, 2021, the issuer to allocate certain exploration tax credit toCompany owed VitaNova Partners $ 83,995. As of December 31, 2020 VitaNova Partners owed the holders of such shares. As all Canadian Exploration expenses are incurred by the Company’s 100% owned Canadian subsidiary, which conducts mining explorations in the Yukon Territory of Canada, for Canadian tax purposes, a similar Flow-Through subscription agreement was executed betweenCompany $65,179.
On July 15, 2020, the Company and its 100% Canadian subsidiary. The effective date of renunciation for Canadian Exploration expenses was December 31, 2006, which as per Canadian tax regulations requiresVitaNova entered into a consulting agreement whereby VitaNova would provide management services until the Canadian subsidiary to incur eligible Canadian exploration expenses for the entire subscription amount of $2,543,505 (CDN$2,964,201) on or before December 31, 2007. The Company has renounced such eligible expenses to the Canadian accredited investors. Proceeds received from such warrants were allocated by the Company between thecurrent private placement offering for sharesis completed and the sale of tax benefits. The amount of $366,996 attributable to the sale of taxable benefits was credited to Other Liabilities. On renunciation of eligible exploration expenses in January of 2007, this Liability was reversed and included in income under Income tax recovery.
|
Year 2007-2008
There were no subscriptions for warrants during the period May 1, 2007 to April 30, 2008.
12. STOCK BASED COMPENSATION
Per SEC Staff Accounting Bulletin 107, Topic 14.F, “Classification of Compensation Expense Associated with Share-Based Payment Arrangements” stock based compensation expense is being presented in the same lines as cash compensation paid.
The Company adopted a new Stock Option Plan at its shareholders meeting on January 19, 2007 (the “2006 Stock Option Plan”). The 2006 Stock Option Plan will be administered by the board of directors of the Company or, in the board of directors’ discretion, by a committee appointed by the board of directors for that purpose. The TSX approved the 2006 Stock Option plan on March 9, 2007.
Subject to the provisions of the 2006 Stock Option Plan, the aggregate number of shares which may be issued under the 2006 Stock Option Plan shall not exceed 2,000,000 shares ("Total Shares"). On March 18, 2008 at the Annual and Special Meeting of Shareholders, the Shareholders of the Company approved an amendment to the 2006 Stock Option Plan increasing the number of Shares reserved for issuance there under from 2,000,000 to 2,899,044. Any Stock Option granted under the 2006 Stock Option Plan which has been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan, effectively resulting in a re-loading of the number of shares available for grant under the 2006 Stock Option Plan. Any shares subject to an option granted under the 2006 Stock Option Plan which for any reason is surrendered, cancelled or terminated or expires without having been exercised shall again be available for subsequent grant under the 2006 Stock Option Plan.
Under the 2006 Stock Option Plan, at no time shall: (i) the number of shares reserved for issuance pursuant to Stock Options granted to any one optionee exceed 10% of the Total Shares; (ii) the number of shares, together with all security based compensation arrangements of the Company in effect, reserved for issuance pursuant to Stock Options granted to any "insiders" (as that term is defined under theSecurities Act (Ontario)) exceed 10% of the total number of issued and outstanding shares. In addition, the number of shares issued to insiders pursuant to the exercise of Stock Options, within any one year period, together with all security based compensation arrangements of the Company in effect, shall not exceed 10% of the total number of issued and outstanding shares.
F-26
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
12. STOCK BASED COMPENSATION-CONT'D
The purchase price (the “Price”) per share under each Stock Option shall be determined by the board of directors or a committee, as applicable. The Price shall not be lower than the closing market price on the TSX, or another stock exchange where the majority of the trading volume and value of the Shares occurs, on the trading day immediately preceding the date of grant, or if not so traded, the average between the closing bid and asked prices thereof as reported for the trading day immediately preceding the date of the grant; provided that if the shares have not traded on the TSX or another stock exchange for an extended period of time, the “market price” will be the fair market value of the shares at the time of grant, as determined by the board of directors or committee. The board of directors or committee may determine that the Price may escalate at a specified rate dependent upon the date on which an option may be exercised by the Eligible Participant.
Options shall not be granted for a term exceeding tenyears (or such shorter or longer period as is permitted by the TSX) (the “Option Period”).
Year 2006-2007.
On January 19, 2007, the shareholders of the Company approved, subject to regulatory approval, the extension of 2,064,000 options held by all current officers, directors, consultants and employees in the 2003 Stock Option Plan and the adding ofcan properly elect an additional 2,000,000 common shares of stock to the 2006 Stock Option Plan. The TSX approved the 2006 Stock Option plan on March 9, 2007.
On March 20, 2007 theindependent board of directors granted optionsand appoint Company officers. VitaNova is paid $456,000 annually for its management services. Payments are made in 12 monthly installments of $38,000. On December 15, 2020 the consulting agreement was amended to an officer and directorreduce payments to acquire 250,000 shares, to vest at the rate of 1/24 per$19,000 a month and can be exercised over a period of five (5) years. The exercise price was set at $0.43 (CDN$0.50) per share. These options were granted under the Company’s 2006 stock option plan. These options were cancelled on March 13, 2008.effective January 1, 2021.
On March 28, 2007 the board of directors granted options to a consultant to acquire 150,000 shares, to vest at the rate of 1/12 per month and can be exercised over a period of five (5) years. The exercise price was set at $0.41 (CDN$0.47) per share. These options were granted under the Company’s 2006 stock option plan. On March 13, 2008 these options were cancelled.
Year 2007-2008.
During the year ended April 30, 2008,December 31, 2020 there were the following stock optionsequity transactions involving related parties:
● | 100,622,845 shares issued to the Company’s founders, officers and board members, and | |
● | 55,612,837 shares issued to VitaNova Partners, LLC. |
Note 6 – Subsequent Events
RM Materials, LLC was issued 61,511,800 the Company’s common units, of which 41,007,200 VTNA common units were granted under the 2006 stock option plan:
a) On August 15, 2007 Stock optionsissued on April 5, 2021 and are subject to one consultant to purchase 125,000 common shares each at an exercise price of $0.42 (CND $0.45) per share. These options were granted in accordance with the terms of the Company's 2006 Stock Option Plan and shall vest at 31,250 options each on November 15, 2007, February 15, 2008, May 15, 2008 and August 15, 2008 respectively. The first exercise date of the option is August 15, 2008 and these options shall expire on August 15, 2010. The Company terminated the contract with this consultant effective February 15, 2008.
b) On September 28, 2007 Stock Options to one officer to purchase 200,000 common shares atrepurchase by VitaNova Solar Partners, LLC for a price of $0.38 (CDN$0.38) and$0.0001 per VTNA common units. Of the 41,007,400 VTNA common units Common Units subject to one employee to purchase 100,000 common shares atrepurchase, 20,503,600 VTNA Common Units will be released from repurchase if a price of $0.39 (CDN$0.39) per share. These options were granted in accordance with the terms of the Company's 2006 Stock Option Plan. Options to the officer shall vest at the rate of one twelfth (1/12) each month, commencing, on the 1st day of October 2007, for a period of twelve months. The options granted shall be for a term of 5 years. Options to the employee shall vest at the rate of one twenty-forth (1/24) each month, commencing on October 28, 2007, for a period of 24 months. The options granted shall be for a term of 5 years. Subsequent to the year ended April 30, 2008 the 200,000 options granted to one officer were cancelled on June 11, 2008.
F-27
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
12. STOCK BASED COMPENSATION-CONT'D
c) On December 18, 2007 Stock Options to one officer to purchase 200,000 common shares at a price of $0.24 (CDN$0.24) .. These options were granted in accordance with the terms of the Company's 2006 Stock Option Plan. The options granted were fully vested upon issuance and have a term of 5 years.
d) On January 14, 2008 Stock Options to two directors to purchase 200,000 common shares each at a price of $0.31 (CDN$0.31), to two directors to purchase 100,000 common shares each at a price of $0.31 (CDN$0.31), to two officers to purchase 75,000 common shares each at a price of $0.31 (CDN$0.31) and to one employee to purchase 75,000 common shares at a price of $0.31 (CDN$0.31), for a total of 825,000 options. These options were granted in accordance with the terms of the Company's 2006 Stock Option Plan. The options granted were fully vested upon issuance and have a term of 5 years.
e) On February 21, 2008 the Company issued stock options under it's 2006 Stock Option Plan to a director to purchase 150,000 common shares at a price of $0.28 (CDN$0.28) . All of the options vested immediately. The options granted were fully vested upon issuance and have a term of 5 years.
f) On March 25, 2008 the Company issued stock options under it's 2006 Stock Option Plan to an officer to purchase 200,000 common shares at a price of $0.22 (CDN$0.22) . All of the options vested immediately. The options granted were fully vested upon issuance and have a term of 5 years.
g) On April 8, 2008 the Company issued stock options under it's 2006 Stock Option Plan to two directors to purchase 50,000 common shares each at a price of $0.20 (CDN$0.20) . All of the options vested immediately. The options granted were fully vested upon issuance and have a term of 5 years.
Cancellation/Expiration of Stock Options
On February 12, 2008 the Company issued notice of termination of the contract with one consultant effective as of February 15, 2008. The 31,250 options granted under the contract to vest on each of May 15, 2008 and August 15, 2008 respectively were cancelled.
On March 13, 2008 the 248,000 stock options from the 2003 Stock Option Plan and the 250,000 stock options from the 2006 Stock Option Plan, granted to one former officer and director were cancelled.
On March 13, 2008 the 150,000 stock options from the 2006 Stock Option Plan granted to one former consultant were cancelled.
On April 15, 2008 20,000 stock options from the 2003 Stock Option Plan granted to one former consultant expired.
For this year ended April 30, 2008, the Company has recognized in the financial statements, stock-based compensation costs as per the following details. The fair value of each option used for the purpose of estimating the stock compensation is based on the grant date using the Black-Scholes option pricing model with the following weighted average assumptions:
F-28
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
12. STOCK BASED COMPENSATION-CONT'D
19-Jan | 20-Mar | 28-Mar | 15-Aug | 28-Sept | 18-Dec | 14-Jan | 21-Feb | 25-Mar | Apr 8- | ||||||||||||||||||||||||
2007 | 2007 | 2007 | 2007 | 2007 | 2007 | 2008 | 2008 | 2008 | 2008 | TOTAL | |||||||||||||||||||||||
Risk free rate | 4.5% | 4.5% | 4.5% | 5% | 4.5% | 5.0% | 5.0% | 5.0% | 5.0% | 5.0% | |||||||||||||||||||||||
Volatility factor | 45.19% | 57.48% | 98.67% | 91.68% | 92.20% | 101.61% | 95.77% | 94.49% | 94.92% | 94.92% | |||||||||||||||||||||||
Stock-based | |||||||||||||||||||||||||||||||||
compensation | |||||||||||||||||||||||||||||||||
cost expensed | |||||||||||||||||||||||||||||||||
during the year | |||||||||||||||||||||||||||||||||
ended April 30, | |||||||||||||||||||||||||||||||||
2008 | $ | 167,515 | $ | 22,973 | $ | 41,314 | $ | 14,850 | $ | 45,760 | $ | 31,738 | $ | 183,724 | $ | 27,194 | $ | 34,444 | $ | 14,816 | $ | 584,328 | |||||||||||
Unexpended Stock | |||||||||||||||||||||||||||||||||
based | |||||||||||||||||||||||||||||||||
compensation | |||||||||||||||||||||||||||||||||
cost deferred | |||||||||||||||||||||||||||||||||
over the vesting | |||||||||||||||||||||||||||||||||
period | - | - | - | - | $ | 26,454 | - | - | - | - | - | $ | 26,454 |
As of April 30, 2008 there was $26,454 of unrecognized expenses related to non-vested stock-based compensation arrangements granted. The stock-based compensation expense for the years ended April 30, 2008 and April 30, 2007 was $584,328 and $451,273 respectively.
The following table summarizes the options outstanding as at April 30:
Option Price | Number of shares | |||||||||
Expiry Date | Per Share | 2008 | 2007 | |||||||
15-Dec-09 | $ | 0.75 | 250,000 | 250,000 | ||||||
5-Jan-10 | $ | 0.75 | 12,000 | 60,000 | ||||||
28-Jun-10 | $ | 0.55 | 490,000 | 490,000 | ||||||
15-Apr-08 | $ | 0.58 | - | 20,000 | ||||||
15-Aug-10 | $ | 0.45 | 62500 | |||||||
13-Dec-10 | $ | 1.19 | 576,000 | 1,026,000 | ||||||
13-Dec-10 | $ | 1.19 | 88,000 | 88,000 | ||||||
20-Jan-11 | $ | 0.85 | 150,000 | 150,000 | ||||||
20-Mar-12 | $ | 0.43 | - | 250,000 | ||||||
28-Mar-12 | $ | 0.41 | - | 150,000 | ||||||
28-Sep-12 | $ | 0.38 | 200,000 | |||||||
28-Sep-12 | $ | 0.39 | 100,000 | |||||||
18-Dec-12 | $ | 0.24 | 200,000 |
F-29
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
12. STOCK BASED COMPENSATION-CONT'D
14-Jan-13 | $ | 0.31 | 825,000 | ||||||
21-Feb-13 | $ | 0.28 | 150,000 | ||||||
25-Mar-13 | $ | 0.22 | 200,000 | ||||||
8-Apr-13 | $ | 0.20 | 100,000 | ||||||
| 3,403,500 | 2,484,000 | |||||||
Weighted average exercise price at end of year | 0.57 | 0.89 |
Number of Shares | ||||||
2007-2008 | 2006-2007 | |||||
Outstanding, beginning of year | 2,484,000 | 2,958,000 | ||||
Granted | 1,900,000 | 400,000 | ||||
Expired | (20,000 | ) | (800,000 | |||
Exercised | - | (74,000 | ) | |||
Forfeited | (960,500 | ) | ||||
Cancelled | ||||||
Outstanding, end of year | 3,403,500 | 2,484,000 | ||||
Exercisable, end of year | 3,249,334 | 1,625,786 |
The Company subsequently forfeited 200,000 options on June 11, 2008 due to the resignation of an officer of the Company.
13. RESTRICTED CASH
Under Canadian income tax regulations, a company is permitted to issue flow-through shares whereby the company agrees to incur qualifying expenditures and renounce the related income tax deductions to the investors. Notwithstanding that, there is no specific requirement to segregate the funds. The flow-through funds which are unexpended at the consolidated balance sheet date are considered to be restricted and are not considered to be cash or cash equivalents. As of April 30, 2008, unexpended flow-through funds were $817,092 (CDN $822,975).
14. SHORT-TERM INVESTMENT IN AVAILABLE- FOR- SALE SECURITIES
The Company entered into a subscription agreement dated as of April 3, 2007 (the “Agreement”) with Industrial Minerals, Inc. (“Industrial Minerals”) to acquire (i) 5,000,000 common shares of Industrial Minerals at a price of $0.05 per share and (ii) a Warrant entitling the holder: (a) to purchase 5,000,000 common shares of Industrial Minerals at a purchase price of $0.05 per share (the “option price”) or, at the option of the holder, (b) to surrender the Warrant for a number of common shares to be determined by application of an anti-dilution formula which would result in a larger number of shares issued to the holder if the market price of the common stock is less than the option price at the time of exercise. The Warrant expired on April 3, 2008. The total subscription price paid by the Company was $250,000. The Company entered into the Agreement as of May 14, 2007. The common stock of Industrial Minerals is quoted on the Over-the-Counter Bulletin Board under the symbol, “IDSM.” The Company accounted for this investment as a short term investment in available-for-sale securities. On August 17, 2007, the Company entered into an agreement with Global Capital SPE-1 LLC (“Global”) pursuant to which Global agreed to purchase 2 million shares of Industrial Minerals Inc. (“IDSM”) held by the Company for consideration of $140,000. Pursuant to the Agreement, Global had the option to purchase from the Company an additional 3 million shares of IDSM for consideration of $210,000. The Company also assigned to Global 5 million warrants to purchase IDSM stock. The Company will receive up to $100,000 in the event that Global exercises all or a portion of the warrants. Global consummated the purchase of the first 2 million shares of IDSM on September 6, 2007 and another 1,000,000 shares on January 30, 2008 and paid the Company a total of $210,000. The Company accounted for $60,000 as realized gain on sale of securities to Global as a credit to the general and administrative expenses and reduced the unrealized gain of $100,000 to $40,000. During the periods of March and April 08, the Company sold an additional 1,550,000 common shares in the open market for a total consideration of $130,040. The Company accounted for $52,540 as realized gain on sale of securities in the open market as a credit to the general and administrative expense and reduced the unrealized gain further by $31,000 to $9,000.
F-30
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
14. SHORT-TERM INVESTMENT IN AVAILABLE- FOR- SALE SECURITIES-CONT'D
Subsequent to the year ended April 30, 2008 the Company sold the balance of 450,000 shares of Industrial Minerals, Inc. at an average selling price of $.0655 for a total consideration of $29,460 in the open market.
15. OTHER LIABILITY
Year ended April 30, 2007
On December 28, 2006, the Company completed a brokeredcontemplated $3,000,000 VTNA private placement is completed by December 31, 2021; and 20,503,600 VTNA Common Units will be released from repurchase if, prior to December 31, 2022, VTNA completes a “sale lease back” of 2,823,049 flow-through special warrants (which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) Proceeds receiveda solar powered property from such warrants were allocated by the Company between the offering for shares and the sale of tax benefits. The amount of $366,996 attributable to the sale of taxable benefits was credited to Other Liabilities. On renunciation of eligible exploration expenses in January of 2007, this Liability was reversed and included in income under Income tax recovery.
Year ended April 30, 2008
On August 16, 2007 the Company completed a brokered private placement through the issuance of 543,615 flow-through units at a price of $0.49 (CDN$0.52) per Flow-Through Unit forwhich VTNA receives gross proceeds of $262,884 (CDN$282,680). The proceeds raised were allocated between the offering of shares and the sale of tax benefits. A liability of $35,381 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor in January 2008.a least $6,000,000.
On November 16, 2007 the Company completed a brokered private placement through the issuance of 1,071,770 flow-through units at a price of $0.53 (CDN$0.52) per Flow-Through Unit for gross proceeds of $572,315 (CDN$557,320). The proceeds raised were allocated between the offering of shares and the sale of tax benefits. A liability of $77,043 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor in January 2008.
16. COMMITMENTS AND CONTINGENCIES
a) Mount Hinton Property Mining Claims
On July 7, 2002 Yukon Gold Corp. (“YGC”) entered into an option agreement with the Hinton Syndicate to acquire a 75% interest in the 273 unpatented mineral claims covering approximately 14,000 acres in the Mayo Mining District of Yukon, Canada. This agreement was replaced with a revised and amended agreement (the “Hinton Option Agreement”) dated July 7, 2005 which superseded the original agreement and amendments thereto. The new agreement is between the Company, its wholly-owned subsidiary YGC and the Hinton Syndicate.
F-31
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
a) Mount Hinton Property Mining Claims- cont'd
YGC must make scheduled cash payments and perform certain work commitments to earn up to a 75% interest in the mineral claims, subject to a 2% net smelter return royalty in favor of the Hinton Syndicate, as further described below.
The schedule of Property Payments and Work Programs are as follows:
PROPERTY PAYMENTS
F-19 |
WORK PROGRAM-expenditures to be incurred in the following periods;
By letter agreement dated August 17, 2006, the Hinton Syndicate agreed to allow the Company to defer a portion of the Work Program expenditure scheduled to be incurred by December 31, 2006. The agreement to defer such Work program expenditures was due to the mechanical break-down of drilling equipment and the unavailability of replacement drilling equipment at the Mount Hinton site. As a result, the Company was allowed to defer the expenditure of approximately $220,681 (CDN$235,423) until December 31, 2007. The Company had incurred that expenditure in addition to the expenditure for January 1 to December 31, 2007 as at October 31, 2007. AllPROSPECTUS
VETANOVA, INC.
COMMON STOCK AND WARRANTS
No dealer, salesperson or other Property Payments and Work Program expenditures due have been made and incurred.
**By letter agreement dated February 29, 2008, the Company gave notice to the Hinton Syndicate that all of the Work Program expenditures scheduled to be incurred by December 31, 2008 would be deferred until December 31, 2009. Subsection 2.2(f) of the Hinton Option Agreement provides that if Yukon Gold has earned at least 25% of the right, title and interest in the Property as provided for in Subsection 2.2(e) of the Hinton Option Agreement and is unable to meet its next year's Work Program expenditures as set out in Section 2.2 of the Hinton Option Agreement, it shall be entitled to extend the time required to incur the Work Program expenditures from year to year by giving notice to the Hinton Syndicate to such effect; provided that the full amount of the Work Program expendituresperson has been incurredauthorized to give any information or to make any representation not contained in this prospectus, and if given or made, such information or representations must not be relied upon as having been authorized by December 31, 2009.
F-32
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
a) Mount Hinton Property Mining Claims- cont'd
Provided all Property Payments have been made that are due prior to the Work Program expenditure levels being attained, YGC shall have earned a:
25% interest upon completion of Work Program expenditures of $1,587,806 (CDN$1,500,000)
50% interest upon completion of Work Program expenditures of $2,646,343 (CDN$2,500,000)
75% interest upon completion of Work Program expenditures of $4,906,610 (CDN$5,225,000)
YGC earned a 50% interest in the claims covered by the Hinton Option Agreement as at October 31, 2007. In some cases, payments made to service providers include amounts advanced to cover the cost of future work. These advances areus. This prospectus does not loans but are considered “incurred” exploration expenses under the terms of the Hinton Option Agreement. Section 2.2(a) of the Hinton Option Agreement defines the term, “incurred” as follows: “Costs shall be deemed to have been “incurred” when YGC has contractually obligated itself to pay for such costs or such costs have been paid, whichever should first occur.” Consequently, the term, “incurred” includes amounts actually paid and amounts that YGC has obligated itself to pay.
The Hinton Option Agreement contemplates that upon the earlier of: (i) a production decision or (ii) investment of $4,906,610 (CDN$5,225,000) or (iii) YGC has a minority interest and decides not to spend any more money on the project, YGC's relationship with the Hinton Syndicate will become a joint venture for the further development of the property. Under the terms of the Hinton Option Agreement, the party with the majority interest would control the joint venture. Although YGC had earned a 50% interest as at October 31, 2007, if the relationship is converted to a joint venture currently, YGC's interest would automatically be reduced to a 45% interest in the joint venture (by the terms of the Hinton Option Agreement) and the Hinton Syndicate would control the joint venture. Once the 75% interest is earned, as described above, YGC has a further option to acquire the remaining 25% interest in the mineral claims for a further payment of $4,964,257 (CDN$5,000,000).
The Hinton Option Agreement provides that the Hinton Syndicate receives a 2% “net smelter return royalty.” In the event that the Company exercises its option to buy-out the remaining 25% interest of the Hinton Syndicate (which is only possible if the Company has reached a 75% interest, as described above) then the “net smelter return royalty” would become 3% and the Hinton Syndicate would retain this royalty interest only. The “net smelter return royalty” is a percentage of the gross revenue received from the sale of the ore produced from the mine less certain permitted expenses.
The Hinton Option Agreement entitles the Hinton Syndicate to recommend for appointment one member to the board of directors of the Company.
The Hinton Option Agreement provides both parties (YGC and the Hinton Syndicate) with rights of first refusal in the event that either party desiresconstitute an offer to sell, or transfer its interest.
The Hinton Syndicate members each have the optiona solicitation of an offer to receive their sharebuy, any of property paymentsour securities in stock of the Company at a 10% discountany jurisdiction to the market. YGC and the Company have a further optionany person to pay 40% of any property payment due after the payment on January 2, 2006 with common stock of the Company. On July 7, 2007 the Company issued 136,364 common shares, with the approval of the TSX, in settlement of 40% of the property payment due on July 7, 2007. The shares represent $57,252 (CDN$60,000) whichwhom it is 40% of the contracted payment and were valued at $0.42 (CDN$0.44) each. The $84,727 (CDN$90,000) balance was paid in cash to the members of the Hinton Syndicate on July 7, 2007. This entire issuance of shares and cash payment was expensed as project expense. Subsequent to April 30, 2008 on July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.126 (CDN$0.126) each. The balance of the property payment in the amount of $89,357(CDN$90,000) was paid in cash.
F-33
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
a) Mount Hinton Property Mining Claims- cont'd
The Hinton Option Agreement pertains to an “area of interest” which includes the area within ten kilometres of the outermost boundaries of the 273 mineral claims, which constitute our mineral properties. Either party to the Hinton Option Agreement may stake claims outside the 273 mineral claims, but each must notify the other party if such new claims are within the “area of interest.” The non-staking party may then elect to have the new claims included within the Hinton Option Agreement. As of December 11, 2006, there were an additional 24 claims staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement. Subsequent to April 30, 2008 there were an additional 18 claims staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement.
On April 2, 2007 the Company accepted a proposed work program, budget and cash call schedule for the Mount Hinton project which was revised on May 15, 2007. The Company paid cash calls in the amount of $2,152,317 (CDN$2,105,200) for the 2007 Work Program. The Company had approximately $70,304 (CDN$75,000) on deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company paid $180,164 (CDN$200,000), on June 15, 2007 the Company paid $202,684 (CDN$225,000), being two of the four cash call payments. Due to delays in the drilling program the third payment of $635,123 (CDN$600,000), which was due on July 31, 2007 was changed to August 31, 2007. On August 15, 2007 the Company paid $97,259 (CDN$91,880) towards the third cash call payment for the Mount Hinton 2007 Work Program. On August 31, 2007 the Company re-allocated $537,864 (CDN$508,120) being the balance of the third cash call payment from cash call funds previously allocated to the Marg Project. These re-allocated funds were not needed for the Marg Project. The fourth payment of $428,919 (CDN$405,200) which was originally due on August 15, 2007 was changed to and paid on September 15, 2007.
b) The Marg Property
In March 2005, the Company acquired rights to purchase 100% of the Marg Property, which consists of 402 contiguous mineral claims covering approximately 20,000 acres located in the Mayo Mining District of the Yukon Territory of Canada. Title to the claims is registered in the name of YGC.
The Company assumed the rights to acquire the Marg Property under a Property Purchase Agreement (“Agreement”) with Atna Resources Ltd. (“Atna”). Under the terms of the Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333 common shares as a down payment. The Company made payments under the Agreement for $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the Company on December 12, 2005; $86,805 (CDN$100,000) cash and an additional 133,334 common shares of the Company on December 12, 2006. On December 12, 2007 the Company paid $98,697 (CDN$100,000) being the next payment due.
The Company has agreedunlawful to make subsequent payments under the Agreement of: $199,243 (CDN$200,000) in cash and/or common sharesan offer by means of the Company (or some combination thereof to be determined) on or before December 12, 2008. Upon the commencement of commercial production at the Marg Property, the Company will pay to Atna $996,214 (CDN$1,000,000) in cash and/or common shares of the Company, or some combination thereof to be determined.this prospectus.
F-34
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
b) The Marg Property -cont'd
On April 2, 2007 the Company accepted a proposed work program, budget and cash call schedule for the Marg project. The Company has paid cash calls in the amount of $2,100,528 (CDN$2,281,880) for the 2007 Work Program. The Company had approximately $515,561 (CDN$550,000) on deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037 (CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000) being three of the four cash call payments. The fourth and final payment of $402,244 (CDN$380,000) was paid on August 15, 2007. On August 31, 2007 the Company re-allocated $537,864 (CDN$508,120) being the balance of the third cash call payment for the Mount Hinton 2007 Work Program from cash call funds previously allocated to the Marg Project. These re-allocated funds were not needed for the Marg Project. On January 23, 2008 the Company was refunded $388,524 (CDN$390,000) as these funds were not needed for the Marg Project.
c) On August 15, 2007 the Company entered into an investor relations marketing agreement with a consultant for a one year term, with the option to renew for an additional 12 months. In return for services rendered, the Company will pay the consultant $1,992 (CDN$2,000) per month. On August 31, 2007 the Company paid $3,787 (CDN$4,000) being the first and last payments of the contract. On September 15, 2007 the Company paid $1,941 (CDN$2,000) and on October 15, 2007 the Company paid $2,048 (CDN$2,000), being the second and third payments respectively. On November 15, 2007 the Company paid $2,030 (CDN$2,000) being the fourth payment of the contract. On December 14, 2007 the Company paid $1,967 (CDN$2,000) and on January 15, 2008 the Company paid $1,967 (CDN$2,000), being the fifth and sixth payments of the contract respectively. In addition, the consultant has been granted an option to purchase 125,000 shares of the Company at $0.45 (CDN$0.45) per share, with the option vesting in equal quarterly amounts of 31,250 shares on November 15, 2007, February 15, 2008, May 15, 2008 and August 15, 2008, and the first exercise date being August 15, 2008 and an expiry date of August 15, 2010. Subsequently on February 12, 2008 the Company terminated the contract and the Company received a refund on March 11, 2008 of $1,295(CDN$1,300) previously paid on August 31, 2007 to cover the last payment of the one year term. The 31,250 options granted under the contract to vest on each of May 15, 2008 and August 15, 2008 respectively were also cancelled.
d) On December 5, 2007 the Company entered into an agreement with a consultant to create investor awareness for a period of six months, commencing on December 5, 2007 for a fee of $20,000 and 300,000 restricted common shares to be issued in equal tranches of 50,000 shares at the end of each month during the term of the agreement. On December 6, 2007 the Company received conditional approval from the TSX to issue the 300,000 restricted shares as per the terms of the agreement. The consulting fee of $20,000 was paid on December 11, 2007. The Company had accrued the expense of $22,000 for 100,000 shares to be issued to January 31, 08 . Due to non-performance of the agreement by the consultant, the Company has obtained legal opinion that it is not obligated to issue any of the restricted 300,000 common shares. The consulting expense accrual for $22,000 set up during the quarter ended January 31, 08 was reversed and credited back to income in the last quarter of 2008. The Company has also paid the requisite fee to the TSX for cancellation of all of these shares.
e) Effective as of December 15, 2007 the Company entered into a consulting agreement with Ronald Mann (the “Mann Agreement”), pursuant to which Mr. Mann was retained as the Company's President and Chief Executive Officer. The board of directors of the Company appointed Mr. Mann to fill a vacancy on the board of directors, also effective as of December 15, 2007. The Mann Agreement has a one-year term commencing on December 15, 2007, and is automatically renewable thereafter, unless terminated pursuant to the terms of the Mann Agreement. Mr. Mann and the Company shall indicate their respective intentions to renew the term after the passage of eight (8) months from the date of the Mann Agreement. Pursuant to the Mann Agreement, Mr. Mann will receive an annual consulting fee of $148,928 (CDN$150,000). In addition, Mr. Mann received 500,000 warrants to purchase shares of the Company's common stock (the “Mann Warrants”). The Mann Warrants shall have a term of 5 years and an exercise price of the fair market value of the Company's common stock on their date of issuance. 250,000 of the Mann Warrants were fully vested upon issuance, with the remaining 250,000 vesting 6 months from the date of issuance, on June 15, 2008 subsequent to the year ended April 30, 2008.
F-35
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
f) As of December 18, 2007 the Company entered into a consulting agreement with Cletus Ryan (the “Ryan Agreement”) pursuant to which Mr. Ryan was retained as the Company's Vice President, Corporate Development. The Ryan Agreement has a six-month term commencing on December 18, 2007 and is automatically renewable thereafter, unless terminated pursuant to the terms of the Ryan Agreement.
Pursuant to the Ryan Agreement, Mr. Ryan will receive an annual consulting fee of $119,142 (CDN$120,000). In addition, Mr. Ryan received 200,000 options to purchase shares of the Company's common stock (the “Ryan Options”). The Ryan Options were fully vested upon the date of issuance. On March 7, 2008 the Company renewed the Ryan Agreement for an additional six months.
g) On February 11, 2008 by letter engagement agreement the Company contracted the services of a Corporate Secretarial company to fill the role of Mrs. Lisa Rose during her maternity leave for a monthly fee of $1,340 (CDN$1,350) plus eligible expenses.
h) On February 18, 2008 the Company and YGC, it’s wholly-owned subsidiary, signed a surface drilling contract with a diamond drilling company for the Marg Project to commence on or about June 18, 2008, with an estimated all-in cost of $1,985,703 (CDN$2,000,000). On February 18, 2008 the Company paid $148,928 (CDN$150,000) as a deposit per the terms of the contract.
i) On March 10, 2008 the Company entered into a contract with a global mining consultancy business for a scoping study and to prepare a report pursuant to the terms of Canadian National Instrument 43-101, regarding the Marg Deposit at an estimated cost of $79,428 (CDN$80,000). The Company paid $18,579 (CDN $18,713) at April 30, 2008. Subsequent to the year end, the Company has paid an additional $7,270 (CDN$7,322).
j) On March 18, 2008 the Company entered into a consulting agreement with Gary Cohoon (the “Cohoon Agreement”) pursuant to which Mr. Cohoon was retained as Vice-President, Exploration, of the Company. The Cohoon Agreement has a one-year term commencing on March 18, 2008 and is automatically renewable thereafter, unless terminated pursuant to its terms. Pursuant to the Cohoon Agreement, Mr. Cohoon will receive an annual consulting fee of $139,000 (CDN$140,000). Additionally, Mr. Cohoon received 200,000 options to purchase shares of the Company's common stock (the “Cohoon Options”). The Cohoon Options fully vested upon issuance.
k) On April 10, 2008 by letter agreement the Company procured the services of Galina Morozova through a contract position as a Geologist with YGC, the Company’s wholly-owned subsidiary commencing April 15, 2008 until August 31, 2008. Ms. Morozova will receive $6,454 (CDN$6,500) per month until the project begins at the Marg Property on approximately June 15, 2008, whereupon Ms. Morozova will receive $496 (CDN$500) per day plus expenses for the duration of the term of the letter agreement.
l) On April 29, 2008 the Company entered into a letter agreement with R. Andrew Hureau for a contract position as Senior Geologist with YGC, the Company’s wholly-owned subsidiary. Mr. Hureau’s position commenced on May 1, 2008 at a rate of $745 (CDN$750) per day plus expenses. The letter agreement states that the term is on commencement and for the duration of drilling on the Marg Project, approximately mid June, 2008 to the end of August, 2008, on a regular schedule.
m) The Company entered into a five year operating lease for its Corporate office which was executed on March 27, 2006. The lease commenced July 1, 2006. Minimum lease commitments under the lease are as follows:
F-36
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
16. COMMITMENTS AND CONTINGENCIES-CONT'D
Minimum lease | |||||
Years ending April 30, | commitment | ||||
2009 | $ 47,538 | (CDN $47,880 | ) | ||
2010 | $ 49,384 | (CDN $49,740 | ) | ||
2011 | $ 49,754 | (CDN $50,112 | ) | ||
2012 | $ 8,293 | (CDN $ 8,353 | ) |
17. OBLIGATION UNDER CAPITAL LEASE
The following is a summary of future minimum lease payments under the capital lease, together with the balance of the obligation under the lease:
Years ending April 30, | |||||
2009 | $ | 3,551 | (CDN$ 3,577 | ) | |
2010 | $ | 3,551 | (CDN$ 3,577 | ) | |
2011 | $ | 3,551 | (CDN$ 3,577 | ) | |
2012 | $ | 889 | (CDN$ 894 | ) | |
Total minimum lease payments | $ | 11,542 | (CDN$11,625 | ) | |
Less: Deferred Interest | $ | 1,233 | (CDN$ 1,242 | ) | |
$ | 10,309 | (CDN$10,383 | ) | ||
Current Portion | $ | 3,100 | (CDN$ 3,122 | ) | |
Long-Term Portion | $ | 7,209 | (CDN$7,261 | ) |
18. RELATED PARTY TRANSACTIONS
2006-2007
The Company and its subsidiary expensed a total of $208,855 in consulting fees to three Company Directors, and $94,504 to two of its officers.
The Company issued 141,599 common shares for the settlement of an accrued liability to an ex officer and director. The accrued severance amount of $113,130 (CDN$128,855) was converted to 141,599 common shares at $0.80 (CDN$0.91) .
The directors & officers exercised stock options during the year as follows: One former director exercised 50,000 stock options at $0.75 per common share. One officer exercised 24,000 stock options at $0.75 per common share.
2007-2008
The Company and its subsidiary expensed a total of $253,270 in consulting fees & wages to seven Company Directors, and $258,176 to five of its officers.
No director or officer exercised stock options during the year.
F-37
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
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The Company has deferred income tax assets as follows:
2008 | 2007 | ||||||
$ | $ | ||||||
Net operating loss carried forward | 10,565,005 | 6,006,373 | |||||
Deferred Income tax on loss carried forward | 3,644,943 | 2,162,294 | |||||
Valuation allowance | (3,644,943 | ) | (2,162,294 | ) | |||
Deferred income taxes | - | - |
Reconciliation between the statutory federal income tax rate and the effective income tax rate of income tax expense for the period ended April 30, 2008 and 2007 is as follows:
2008 | 2007 | ||
Statutory Federal income tax rate | 34.5% | 36.0% | |
Valuation allowance | (34.5%) | (36.0%) |
The Company has determined that realization of a deferred tax asset is not likely and therefore a valuation allowance has been recorded against this deferred income tax asset.
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As of April 30, 2008 the Company has non-capital losses of approximately $10,560,587 available to offset future taxable incomes which expire as follows:
2009 | $189,093 |
2010 | $254,194 |
2014 | $206,177 |
2015 | $336,038 |
2023 | $1,200 |
2024 | $96,273 |
2025 | $543,414 |
2026 | $1,137,406 |
2027 | $3,585,249 |
2028 | $4,216,011 |
On August 20, 2007 Mrs. Lisa Rose was appointed Corporate Secretary of YGC, the Company’s wholly-owned subsidiary.
On October 30, 2007, the Company's board of directors accepted the resignation of Chester Idziszek in his capacity as director and as a member of the Audit Committee, effective as of October 22, 2007. There were no disagreements between the Company and Mr. Idziszek with respect to the Company's operations, policies or practices. On December 6, 2007 the board appointed Mr. Howard Barth to fill the vacancy left by Mr. Idziszek on the Audit Committee. Mr. Barth's appointment will expire on April 30, 2008.
F-38
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
20. CHANGES IN OFFICERS AND DIRECTORS-CONT'D
On December 13, 2007 the Company's board of directors accepted the resignation of Mr. Paul A. Gorman in his capacity as CEO and as a director. There were no disagreements between the Company and Mr. Gorman with respect to the Company's operations, policies or practices. Mr. Ken Hill was appointed interim CEO until a successor for Mr. Gorman was appointed.
On December 15, 2007 the Company's board of directors appointed Mr. Ronald K. Mann as President and CEO and a director.
On December 18, 2007 the Company's board of directors appointed Mr. Cletus J. Ryan as Vice President Corporate Development.
On January 10, 2008 Mr. Ronald K. Mann was appointed President and CEO and a director of YGC, the Company’s wholly-owned subsidiary.
On January 14, 2008 the Company's board of directors formed an Executive Committee and appointed Mr. J.L Guerra, Jr, Mr. Kenneth J. Hill and Mr. Ronald K. Mann, all directors of the Company, to sit on said committee.
On February 21, 2008 the Company's board of directors accepted the resignation, effective March 11, 2008 of Mr. Stewart Fumerton as Vice President, Exploration. There were no disagreements between Mr. Fumerton and the Company with respect to the Company's operations, policies or practices.
On February 21, 2008 the Company's board of directors appointed Mr. G.E. (Ted) Creber as a director and member of the Audit Committee.
On March 18, 2008 the Company’s board of directors appointed Mr. Gary Cohoon as Vice President, Exploration.
On April 30, 2008 Mr. Howard Barth’s appointment to fill the vacancy left by Mr. Chester Idziszek on the Audit Committee expired.
21. SUBSEQUENT EVENTS
Subsequent to the year ended April 30, 2008 the Company sold the balance of 450,000 shares of Industrial Minerals, Inc. at an average selling price of $.0655 for a total consideration of $29,460 in the open market.
On May 5, 2008 the Company entered into an investor relations agreement (the “Equicom Agreement”) with Equicom Group Inc. (“Equicom”) pursuant to which Equicom was retained to provide the Company with general marketing and business consulting services for an initial term of one year, then renewable thereafter. Equicom will receive an annual work fee of $59,571 (CDN$60,000), payable in monthly installments of $4,964 (CDN$5,000). The initial prorated retainer in the amount of $4,319 (CDN$4,350) and the June 1-30, 2008 installment of $4,964 (CDN$5,000) were made on May 30, 2008. On July 1, 2008 the installment covering July 1-31, 2008 of $4,964 (CDN$5,000) was paid.
On May 16, 2008 the Company entered into a consulting agreement (the “Clarke Agreement”) with Clarke Capital Group Inc. (“Clarke”) pursuant to which Clarke was retained to provide the Company with investor relations and business communications services for an initial term of 6 months, renewable thereafter for an additional 6 month term. Upon execution of the Clarke Agreement the Company paid Clarke $14,893 (CDN$15,000). Clarke will also receive a monthly work fee of $3,475 (CDN$3,500) during the term of the agreement. Upon renewal, Clarke will receive an additional payment of $9,928 (CDN$10,000). Pursuant to the Clarke Agreement, the Company issued Clarke 50,000 shares of common stock on July 14, 2008, with an additional 50,000 shares issuable upon renewal.
F-39
YUKON GOLD CORPORATION, INC.(An Exploration Stage Mining Company)Notes to Consolidated Financial StatementsApril 30, 2008 and April 30, 2007(Amounts expressed in US Dollars)
21. SUBSEQUENT EVENTS - CONT'D
On May 20, 2008 YGC, the Company’s wholly-owned subsidiary entered into a service provision agreement with a company to provide cooking and first aid services on the Marg Property from June 15, 2008 to September 30, 2008. On June 4, 2008 the Company paid a $9,929 (CDN$10,000) advance to the service provider as per the terms of the agreement.
On June 11, 2008 the Company cancelled 200,000 stock options held by a former officer.
On June 16, 2008 an additional 18 claims were staked, known as the “Gram Claims” which became subject to the Hinton Option Agreement.
On June 17, 2008 the balance of 250,000 warrants granted to Ronald Mann vested.
On July 3, 2008 the board of directors appointed Kathy Chapman Interim Corporate Secretary to temporarily fill the Corporate Secretary position while Mrs. Lisa Rose is on maternity leave.
On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.126 (CDN$0.126) each. The balance of the property payment in the amount of $89,357(CDN$90,000) was paid in cash.
On July 23, 2008 the Company closed the first tranche of a non-brokered private placement of up to $992,851 (CDN$1,000,000). The Company has completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $615,578 (CDN$620,010). The Company paid a 5% finders fee on this private placement. The proceeds from the private placement of flow-through shares will be used by Yukon Gold for program expenditures on the Marg Property and the Mount Hinton Property. The private placement was exempt from registration pursuant to Regulation S promulgated under the Securities Act of 1933, as amended.
F-40
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
INDEMNIFICATION OF DIRECTORS
Our by-laws indemnify each person (includingItem 13. Other Expenses of Issuance and Distribution.
The following table shows the heirs, executors, administrators, or estate of such person) who is or was a director or officer of Yukon Gold to the fullest extent permitted or authorized by current or future legislation or judicial or administrative decision against all fines, liabilities, costs and expenses including attorney’s fees, arising outpayable by the Company in connection with this registration statement.
SEC Filing Fee | $ | 3,375 | ||
Legal Fees and Expenses | 40,000 | |||
Blue Sky Fees and Expenses | 7,500 | |||
Accounting Fees and Expenses | 5,000 | |||
Miscellaneous Expenses | 4,125 | |||
Total* | $ | 60,000 |
* All expenses other than the SEC filing fee are estimated.
Item 14. Indemnification of hisOfficers and Directors
The Nevada Revised Statutes and the Company’s Bylaws provide that the Company may indemnify any and all of its officers, directors, employees or her statusagents or former officers, directors, employees or agents, against expenses actually and necessarily incurred by them, in connection with the defense of any legal proceeding or threatened legal proceeding, except as to matters in which such persons shall be determined to not have acted in good faith and in the Company’s best interest.
Our Bylaws authorize indemnification of a director, officer, agent, employee or representative. The foregoing right of indemnification shall not be exclusive of other rightsagent against expenses incurred by him in connection with any action, suit, or proceeding to which those seeking anhe is named a party by reason of his having acted or served in such capacity, except for liabilities arising from his own misconduct or negligence in performance of his duty. In addition, even a director, officer, employee, or agent found liable for misconduct or negligence in the performance of his duty may obtain such indemnification may be entitled. Yukon Gold may maintain insurance, at its expense, to protect itself andif, in view of all officers and directors against fines, liabilities, costs and expenses, whether or not Yukon Gold would have the legal power to indemnify them directly against such liability.
Costs, charges, and expenses (including attorney’s fees) incurred by a person referred to abovecircumstances in defending a civil or criminal proceeding shall be paid by Yukon Gold in advance of the final disposition thereof upon receipt of any undertaking to repay all amounts advanced if it is ultimately determined that the person is not entitled to be indemnified by Yukon Gold and upon satisfaction of other conditions required by current or future legislation.
If this indemnification or any portion of it is invalidated on any ground bycase, a court of competent jurisdiction Yukon Gold nevertheless indemnifies eachdetermines such person described aboveis fairly and reasonably entitled to the fullest extent permitted by all portions of this indemnification that have not been invalidated and to the fullest extent permitted by law.
indemnification. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers, andor controlling persons of Yukon Gold pursuant to the foregoingthese provisions, or otherwise, be advisedwe have been informed that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is therefore unenforceable.
The Company currently has directors
Item 15. Recent Sales of Unregistered Securities.
During the year ended December 31, 2020: | Note | |||
Reference | ||||
● | 103,622,845 shares issued to management and consultants, | B | ||
● | 55,612,837 shares were issued to VitaNova Partners, LLC (“VitaNova”) in consideration for payment of expenses (amounting to $5,561). | B |
During 2020 and 2021 the Company sold 55,613,860 Units at a price of $0.01 per Unit to 18 persons. Each Unit consisted of one common share and a warrant to purchase one additional common share at a price of $0.20 per share. The warrants expire on December 31, 2022. | A | |
In May 2021 the Company acquired 29% of the issued and outstanding shares of GrowCo, Inc. as well as membership interests in GrowCo Partners 1, LLC from an unrelated third party. In consideration for the assignment of these securities the Company issued the unrelated third party 4,384,913 shares of the Company’s common stock as well as warrants to purchase an additional 4,384,913 shares of the Company’s common stock.The warrants are exercisable at any time on or before September 30, 2022 at a price of $0.20 per share. | B |
On July 12, 2021 the Company issued 91,072,971 shares of its common stock, as well as warrants to purchase an additional 10,249,375 shares of its common stock, to VitaNova Partners, LLC (VitaNova”) in payment of expenses (amounting to $9,108) paid by VitaNova on behalf of the Company. | B | |
The warrants are exercisable at any time on or before December 31, 2022 at a price of $0.20 per share. VitaNova then transferred those shares to certain members of VitaNova in exchange for the members’ interests in VitaNova. John McKowen, the Company’s only Officer and Director and a controlling person of VitaNova, did not receive any of those shares. In July 2021 the Company sold 41,007,200 shares of its common stock to an unrelated third party for $4,101. | B | |
In July 2021 the Company sold 4,116,870 shares of its common stock to five unrelated third parties for services rendered valued at $412.00 | B |
A. | The Company relied upon the exemption provided by Rule 506 of the Securities and Exchange Commission in connection with the sale of these shares. There was no general solicitation in connection with the sale of these shares. The persons who acquired these securities acquired them for their own accounts. The securities cannot be sold except pursuant to an effective registration statement or an exemption from registration. No commission was paid in connection with the sale of these securities. |
B. | The Company relied upon the exemption provided by Section 4(a)(2) of the Securities Act of 1933 in connection with sale of these securities. The persons who acquired these securities were sophisticated investors and were provided full information regarding the Company’s operations. There was no general solicitation in connection with the sale of these securities. The persons who acquired these securities acquired them for their own accounts. The securities cannot be sold except pursuant to an effective registration statement or an exemption from registration. No commission was paid in connection with the sale of these securities. |
II-1 |
Item 16. Exhibits and officers insurance in the amount of $5 million.Financial Statement Schedules
EXHIBITS INDEX
The following exhibits are filed as part ofwith or incorporated by referenced in this registration statement.Registration Statement:
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Item 17. | Undertakings |
The undersigned registrant hereby undertakes:
1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
i. | To include any prospectus required by Section l0 (a)(3) of the | |
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iii. | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. |
2) | That, for the purpose of determining any liability under the Securities Act of 1933 (the “Act”), each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
3) | To remove from registration by means of a post-effective amendment any of the | ||
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4) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: |
i. | If the registrant is relying on Rule 430B: |
A. | Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and |
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OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
ii. | If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
The following table sets forth expenses, incurred or expected to be incurred by Yukon Gold in connect with the registration of the securities being offered by the selling shareholders. Items marked with an asterisk (*) represent estimated expenses. We have agreed to pay all the costs and expenses of this registration. Selling security holders will not pay any part of these expenses.
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SEC Registration Fee |
| $ | 426.08 |
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Legal Fees and Expenses* |
| $ | 12,000 |
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Accounting Fees and Expenses* |
| $ | 5,000 |
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Printing |
| $ | 5,000 |
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Miscellaneous* |
| $ | 1,000 |
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TOTAL* |
| $ | 23,179 |
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5) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: |
RECENT SALE OF UNREGISTERED SECURITIES
On July 23, 2008 the Company closed the first tranche of a non-brokered private placement of up to $992,851 (CDN$1,000,000). The Company has completed the sale of 4,134,000 common shares on a flow-through basis at a price of $0.15 (CDN$0.15) per share for gross proceeds of $615,578 (CDN$620,010). The Company paid a 5% finders fee on this private placement. The proceeds from the private placement of flow-through shares will be used by Yukon Gold for program expenditures on the Marg Property and the Mount Hinton Property. The private placement was exempt from registration pursuant to Regulation S promulgated under the Securities Act of 1933, as amended.
-III-
On July 7, 2008, the Company issued 476,189 common shares in settlement of a property payment on the Mount Hinton property. These shares represent $59,572 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.126 (CDN$0.126) each. The balance of the property payment in the amount of $89,357(CDN$90,000) was paid in cash.
On June 18, 2008 the Company approved the issuance of 100,000 shares of common stock to a consultant as payment for investor relations and business communications services. Of that amount, 50,000 shares were issued July 14, 2008 with the balance of 50,000 shares to be issued upon renewal of the consulting agreement. The issuance was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On August 16, 2007 the Company completed a private placement (the “Financing”) with Northern Securities Inc. (“Northern”), acting as agent. The Financing was comprised of the sale of 1,916,666 units (the “Units”) at $0.42 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $802,101 (CDN$862,499.70) and the sale of 543,615 flow-through units (the “Flow-Through Units” which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at $0.49 (CDN$0.52) per Flow-Through Unit (the “Flow-Through Unit Issue Price”) for gross proceeds of $262,884 (CDN$282,680). The proceeds raised were allocated between the offering of shares and the sale of tax benefits A liability of $35,381 was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investor. Each Unit consisted of one non-flow through common share (“Common Share”) and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.60 (CDN$0.60) per share. Each Flow-Through Unit consisted of one flow-through common share and one half of one Common Share purchase warrant (each whole warrant, an “FT Warrant”). Each FT Warrant is exercisable into one Common Share until August 16, 2009 at an exercise price of $0.70 (CDN$0.70) per share. The Company paid Northern a commission equal to 8% of the aggregate gross proceeds which amounted to $85,199 (CDN$91,614) and issued 153,333 “Unit Compensation Warrants” and 43,489 “FT Unit Compensation Warrants”. Each Unit Compensation Warrant is exercisable into one Unit at the Unit Issue Price until August 16, 2009. Each FT Unit Compensation Warrant is exercisable into one Common Share and one half of one FT Warrant at the Flow-Through Unit Issue Price until August 16, 2009. Yukon Gold also granted Northern an option (the “Over-Allotment Option”) exercisable until October 15, 2007 to offer for sale up to an additional $468,691 (CDN$500,000) of Units and/or Flow-Through Units on the same terms and conditions. The Company paid a $70,304 (CDN$75,000) due diligence fee to Northern at closing. The Company reimbursed Northern expenses of $18,600 (CDN$20,000) and legal fees of $18,600 (CDN$20,000).
On November 16, 2007 the Company completed the second part of a private placement (the “Second Financing”) with Northern acting as agent. The Second Financing was comprised of the sale of 2,438,888 units (the “Units”) at $0.46 (CDN$0.45) per Unit (the “Unit Issue Price”) for gross proceeds of $1,127,028 (CDN$1,097,500) and the sale of 1,071,770 flow through units (the “Flow-Through Units”) at $0.53 (CDN$0.52) per Flow-Through Unit for gross proceeds of $572,315 (CDN$557,320). The proceeds raised were allocated between the offering of shares and the sale of tax benefits. A liability of $77,043was recognized for the sale of taxable benefits, which was reversed and credited to income when the Company renounced resource expenditure deduction to the investors.
The foregoing placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act.
On July 7, 2007 the Company issued 136,364 common shares in settlement of a property payment on the Mount Hinton property. The shares represent $57,252 (CDN$60,000) which is 40% of the contracted payment and were valued at $0.42 (CDN$0.44) each. The balance 60% payment was paid in cash. The foregoing placement was undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act.
-IV-
On April 25, 2007 the Company issued 2,823,049 common shares and an additional 282,309 shares as a penalty, relating to the private placement of 2,823,049 flow-through special warrants on December 28, 2006 (refer to note below). The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The Company expensed an amount of $163,739 to registration rights penalty expense under the head General and Administration and credited this to Additional Paid in Capital. The foregoing placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act.
On April 25, 2007 the Company issued 334,218 common shares and an additional 33,423 shares as a penalty, relating to the private placement of 334,218 unit special warrants on December 28, 2006 (refer to note above). The penalty shares were issued as the Company failed to obtain receipts for the final prospectus or effectiveness of the registration statement by February 26, 2007 (60 days from the closing date). The foregoing placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act.
On January 11, 2007, the Company issued its obligated 400,000 common shares and an additional 4,000 common shares as penalty, in lieu of sale of 400,000 Special Warrants to a Canadian accredited investor for $404,000 paid on December 15, 2005. Each Special Warrant entitled its holder to acquire one common share of the Company and one common share purchase warrant at no additional cost. The Company was obligated to have a registration statement become effective within 181 days of the closing. In the absence of a registration statement being declared effective within 181 days of the closing, the Company issued an additional 4,000 common shares to the Canadian accredited investor at no extra cost as a penalty. The Company expensed an amount of $5,000 to registration rights penalty expense under the head General and Administration and credited this to Additional Paid in Capital. The foregoing placements were undertaken pursuant to an exemption offered by Regulation S promulgated under the Securities Act.
On December 28, 2006, the Company completed a private placement of 2,823,049 flow-through special warrants (which qualify as flow-through shares for the purposes of the Canadian Income Tax Act) at a price of $0.90 (CDN$1.05) per warrant and 334,218 unit special warrants at a price of $0.77 (CDN$0.90) per warrant for aggregate gross proceeds to the Company of $2,801,610 (CDN$3,264,996). Each flow-through special warrant entitles the holder to acquire, for no additional consideration, one common share of the Company. Each unit special warrant entitles the holder to acquire, for no additional consideration, one common share and one common share purchase warrant of the Company. Each common share purchase warrant entitles the holder to acquire one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date. In connection with this private placement, the Company agreed to file a prospectus in Canada qualifying the issuance of the common shares and warrants issuable upon the exercise of the special warrants as well as those common shares issuable on exercise of the common share purchase warrants. In addition, the Company agreed to file a registration statement in the United States covering the re-sale of common shares underlying the units and warrants by the respective shareholders. In the event the Company fails to obtain effectiveness for the final prospectus and the registration statement by February 26, 2007 (60 days from the closing date), each flow-through special warrant will entitle the holder to acquire 1.1 common shares on exercise thereof and each unit special warrant will entitle the holder to acquire 1.1 common shares and 1.1 common share purchase warrants on exercise thereof. The flow-through and unit special warrants will be automatically exercised on the earlier of (i) the third business day after the issuance of a receipt for the final prospectus and the effectiveness of the registration statement, or (ii) the four month anniversary of the closing date of the private placement. The Company subsequently declined to file a prospectus in Canada but did file the registration statement in the United States. As result of the Company’s decision not to file a prospectus in Canada, primarily because of the costs involved, the Company was obligated to pay the penalty as described herein to the holders of the securities issued in the private placement. On closing, Northern Securities Inc., the lead agent received a cash commission of $171,164 (CDN$198,550) as well as 169,042 flow-through compensation options and 23,395 unit compensation options. In addition, as part of the private placement, Limited Market Dealer Inc. received a cash commission granted to Northern Securities, Inc. as well as 28,571 flow-through compensation options and Novadan Capital Ltd. received a cash payment of $28,362 (CDN$32,900) as well as 32,900 unit compensation options. Each flow-through compensation option entitles the holder to acquire, for no additional consideration, one flow-through compensation warrant, each exercisable into one common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. Each unit compensation option entitles the holder to acquire, for no additional consideration, one unit compensation warrant, each exercisable at US$0.81 (CDN$0.941) into one common share and one common share purchase warrant of the Company at a price of US$0.90 (CDN$1.05) for a period of 24 months from the closing date of December 28, 2006. As a result of the penalty each flow-through compensation option will entitle the holder to acquire 1.1 flow-through compensation warrants on exercise thereof and each unit compensation option granted to Northern Securities, Inc. will entitle the holder to acquire 1.1 unit compensation warrants on exercise thereof. The Company will use the gross proceeds from the sale of flow-through special warrants for the exploration and development of its properties, located in the Mayo Mining District of the Province of Yukon, Canada. The Company will use the net proceeds from the sale of unit special warrants for general working capital purposes. The private placement was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
-V-
On December 12, 2006, a former officer of the Company exercised 50,000 stock options at a price of $0.75 per share for a total of $37,000. The private placement was exempt from registration under the Securities Act pursuant to Regulation S.
On December 6, 2006, the Company issued to Atna Resources Ltd 133,334 common shares in the amount of $100,000 as part of a property payment for the Marg Property as provided in the Marg Acquisition Agreement. The property payment also included a cash payment in the amount of $ 86,805(CDN$100,000). The entire payment of $186,805 was expensed in the consolidated statements of operations. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
In October of 2006 the Company completed another brokered private placement of 550,000 units for consideration of $550,000. The units each consisted of (a) one common share of the Company and (b) one 2-year warrant to purchase a common share at a price of $1.50 per share for the first twelve (12) months from the date of closing and thereafter $2.00 per share for the remainder of the two-year term of the warrant. The purchasers of the units were non-U.S persons and the offering was conducted entirely in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. Each of the purchasers executed a subscription agreement in which they agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States. A finder’s fee of 6% and reimbursement of all expenses (subject to a cap) was paid to Novadan Capital Ltd., a Toronto, Ontario limited market dealer (“Novadan”) in connection with this private placement. On November 27, 2007 the board of directors approved the extension of the expiry date of the share warrants to October 4, 2009. the expiry date of the warrants to October 4, 2009. The private placement was exempt from registration under the Securities Act pursuant to Regulation S.
On September 7, 2006, an officer of the Company exercised 24,000 stock options at a price of $0.75 per share. The private placement was exempt from registration under the Securities Act pursuant to Regulation S.
In October of 2006, the Company completed another brokered private placement of 400,000 units where each unit consisted of a common share and a share purchase warrant. The units were priced at $1.00 per unit for a total of $400,000. The Company paid a finders fee equal to 6% of the gross proceeds and reimbursed expenses for 3% of the total consideration. The warrants have a two-year term and are exercisable at $1.50 per share in the first twelve months of the term and $2.00 per share in the remaining twelve months of the term. Closing of this placement required Toronto Stock Exchange approval. Conditional approval was given by the Toronto Stock Exchange on August 29, 2006. The purchaser of the units was a single accredited investor. The private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D. On November 27, 2007 the board of directors approved the extension of the expiry date of the share warrants to October 4, 2009.
-VI-
On August 11, 2006 the Company issued 817,980 restricted shares in total to three consultants for services relating to business promotion and development. These consultants assisted management in the preparation of financial offerings and in arranging meetings and making presentations to the brokerage community and institutional investors in both the United States and Canada. Except for 342,780 common shares which were earned by these consultants as of October 31, 2006, the balance of 475,200 common shares were held in escrow to be released to each consultant in 8 monthly installments of 19,800 common shares commencing November 1, 2006. Out of 475,200 common shares held in escrow, the Company received back 356,400 common shares for cancellation.
On July 17, 2006 the Company issued 61,171 common shares for the exercise of 61,171 warrants at $0.88 (CDN$1.00) from a warrant holder in consideration of $53,824 (CDN$61,171). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On July 7, 2006 the Company issued 43,166 common shares and paid $80,501 (CDN$90,000) in cash in settlement of a property payment for the Mount Hinton Property. The shares represented payment of $53,845 (CDN $60,000) and were valued at $1.25 (CDN$1.39) each. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with the Hinton Syndicate and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On July 7, 2006 the Company issued 64,120 common shares for the exercise of 64,120 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $57,869 (CDN$64,120). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 29, 2006 the Company issued 158,090 common shares for the exercise of 158,090 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $141,632 (CDN$158,090). The securities were issued to a Canadian investor pursuant to an exemption under Regulation S.
On June 28, 2006 the Company issued 17,971 common shares for the exercise of 17,971 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $15,939 (CDN$17,971). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 28, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $38,895 (CDN$43,667). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On June 28, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder (and former officer of the Company) in consideration of $14,253 (CDN$16,000). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Regulation S.
On June 22, 2006 the Company issued 43,667 common shares for the exercise of 43,667 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of $39,368 (CDN$43,667). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 30, 2006 the Company issued 141,599 common shares for the settlement of an accrued liability to an ex officer and director. The accrued severance amount of $113,130 (CDN$128,855) was converted to 141,599 common shares at $0.80 (CDN$0.91). The former officer is an accredited investor and a Canadian citizen. The issuance was undertaken pursuant to an exemption from registration under Regulation D. The former officer was an accredited investor pursuant to Rule 501 of Regulation D (both in terms of net worth and as an executive of the Company).
-VII-
On May 29, 2006 the Company issued 10,000 common shares for the exercise of 10,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $8,987 (CDN$10,000). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 29, 2006 the Company issued 45,045 common shares for the exercise of 45,045 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of $40,450 (CDN$45,045). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On May 29, 2006 the Company issued 16,000 common shares for the exercise of 16,000 warrants at $0.89 (CDN$1.00) from a warrant holder (a former Canadian director of the Company) in consideration of $14,280 (CDN$16,000). The issuance of these shares was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation D. The holder of the warrant was an accredited investor pursuant to Rule 501 Regulation D (both in terms of net worth and as an executive of the Company).
On April 11, 2006, a Canadian director of the Company exercised his option to purchase 10,000 common shares at the option price of $0.55 per share. The Company received payment and issued 10,000 common shares. The issuance of these shares was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On March 28, 2006 the Company completed a brokered private placement through the issuance of 5,331,327 common share units at a price of $0.60 per unit for gross proceeds of $3,198,799. The Company also completed a private placement through the issuance of 25,000 so-called “flow-through” shares at a price of $0.75 per share for gross proceeds of $ 18,750. “Flow-through” shares carry certain tax benefits to shareholders who are Canadian tax payers. The Company must use the proceeds from the placement of “flow-through” securities for exploration and development programs in order to enable the holders of “flow-through” shares to derive the tax benefits in Canada. Each Common share unit consists of one share and one-half of one common share purchase warrant. Each whole common share purchase warrant entitles the holder to purchase one common share at $0.90 per share for a period expiring on March 28, 2008. Novadan (or its permitted assignees) received a commission in connection with this private placement consisting of cash equal to 9% of the proceeds of the private placement in Canada ($289,579.00) and 533,133 broker’s warrants equaling 10% of the number of common share units sold. Each broker warrant entitles Novadan or its permitted assigns to purchase common shares and one-half share purchase warrant for $0.60 until March 28, 2008. Each full warrant is then exercisable for $0.90. In addition, Yukon Gold paid all of Novadan’s expenses related to the private placement, subject to a cap of $20,000. The purchasers of 3,873,993 of these units were non-U.S persons pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act of 1933, as amended (the “Securities Act”). Each purchaser in the Canadian private placement executed a subscription agreement in which they agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States. The Purchasers of 1,482,334 of these units were United States citizens, all of whom were accredited investors as that term is used in Regulation D. The U.S. private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D promulgated pursuant to the Securities Act (“Regulation D”). As part of the agreement with Novadan in connection with this offering, the Company granted to Novadan a right-of-first refusal to act as underwriter or best-efforts placement agent in connection with any subsequent public or private offering by the Company within eighteen months of the closing. In addition, Yukon Gold entered into a Consulting Agreement with Novadan for ongoing financial and strategic advice. As compensation under the Consulting Agreement, Yukon Gold will issue to Novadan 240,000 shares of its common stock, such shares to be issued in equal installments over the twelve-month period of the Consulting Agreement. This Consulting Agreement was terminated as of October 23, 2006. On December 19, 2006 the Company issued 160,000 shares to Novadan. On November 27, 2007 the board of directors approved the extension of the expiry date of the share warrants issued in connection with this financing from March 28, 2008 to March 28, 2009.
-VIII-
On January 11, 2006 a holder converted promissory notes of the Company on their due dates and the Company issued 101,150 common shares and 50,000 warrants covering the principal amounts of $75,000 and interest in the amount of $1,533 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 30, 2005, Yukon Gold completed a private placement of 200,000 flow-through special warrants to a single investor in Canada for consideration of $180,000 (CDN$205,000). Each such flow-through special warrant entitles the holder to acquire one “flow-through” common share of the Company for no additional consideration. So-called “flow-through” shares carry certain tax benefit to Canadian holders. On December 19, 2006, the Company issued 200,000 common shares. The purchaser of the flow-through special warrants was a non-U.S person pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On December 15, 2005, the Company completed the sale of 400,000 special warrants to a single investor in Canada at a purchase price of $1.01 per special warrant for total consideration of $404,000. Each special warrant entitles the holder to purchase one common share of the Company and one additional common share purchase warrant at no additional cost. On January 12, 2007 the warrants were exercised and the Company issued 404,000 common shares (which included penalty shares). The purchaser of the special warrants was a non-U.S person pursuant to a private placement in Canada. The private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On December 7, 2005 an accredited investor converted promissory notes of the Company on their due dates and the Company issued 34,306 common shares and 17,001 warrants covering the principal amounts of $25,500 and interest in the amount of $409 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 7, 2005 the board of directors authorized the issuance of 10,000 common shares to a shareholder upon the exercise of 10,000 warrants in consideration of $8,772 (CDN$10,000). The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On December 6, 2005 the board of directors authorized the issuance of 133,333 common shares valued at $100,000 for a property payment to Atna Resources Ltd., along with a cash payment of $43,406 (CDN$50,000) as per terms of the Marg Acquisition Agreement. The common shares along with the cash payment were delivered to Atna Resources Ltd. on December 12, 2005. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On December 5, 2005, the Company completed a private placement of 150,000 common shares and 150,000 warrants to a single accredited investor for consideration of $151,500. Each common share was priced at $1.00 and each warrant at $0.01. Each warrant entitles the holder to purchase one common share of the Company at an exercise price of $1.00 for a period of one year from the date of issuance. This private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
-IX-
On November 9, 2005, an accredited investor converted a promissory note on its due date and the Company issued 76,525 common shares and 37,500 warrants covering the principal amount of $56,250 and interest in the amount of $1,143 in accordance with the conversion provisions of the notes. The expiry date of the warrants was extended to 15 months after the conversion date. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On October 18 and 24, 2005 the Company issued a total of 59,547 common shares and 29,167 warrants covering the principal amount of $43,750, plus interest of $910, on conversion of a convertible promissory note issued on October 6, 2004. The holder of the promissory note was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On October 18, 2005 the Company authorized the issuance of 14,000 common shares for the exercise of 14,000 warrants from a warrant holder in consideration of $12,000. The holder of the warrants was an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On August 31, 2005, the Company accepted subscriptions from four accredited investors and one accredited corporation, all residents of Canada, for a total of 200,000 units priced at $0.55 per unit for a total of $110,000. Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full-share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring August 31, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On August 29, 2005, the Company completed the sale of 149,867 units at $0.55 per unit to a Canadian director of the Company for $82,427 (CDN$100,000). Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full-share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring on August 5, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act.
On August 26, 2005 the board of directors approved the issuance of 490,909 units at $0.55 per unit to J.L. Guerra, Jr., then an arms length accredited shareholder for a total of $270,000. Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full share purchase warrant entitles the holder to purchase one common share at $1.00 per share, after one year and seven days following closing, for a period of two (2) years following such date. The Company received $20,000 of the subscription price on August 12, 2005 as a loan to be applied to the subscription price and $100,000 on September 15, 2005 and a promissory note for $150,000, due on or before October 1, 2005, for the balance of the subscription price. The promissory note was paid in full by the due date. Mr. Guerra subsequently became a director of the Company on November 2, 2005 and then became chairman of the board on July 11, 2006. Mr. Guerra is an accredited investor. This private placement was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On August 25, 2005 the Company entered into a Consulting Agreement with Endeavor Holdings, Inc. (“Endeavor”), based in New York, New York to assist the Company in raising capital. Under the terms of this agreement the Company agreed to pay Endeavor 150,000 common shares at the rate of 25,000 shares per month. Either party could cancel the agreement upon 30 days notice. The Company issued 150,000 common shares valued at $130,500 to Endeavor. Endeavor is an accredited investor. The issuance was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
-X-
On August 23, 2005 the board of directors approved the issuance of 24,336 units to an arms length investor and 12,168 units to an officer of the Company at $0.55 per unit, in settlement of an accounts payable for services, for a total of $20,077 (CDN$24,398). Each unit consists of one common share and one-half share purchase warrant. Each common share was priced at $0.545 and each full warrant at $0.01. Each full share purchase warrant entitles the holder to purchase one common share at $1.00 per share for a period expiring on August 15, 2007. The issuance of these securities was undertaken pursuant to negotiated agreements and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
On August 5, 2005 the board of directors authorized the issuance of 369,215 common shares and 184,608 share purchase warrants in settlement of a demand promissory note in the amount of $200,000 plus interest of $3,068.25. Each common share was priced at $0.545 and each full warrant at $0.01. Each share purchase warrant entitles the holder to purchase one common share for $1.00 per share on or before August 5, 2007. This private placement was undertaken pursuant to an exemption from registration under Regulation S promulgated pursuant to the Securities Act. The purchaser executed a subscription agreement in which it agreed to the requirements of Regulation S for offerings by a U.S. issuer outside the United States.
On March 2, 2005 the Company issued 76,204 common shares on conversion of a convertible promissory note. The holder of the promissory note was an accredited investor. The issuance of shares was undertaken pursuant to an exemption from registration under Section 4(2) the Securities Act and Rule 506 of Regulation D.
On March 1, 2005 the Company issued 133,333 common shares to Atna as a property payment in the amount of $100,000 for the Marg Property. The issuance of these shares was undertaken pursuant to a negotiated asset acquisition agreement with Atna and was exempt from registration under the Securities Act pursuant to an exemption afforded by Regulation S.
UNDERTAKINGS
The undersigned Registrant hereby undertakes:
To file, during any periodregistrant undertakes that in which it offers or sellsa primary offering of securities a post-effective amendmentof the undersigned registrant pursuant to this registration statement, to:
(i) Include any prospectus required by Section 10(a)(3)regardless of the Securities Actunderwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of 1933;
(ii) Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
(iii) Include any additional or changed material information on the plan of distribution; and
(iv) Remove from registration any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities that remain unsold at the end of the offering.to such purchaser:
That, for determining liability under the Securities Act, the Registrant shall treat each post-effective amendment as a new registration statement of the securities offered, and the offering of the securities at that time to be the initial bona fide offering.
i. | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
ii. | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
iii. | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
iv. | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser |
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6) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred andor paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding), is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
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SIGNATURES
In accordance with
Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that itregistrant has reasonable grounds to believe that it meets all of the requirements of filing on Form S-1 and authorizedduly caused this registration statementRegistration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Citycity of Toronto, CanadaDenver, Colorado on August 29, 2008.July __, 2021.
VETANOVA TECHNOLOGIES, INC. | |||||
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In accordance with the requirements of the Securities Act of 1933,l933, this registration statement washas been signed by the following persons in the capacities and on the dates stated.indicated.
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John R. McKowen | |||||
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| July __, 2021 |
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VetaNova, Inc.
Registration Statement on Form S-1
Exhibits