Attached files
As filed
with the Securities and Exchange Commission on August ___, 2010
Registration
No. __________
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-1
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
TUNDRA GOLD
CORP.
(Exact
name of Registrant as specified in its charter)
Nevada
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1040
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27-2019656
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(State
or other jurisdiction of incorporation or organization)
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(Primary
Standard Industrial Classification Code)
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(I.R.S.
Employer Identification No.)
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Tundra
Gold Corp.
200 S
Virginia Street
Reno,
Nevada 89501
Telephone: (775)
398-3012
(Address,
including zip code, and telephone number,
including
area code, of registrant's principal executive offices)
Gary
Basrai
Tundra
Gold Corp.
200 S
Virginia Street
Reno,
Nevada, 89501
Telephone:
(775) 398-3012
Facsimile: (775)
686-2401
(Name,
address, including zip code, and telephone number,
including
area code, of agent for service)
Copies of
all correspondence to:
David
Lubin, Esq.
David
Lubin & Associates, PLLC
5
North Village Avenue
Rockville
Centre, New York 11570
Telephone:
(516) 887-8200
Facsimile:
(516) 887-8250
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1
Approximate
date of commencement of proposed sale to the public: From time to time after the
effective date of this registration statement.
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, please
check the following box: [x]
If this
form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. □
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
statement number of the earlier effective registration statement for the same
offering. □
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
statement number of the earlier effective registration statement for the same
offering. □
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,”
“accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act. (Check one)
Large
accelerated filer
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□
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Accelerated
filer
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□
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Non-accelerated
filer
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□
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Smaller
reporting company
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x
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2
Calculation
of Registration Fee
Title
of Class of Securities to be Registered
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Amount
to be Registered
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Proposed
Maximum Aggregate Price Per Share
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Proposed
Maximum Aggregate Offering Price
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Amount
of Registration Fee
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Common
Stock, $0.0001 per share(1)
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4,740,000
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$0.10(2)
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$474,000
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$33.80
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Total
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4,740,000
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$0.102)
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$474,000
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$33.80
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(1)
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Represents
common shares currently outstanding to be sold by the selling security
holders.
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(2)
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The
offering price has been estimated solely for the purpose of computing the
amount of the registration fee in accordance with Rule 457(o). Our common
stock is not traded and any national exchange and in accordance with Rule
457, the offering price was determined by the price shares were sold to
the selling security holders in private placement transactions. The
selling shareholders may sell shares of our common stock at a fixed price
of $0.10 per share until our shares are quoted on the OTC Bulletin Board
and thereafter at prevailing market prices or privately negotiated prices.
The fixed price of $0.10 has been determined as the selling price based
upon the original purchase price paid by the selling security holders of
$0.01 per share for 3,500,000 common shares and $0.05 per share for
1,240,000 common shares plus an increase based on the fact the shares will
be liquid and registered. There can be no assurance that a
market maker will agree to file the necessary documents with the Financial
Industry Regulatory Authority (“FINRA”), which operates the OTC Electronic
Bulletin Board, nor can there be any assurance that such an application
for quotation will be approved. We have agreed to bear the expenses
relating to the registration of the shares for the selling security
holders.
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In
the event of a stock split, stock dividend or similar transaction
involving our common stock, the number of shares registered shall
automatically be increased to cover the additional shares of common stock
issuable pursuant to Rule 416 under the Securities Act of 1933, as
amended.
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The Registrant hereby amends
this Registration Statement on such date or dates as may be necessary to delay
its effective date until the Registrant 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 or until
the Registration Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.
THE
INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT
SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER 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.
PRELIMINARY
PROSPECTUS SUBJECT TO COMPLETION DATED ______ __, 2010
3
TUNDRA
GOLD CORP.
4,740,000
Shares of Common Stock
This
prospectus relates to the resale of 4,740,000 shares of common stock, par value
$0.0001, of Tundra Gold Corp., which are issued and outstanding and held by
persons who are stockholders of Tundra Gold Corp.
Our
common stock is presently not traded on any market or securities exchange. The
shares of our common stock can be sold by selling security holders at a fixed
price of $0.10 per share until our shares are quoted on the OTC Bulletin Board
and thereafter at prevailing market prices or privately negotiated prices. The
fixed price of $0.10 has been determined as the selling price based upon the
original purchase price paid by the selling shareholders of $0.01 per share for
3,500,000 of the shares and $0.05 per share for 1,240,000 of the shares, plus an
increase based on the fact the shares will be liquid and registered. As a result
of our business activities, the subscription price paid by investors in the
second private placement was higher than in the first. After the
effective date of the registration statement relating to this prospectus, we
hope to have a market maker file an application with FINRA, for our common stock
to be eligible for trading on the Over the Counter Bulletin Board. We do not yet
have a market maker who has agreed to file such application.
Investing
in our securities involves significant risks. See “Risk Factors” beginning on
page 3.
NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The
information in this prospectus is not complete and may be changed. This
prospectus is included in the registration statement that was filed by us with
the Securities and Exchange Commission. The selling security holders may not
sell these securities until the registration statement becomes effective. This
prospectus is not an offer to sell these securities and is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
The date
of this prospectus is __________, 2010
4
Table
of Contents
Page
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Prospectus
Summary
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6
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Risk
Factors
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14
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The
Offering
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25
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Use
of Proceeds
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25
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Determination
of Offering Price
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25
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Forward
Looking Statements
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26
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Selling
Security holders
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26
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Plan
of Distribution
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28
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Description
of Securities
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31
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Interest
of Named Experts and Counsel
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31
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Description
of Business
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31
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Description
of Property
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33
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Legal
Proceedings
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36
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Market
for Common Equity and Related Stockholder Matters
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36
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Dividend
Policy
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37
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Share
Capital
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37
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Management’s
Discussion and Analysis or Plan of Operations
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38
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Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
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NA
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Directors,
Executive Officers, Promoters, and Control Persons
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40
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Director
Independence
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41
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Executive
Compensation
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41
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Security
Ownership of Certain Beneficial Owners and Management
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42
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Certain
Relationships and Related Transactions
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43
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Expenses
of Issuance and Distribution
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43
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Legal
Matters
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44
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Indemnification
for Securities Act Liabilities
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44
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Experts
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44
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Where
You Can Find More Information
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44
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Financial
Statements
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F-1
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Information
not Required in Prospectus
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45
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5
PROSPECTUS
SUMMARY
As used
in this prospectus, references to the “Company,” “we,” “our” or “us” refer to
Tundra Gold Corp., unless the context otherwise indicates.
The
following summary highlights selected information contained in this prospectus.
Before making an investment decision, you should read the entire prospectus
carefully, including the “Risk Factors” section, the financial statements and
the notes to the financial statements.
Corporate
Background
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Tundra
Gold Corp. was incorporated under the laws of the State of Nevada on
September 16, 2010 as Titan Gold Corp. On February 25, 2010 the Company
amended its articles of incorporation to change its name to Tundra Gold
Corp. We are an early stage mineral exploration company with
plans to acquire, explore, and if warranted and feasible, develop natural
resource properties.
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Strategy
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Our
primary focus in the natural resource sector is gold. Though it
is possible to take a resource property that hosts a viable ore deposit
into mining production, the costs and time frame for doing so are
considerable, and the subsequent return on investment for our shareholders
would be very long term indeed. We therefore anticipate optioning or
selling any ore bodies that we may discover to a major mining
company.
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Acquisition
of Interest
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On
May 18, 2010 the Company executed a property lease agreement with
MinQuest, Inc. (“MinQuest”) whereby the Company leased certain unpatented
mineral claims from MinQuest collectively referred to as the Marietta
Property (the “Marietta”). The lease agreement is for a
period of 20 years with annual lease payments of $5,000 due on May 15 of
each year. There are no minimum annual exploration expenditures
required under the agreement.
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Description
and location of Marietta Property
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The
Marietta Property is located in Mineral County, Nevada, 120 km north of
Tonopah and currently consists of 5 unpatented claims.
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Exploration
History of Marietta Property
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Exploration
history includes some small unrecorded production from the property that
likely occurred between the early 1900’s and 1940’s. Modern
exploration was confined to work conducted by American Gold Resources
(AGR) from 1989 to 1992. AGR completed a total of 59 drill
holes testing the above referenced resource area. Of this
amount, 33 holes were drilled on 50 feet centers while the remaining holes
were drilled on 200 feet centers. Drilling to a depth of 350
feet has defined a mineralized zone that is mostly hosted within a graben
of calcareous sandstone with quartz veins. Further work is
needed to determine the strike and extent and depth of the
mineralization.
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6
Geology
of Marietta Property
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The
Marietta Property is located within the Walker Lane trend. The
Walker Lane is a linear north-northwest trending depression extending some
800 km (500 miles) north from the Garlock Fault-Las Vegas area to
south-central Oregon. Within it are Walker, Goose, and Pyramid Lakes. This
trough is part of the Walker Lane Fault Zone, a major tectonic system that
includes Owens and Death Valleys and several prominent faults, and is the
site of many contemporary earthquakes. Located at the juncture of two
contrasting tectonic styles, the Sierra Nevada and the Basin and Range,
the Walker Lane region is deforming in a complex way by both extensional
and transcurrent (sliding) fault movements.
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The
Walker Lane shear zone straddles the border between Nevada and California
and has a long history of exploration and mining, dating back to the
discovery of the famous Comstock Lode in the late 1850s. The Walker Lane
is notable for its numerous occurrences of volcanic-hosted epithermal gold
and silver deposits. The project area covers sheared and
brecciated silciclastic rocks of the Triassic Excelsior Formation intruded
by a porphyryitic quartz-monzonite of Laramide age. The
mineralized zone is mostly hosted within a graben of calcareous sandstone
with quartz veins.
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Current
State of Exploration
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The
Marietta claims presently do not have any mineral resources or reserves.
There is no mining plant or equipment located within the property
boundaries. Currently, there is no power supply to the mineral
claims.
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Geological
Exploration Program
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The
Company is in the process of compiling all historic drilling and sampling
results. These results will be evaluated to determine if one or
more precious metals may exist within the property
boundaries. Our planned program includes compilation of all
activities to the present with the goal of producing an outline of
mineralized areas that will guide further exploration
drilling. However, this program is exploratory in nature and no
minable reserves may ever be found.
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Intellectual
Property Rights
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We
do not have any intellectual property rights.
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7
Competition
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The
mineral exploration industry is intensely competitive, highly fragmented
and subject to rapid change. We may be unable to compete
successfully with our existing competitors or with any new
competitors. We compete with many exploration companies which
have significantly greater personnel, financial, managerial, and technical
resources than we do. This competition from other companies
with greater resources and reputations may result in our failure to
maintain or expand our business.
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Government
Regulations
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Mineral
resource exploration, production and related operations are subject to
extensive rules and regulations of federal, state and local
agencies. We may be required to obtain work permits, post bonds
and perform remediation work for any physical disturbance to the land in
order to comply with these laws. While our planned exploration
program budgets for regulatory compliance, there is a risk that new
regulations could increase our costs of doing business and prevent us from
carrying out exploration program.
Failure
to comply with these rules and regulations can result in substantial
penalties. Our cost of doing business may be affected by the
regulatory burden on the mineral industry. We believe that compliance with
the laws will not adversely affect our business
operations
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Employees
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We
currently have no employees.
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Property
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The
Company currently maintains its executive offices on a shared basis at 200
S. Virginia, 8th
Floor, Reno, Nevada, 89501. We have a one year lease that commenced March
1, 2010 at a rate of $169 per month
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See
“Acquisition of Interest” above.
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|||
The
Offering
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|||
Securities
offered:
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4,740,000
shares of common stock
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||
Offering
price:
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The
selling security holders will be offering their shares of common stock at
a price of $0.10 per share, which includes an increase from their purchase
price based on the fact the shares will be liquid and
registered. This is a fixed price at which the selling
security holders may sell their shares until our common stock is quoted on
the OTC Bulletin Board, at which time the shares may be sold at prevailing
market prices or privately negotiated prices.
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8
Shares
outstanding prior to offering:
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24,740,000
shares of common stock.
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Shares
outstanding after offering:
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24,740,000
shares of common stock.
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|
Our
sole executive officer and a director currently own 80.84% of our
outstanding shares of common stock. As a result, he has
substantial control over all matters submitted to our stockholders for
approval.
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||
Market
for the common shares:
|
There
has been no market for our securities. Our common stock is not traded on
any exchange or on the over-the-counter market. After the effective date
of the registration statement relating to this prospectus, we hope to have
a market maker file an application with the FINRA for our common stock to
eligible for trading on the Over-The-Counter Bulletin Board. We
do not yet have a market maker who has agreed to file such
application.
There
is no assurance that a trading market will develop, or, if developed, that
it will be sustained. Consequently, a purchaser of our common stock may
find it difficult to resell the securities offered herein should the
purchaser desire to do so when eligible for public
resale.
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Summary
of Risk Factors:
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||
RISK
FACTORS RELATING TO OUR COMPANY
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||
We
are an exploration stage company, have generated no revenues to date and
have a limited operating history upon which we may be
evaluated.
|
||
We
expect losses in the future because we have no revenue to offset
losses.
|
||
Our
business model is unproven and our success is dependent on our ability to
develop and then expand our customer base.
|
||
We
require additional funding and our operations could be curtailed if we are
unable to obtain required additional funding when needed.
|
||
Our
independent auditor has issued a going concern opinion after reviewing our
financial statements; our ability to continue is dependent on our ability
to raise additional capital and our operations could be curtailed if we
are unable to obtain required additional funding when
needed.
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9
The loss of key executives or
consultants or the failure to hire qualified employees would damage our
business.
|
||
Because
our sole executive officer and directors serve as officers and directors
of other companies engaged in mineral exploration, a potential conflict of
interest could negatively impact our ability to acquire properties to
explore and to run our business.
|
||
If
we do not complete the property lease payments mandated in our agreement
with MinQuest, Inc. (“MinQuest”) we will lose our interest in our property
and our business may fail.
|
||
Because
of our reliance on MinQuest our operations would be severely impacted
should our relationship with MinQuest be terminated for any
reason.
|
||
Because
of the speculative nature of exploration and development, there is a
substantial risk that our business will fail.
|
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We
may not be able to compete with current and potential exploration
companies, some of whom have greater resources and experience than we do
in developing mineral reserves.
|
||
We
may not have the funds to purchase all of the supplies, manpower and
materials we need to begin exploration which could cause us to delay or
suspend operations.
|
||
The
prices of metals are highly volatile and a decrease in metals prices could
result in us incurring losses.
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||
Because
our business involves numerous operating hazards, we may be subject to
claims of a significant size which would cost a significant amount of
funds and resources to rectify. This could force us to cease our
operations, which will cause you a loss of your investment.
|
10
Damage
to the environment could result from our operations. If our
business is involved in one or more of these hazards, we may be subject to
claims of a significant size which could force us to cease our
operations.
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||
It
is possible that there may be native or aboriginal claims to our property,
which could result in us incurring additional expenses to explore our
properties.
|
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Because
access to our mineral claims may be restricted by inclement weather we may
be delayed in our exploration
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Our
principal stockholder, who is our sole executive officer and a director,
owns a controlling interest in our voting stock. Therefore investors will
not have any voice in our management, which could result in decisions
adverse to our general shareholders.
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RISK
FACTORS RELATING TO OUR COMMON STOCK
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We
may, in the future, issue additional common shares, which would reduce
investors’ percent of ownership and may dilute our share
value.
|
||
Our
common stock is subject to the "penny stock" rules of the Securities and
Exchange Commission (“SEC”) and the trading market in our securities is
limited, which makes transactions in our stock cumbersome and may reduce
the value of an investment in our stock.
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||
The
market for penny stocks has experienced numerous frauds and abuses which
could adversely impact investors in our stock.
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The
offering price of our common stock could be higher than the market value,
causing investors to sustain a loss of their
investment.
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State
securities laws may limit secondary trading, which may restrict the states
in which and conditions under which you can sell the shares offered by
this prospectus.
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11
Currently
there is no public market for our securities, and there can be no
assurances that any public market will ever develop or that our common
stock will be quoted for trading and, even if quoted, it is likely to be
subject to significant price fluctuations.
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||
If
a market develops for our shares, sales of our shares relying upon Rule
144 may depress prices in that market by a material amount.
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We
may be exposed to potential risks resulting from new requirements under
Section 404 of the Sarbanes-Oxley Act of 2002.
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Because
we are not subject to compliance with rules requiring the adoption of
certain corporate governance measures, our stockholders have limited
protections against interested director transactions, conflicts of
interest and similar matters.
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The
costs to meet our reporting and other requirements as a public company
subject to the Exchange Act of 1934 will be substantial and may result in
us having insufficient funds to expand our business or even to meet
routine business obligations.
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Use
of proceeds:
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We
will not receive any proceeds from the sale of shares by the selling
security holders.
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12
Summary
Financial Information for the period September 16, 2009 (inception) to April 30,
2010
Statement
of Operations Data
|
||||
Operating
revenues
|
$ | - | ||
Income
(loss) from operations
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$ | (2,865 | ) | |
Net
income (loss)
|
$ | (2,865 | ) |
Balance Sheet Data
:
April
30, 2010
|
||||
Working
capital
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$ | (865 | ) | |
Total
assets
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$ | 3,831 | ||
Total
liabilities
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$ | 4,696 | ||
Stockholders’
Equity
|
$ | (865 | ) |
13
RISK
FACTORS
An
investment in our common stock involves a high degree of risk. You should
carefully consider the following factors and other information in this
prospectus before deciding to invest in our company. If any of the following
risks actually occur, our business, financial condition, results of operations
and prospects for growth would likely suffer. As a result, you could lose all or
part of your investment.
Risk
Factors Relating to Our Company
1. We
are an exploration stage company, have generated no revenues to date and have a
limited operating history upon which we may be evaluated.
We were
incorporated on September 16, 2009, have generated no revenues from operations
to date. We have leased an early stage mineral property but the
property does not have any known resources or reserves. Our only
other meaningful asset is $85,000 in available cash at August 24, 2010. Our
limited operating history
makes it difficult to evaluate
our business on the basis of historical operations. We are an exploration stage
company with no known commercially viable deposits, or “resources”, or
"reserves" on our property. Therefore, determination of the
existence of a resource or
reserve will depend on
appropriate and sufficient exploration work and
the evaluation of legal, economic, and
environmental factors. If we fail to find a commercially viable
deposit on any of our property our financial condition and results of operations
will suffer. If we cannot generate income from the property we will
have to cease operation which will result in the loss of your
investment.
We face
all of the risks inherent in a new business and those risks specifically
inherent in the business of the acquisition, exploration, and if warranted and
feasible, development of natural resource properties, with all of the unforeseen
costs, expenses, problems, and difficulties to which such ventures are subject.
We cannot assure you that we will be able to generate revenues or profits from
operation of our business or that we will be able to generate or sustain
profitability in the future.
2.
We expect losses in the future because we have no revenue to offset
losses.
As
reflected in our financial statements filed in this registration statement, we
are in the development stage formed to carry out the activities described in
this prospectus. As of April 30, 2010, we have incurred a net loss of $2,865 and
used cash in operations of $29. As we have no current revenue, we are
expecting losses over the next 12 months because we do not yet have any revenues
to offset the expenses associated with the development and implementation of our
business plan. We cannot guarantee that we will ever be successful in generating
revenues in the future. We recognize that if we are unable to generate revenues,
we will not be able to earn profits or continue operations. There is
no history upon which to base any assumption as to the likelihood that we will
prove successful, and we can provide investors with no assurance that we will
generate any operating revenues or ever achieve profitable
operations.
14
3. Our
business model is unproven and our success is dependent on our ability to
explore and develop our mineral property.
Our
business model is to generate revenues from the sale of minerals from our leased
exploration property. We cannot guarantee that we will ever be
successful in doing this in order to generate revenues in the future. Our leased
resource property is at a very early stage, and our ability to generate revenue
is unproven. Therefore, it is not possible for us to predict the future level of
production, if any, or if we will be able to effectuate our business plan. We
recognize that if we are unable to generate revenues, we will not be able to
earn profits or continue operations. There is no history upon which
to base any assumption as to the likelihood that we will prove successful, and
we can provide investors with no assurance that we will generate any operating
revenues or ever achieve profitable operations.
4. Our
independent auditor has issued a going concern opinion after reviewing our
financial statements; our ability to continue is dependent on our ability to
raise additional capital and our operations could be curtailed if we are unable
to obtain required additional funding when needed.
We will
be required to expend substantial amounts of working capital in order to explore
and develop our mineral property. We were incorporated on September
16, 2009. Our operations to date were funded entirely from capital raised from
our private offering of securities from April through May 2010 (the “Offering”).
Notwithstanding the Offering, we will continue to require additional financing
to execute our business strategy. We are totally dependent on
external sources of financing for the foreseeable future, of which we have no
commitments. Our failure to raise additional funds in the future will adversely
effect our business operations, and may require us to suspend our operations,
which in turn may result in a loss to the purchasers of our common stock. We are
entirely dependent on our ability to attract and receive additional funding from
either the sale of securities or outside sources such as private investment or a
strategic partner. We currently have no firm agreements or arrangements with
respect to any such financing and there can be no assurance that any needed
funds will be available to us on acceptable terms or at all. The inability to
obtain sufficient funding of our operations in the future could restrict our
ability to grow and reduce our ability to continue to conduct business
operations. After reviewing our financial statements, our independent
auditor issued a going concern opinion and our ability to continue is dependent
on our ability to raise additional capital. If we are unable to obtain necessary
financing, we will likely be required to curtail our development plans which
could cause us to become dormant. Any additional equity financing may involve
substantial dilution to our then existing stockholders.
5. Because
we anticipate our operating expenses will increase prior to our earning
revenues, we may never achieve profitability
Prior to
completion of our exploration stage, we anticipate that we will incur increased
operating expenses without realizing any revenues. Therefore, we expect to incur
significant losses into the foreseeable future. We recognize that if we are
unable to generate significant revenues from the exploration of our mineral
claims we will not be able to earn profits or continue operations. There is no
history upon which to base any assumption as to the likelihood that we will
prove successful, and we can provide investors with no assurance that we will
generate any operating revenues or ever achieve profitable operations. If we are
unsuccessful in addressing these risks, our business will most likely
fail.
15
6. The loss of our sole executive officer
or the failure to hire qualified employees or consultants would damage our
business.
Because
of the highly technical nature of our business, we depend greatly on attracting
and retaining experienced management and highly qualified and trained
personnel. We compete with other companies intensely for qualified
and well trained professionals in our industry. If we cannot hire or retain, and
effectively integrate, a sufficient number of qualified and experienced
professionals, this will have a material adverse effect on our capacity to
sustain and grow our business and develop our products through the clinical
trial process and otherwise.
7. Because
our sole executive officer and directors serve as officers and directors of
other companies engaged in mineral exploration, a potential conflict of interest
could negatively impact our ability to acquire properties to explore and to run
our business.
Our sole
executive officer and directors have other business interests and work for other
mining and mineral exploration companies. Due to time demands placed
on our sole executive officer and directors, and due to the competitive nature
of the exploration business, the potential exists for conflicts of interest to
occur from time to time that could adversely affect our ability to conduct our
business. Our sole executive officer and directors’ full-time employment with
other entities limits the amount of time they can dedicate to us as a director
or officer. Also, our sole executive officer and directors may have a conflict
of interest in helping us identify and obtain the rights to mineral properties
because they may also be considering the same properties. To mitigate these
risks, we will work with several geologists in order to ensure that we are not
overly reliant on any one of our directors to provide us with geological
services. However, we cannot be certain that a conflict of interest
will not arise in the future. To date, there have not been any
conflicts of interest between any of our sole executive officer or directors and
the Company. It is estimated that our sole executive officer will spend one day
per week working on our business.
8. If
we do not complete the property lease payments mandated in our agreement with
MinQuest, Inc. (“MinQuest”) we will lose our interest in our property and our
business may fail.
If we do
not make all of the property lease payments to MinQuest in accordance with our
property agreement we will lose our rights under the lease agreement and may not
be able to continue to execute our business objectives if we are unable to find
an alternate exploration interest. Since our payment obligations are
non-refundable, if we do not make any payments, we will lose any payments
previously made and all our rights to the properties.
9.
Because of our reliance on MinQuest our operations would be severely impacted
should our relationship with MinQuest be terminated for any reason.
Our
property has been acquired from MinQuest. In addition, to date all of
our exploration activity on this property has been undertaken by
MinQuest. As a result, MinQuest has significant knowledge about our
property and it would be very difficult for us to replace MinQuest should our
relationship with them be terminated for any reason. If we default
under any of our obligations to MinQuest, and we do not cure such default,
MinQuest can terminate our agreement. To date, there have not been any conflicts
between the Company and MinQuest.
16
10.
Because of the speculative nature of exploration and development, there is a
substantial risk that our business will fail.
The
search for valuable natural resources on our property is extremely risky as the
exploration for natural resources is a speculative venture involving substantial
risk. Few properties that are explored are ultimately developed into producing
mines. Problems such as unusual or unexpected formations and other conditions
are involved in mineral exploration and often result in unsuccessful exploration
efforts. Because the probability of an individual prospect ever
having reserves is extremely remote, in all probability our properties do not
contain any reserves, and any funds we spent on exploration will probably be
lost. In such a case, we would be unable to complete our business
plan.
Mineral
exploration involves a high degree of risk and exploration projects are
frequently unsuccessful. To the extent that we continue to be
involved in mineral exploration, the long-term success of our operations will be
related to the cost and success of our exploration programs. The risks
associated with mineral exploration include:
·
|
the
identification of potential mineralization based on superficial
analysis;
|
·
|
the
quality of our management and our geological and technical expertise;
and
|
·
|
the
capital available for exploration and
development.
|
Substantial
expenditures are required to determine if a project has economically mineable
mineralization. It may take several years to establish proven and
probable reserves and to develop and construct mining and processing facilities.
Problems such as unusual or unexpected formations and other conditions are
involved in mineral exploration and often result in unsuccessful exploration
efforts. In such a case, we would be unable to develop our
business.
11. We
may not be able to compete with current and potential exploration companies,
some of whom have greater resources and experience than we do in developing
mineral reserves.
The
natural resource market is intensely competitive, highly fragmented and subject
to rapid change. We may be unable to compete successfully with our
existing competitors or with any new competitors. We compete with
many exploration companies which have significantly greater personnel,
financial, managerial, and technical resources than we do. This competition from
other companies with greater resources and reputations may result in our failure
to maintain or expand our business.
12. We
may not have the funds to purchase all of the supplies, manpower and materials
we need to begin exploration which could cause us to delay or suspend
operations.
Competition
and unforeseen limited sources of supplies in the industry could result in
occasional spot shortages of supplies, manpower and certain equipment such as
bulldozers and excavators that we might need to conduct exploration. If there is
a shortage or scarcity, we cannot compete with larger companies in the
exploration industry for supplies, manpower and equipment. In the
event that the prices for such resources rise above our affordability levels, we
may have to delay or suspend operations. In the event we are forced
to limit our exploration activities, we may not find any minerals, even though
our properties may contain mineralized material. Without any minerals we cannot
generate revenues and you may lose your investment.
17
13. The
prices of metals are highly volatile and a decrease in metals prices could
result in us incurring losses.
The
profitability of natural resource operations are directly related to the market
prices of the underlying commodities. The market prices of metals
fluctuate significantly and are affected by a number of factors beyond our
control, including, but not limited to, the rate of inflation, the exchange rate
of the dollar to other currencies, interest rates, and global economic and
political conditions. Price fluctuations in the metals markets from
the time development of a mine is undertaken and the time production can
commence can significantly affect the profitability of a
mine. Accordingly, we may begin to develop a mineral property at a
time when the price of the underlying metals make such exploration economically
feasible and, subsequently, incur losses because metals prices have
decreased. Adverse fluctuations of metals market price may force us
to curtail or cease our business operations.
14.
Because our business involves numerous operating hazards, we may be subject to
claims of a significant size which would cost a significant amount of funds and
resources to rectify. This could force us to cease our operations, which will
cause you a loss of your investment.
Our
operations are subject to the usual hazards inherent in exploring for minerals,
such as general accidents, explosions, chemical exposure, and
craterings. The occurrence of these or similar events could result in
the suspension of operations, damage to or destruction of the equipment involved
and injury or death to personnel. Operations also may be suspended because of
machinery breakdowns, abnormal climatic conditions, failure of subcontractors to
perform or supply goods or services or personnel shortages. The occurrence of
any such contingency would require us to incur additional costs and force us to
cease our operations, which will cause you a loss of your
investment.
Difficulties,
such as unusual or unexpected rock formations encountered by workers but not
indicated on a map, or other conditions may be encountered in the gathering of
samples and information, and could delay our exploration
program. Even though we are at liberty to obtain insurance against
certain risks in such amounts we deem adequate, the nature of those risks is
such that liabilities could over exceed policy limits or be excluded from
coverage. We do not currently carry insurance to protect against
these risks and we may not obtain such insurance in the future. There
are also risks against which we cannot, or may not elect to
insure. The costs, which could be associated with any liabilities,
not covered by insurance or in excess of insurance coverage or compliance with
applicable laws and regulations may cause substantial delays and require
significant capital outlays, thereby hurting our financial position, future
earnings, and/or competitive positions. We may not have enough
capital to continue operations and you will lose your investment.
15.
Damage to the environment could result from our operations. If our
business is involved in one or more of these hazards, we may be subject to
claims of a significant size which could force us to cease our
operations.
Mineral
resource exploration, production and related operations are subject to extensive
rules and regulations of federal, state and local agencies. Failure
to comply with these rules and regulations can result in substantial
penalties. Our cost of doing business may be affected by the
regulatory burden on the mineral industry since the rules and regulations
frequently are amended or interpreted. We cannot predict the future
cost or impact of complying with these laws.
18
Environmental
enforcement efforts with respect to mineral operations have increased over the
years, and it is possible that regulation could expand and have a greater impact
on future mineral exploration operations. Although our management
intends to comply with all legislation and/or actions of local, provincial,
state and federal governments, non-compliance with applicable regulatory
requirements could subject us to penalties, fines and regulatory actions, the
cost of which could harm our results of operations. We cannot be sure
that our proposed business operations will not violate environmental laws in the
future.
Our
operations and property are subject to extensive federal, state, and local laws
and regulations relating to environmental protection, including the generation,
storage, handling, emission, transportation and discharge of materials into the
environment, and relating to safety and health. These laws and regulations may
do any of the following: (i) require the acquisition of a permit or other
authorization before exploration commences, (ii) restrict the types, quantities
and concentration of various substances that can be released into the
environment in connection with exploration activities, (iii) limit or prohibit
mineral exploration on certain lands lying within wilderness, wetlands and other
protected areas, (iv) require remedial measures to mitigate pollution from
former operations and (v) impose
substantial liabilities for pollution resulting from our proposed
operations.
16. It
is possible that there may be native or aboriginal claims to our property, which
could result in us incurring additional expenses to explore our
properties.
Although
we believe that we have the right to explore our property, we cannot
substantiate that there are no native or aboriginal claims to the property.
Native groups have made extensive land claims to large areas of land within
various parts of the United States. The status of such claims is
uncertain, and has not been resolved despite lengthy and expensive court
proceedings. If a native or aboriginal claim is made to our property,
it would negatively affect our ability to explore this property as we would have
to incur significant legal fees protecting our right to explore the property. We
may also have to pay third parties to settle such claims. If it is
determined that there is a legitimate claim to our property then we may be
forced to return this property without adequate consideration. Even
if there is no legal basis for such claim, the costs involved in resolving such
matter may force us to delay or curtail our exploration
completely. When we make the application to commence our exploration
activities, representatives of Native groups may have the right to participate
in, or may be consulted in, review by regulatory authorities of our proposed
mining operations. If this occurs, we may have to incur additional
resources and it may take longer to obtain the required permits.
17. Because
access to our mineral claims may be restricted by inclement weather we may be
delayed in our exploration
Access to
our mineral property may be restricted through some of the year due to weather
in the local area. As a result, any attempt to test or explore the property is
largely limited to the times when weather permits such activities. These
limitations can result in significant delays in exploration efforts. Such delays
can have a significant negative effect on our results of
operations.
19
18. Our
principal stockholder, who is our sole executive officer and director, owns a
controlling interest in our voting stock. Therefore investors will not have any
voice in our management, which could result in decisions adverse to our general
shareholders.
Our
principal shareholder beneficially owns approximately 80.84% of our outstanding
common stock. As a result, this stockholder will have the ability to control
substantially all matters submitted to our stockholders for approval
including:
• election
of our board of directors;
• removal
of any of our directors;
• amendment
of our Articles of
Incorporation or bylaws; and
•
adoption
of measures that could delay or prevent a change in control or impede a merger,
takeover or other business combination involving us.
As a
result of his ownership and position, principal stockholder who is also a
director and our sole executive officer is able to influence all matters
requiring shareholder approval, including the election of directors and approval
of significant corporate transactions. In addition, the future prospect of sales
of significant amounts of shares held by our principal shareholder could affect
the market price of our common stock if the marketplace does not orderly adjust
to the increase in shares in the market and the value of your investment in the
Company may decrease. Management's stock ownership may discourage a
potential acquirer from making a tender offer or otherwise attempting to obtain
control of us, which in turn could reduce our stock price or prevent our
stockholders from realizing a premium over our stock price.
RISK
FACTORS RELATING TO OUR COMMON STOCK
19. We
may, in the future, issue additional common shares, which would reduce
investors’ percent of ownership and may dilute our share value.
Our
Articles of Incorporation authorizes the issuance of 100,000,000 shares of
common stock, par value $.0001 per share, of which 24,740,000 shares are
currently issued and outstanding. The future issuance of common stock may result
in substantial dilution in the percentage of our common stock held by our then
existing shareholders. We may value any common stock issued in the future on an
arbitrary basis. The issuance of common stock for future services or
acquisitions or other corporate actions may have the effect of diluting the
value of the shares held by our investors, and might have an adverse effect on
any trading market for our common stock.
20. Our
sole executive officer and a director owns a controlling interest in our voting
stock and may take actions that are contrary to your interests,
including selling their stock.
Our sole
executive officer, who is also a director, beneficially owns approximately
80.84% of our outstanding common stock. If and when he is able to
sell his shares in the market, such sales by our sole executive officer within a
short period of time could adversely affect the market price of our common stock
if the marketplace does not orderly adjust to the increase in the number of
shares in the market. This will result in a decrease in the value of your
investment in the Company. Management's stock ownership may
discourage a potential acquirer from making a tender offer or otherwise
attempting to obtain control of us, which in turn could reduce our stock price
or prevent our stockholders from realizing a premium over our stock
price.
20
21. Our
common stock is subject to the "penny stock" rules of the Securities and
Exchange Commission (“SEC”) and the trading market in our securities is limited,
which makes transactions in our stock cumbersome and may reduce the value of an
investment in our stock.
The SEC has adopted Rule 15g-9 which
establishes the definition of a "penny stock," for the purposes relevant to us,
as any equity security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt, the
rules require: (i) that a broker or dealer approve a person's account for
transactions in penny stocks; and (ii) the broker or dealer receive from the
investor a written agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve a person's
account for transactions in penny stocks, the broker or dealer must: (i) obtain
financial information and investment experience objectives of the person; and
(ii) make a reasonable determination that the transactions in penny stocks are
suitable for that person and the person has sufficient knowledge and experience
in financial matters to be capable of evaluating the risks of transactions in
penny stocks.
The
broker or dealer must also deliver, prior to any transaction in a penny stock, a
disclosure schedule prescribed by the SEC relating to the penny stock market,
which, in highlight form: (i) sets forth the basis on which the broker or dealer
made the suitability determination; and (ii) that the broker or dealer received
a signed, written agreement from the investor prior to the
transaction.
Generally,
brokers may be less willing to execute transactions in securities subject to the
"penny stock" rules. This may make it more difficult for investors to dispose of
our common stock and cause a decline in the market value of our
stock.
Disclosure
also has to be made about the risks of investing in penny stocks in both public
offerings and in secondary trading and about the commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in the account and
information on the limited market in penny stocks.
Because
we do not intend to pay any cash dividends on our shares of common stock, our
stockholders will not be able to receive a return on their shares unless they
sell them.
We intend
to retain any future earnings to finance the development and expansion of our
business. We do not anticipate paying any cash dividends on our common stock in
the foreseeable future. Unless we pay dividends, our stockholders will not be
able to receive a return on their shares unless they sell them at a price higher
than that which they initially paid for such shares.
21
22. The
market for penny stocks has experienced numerous frauds and abuses which could
adversely impact investors in our stock.
We
believe that the market for penny stocks has suffered from patterns of fraud and
abuse. Such patterns include:
·
|
Control
of the market for the security by one or a few broker-dealers that are
often related to the promoter or
issuer;
|
·
|
Manipulation
of prices through prearranged matching of purchases and sales and false
and misleading press releases;
|
·
|
"Boiler
room" practices involving high pressure sales tactics and unrealistic
price projections by inexperienced sales
persons;
|
·
|
Excessive
and undisclosed bid-ask differentials and markups by selling
broker-dealers; and
|
The
wholesale dumping of the same securities by promoters and broker-dealers after
prices have been manipulated to a desired level, along with the inevitable
collapse of those prices with consequent investor losses.
23. The
offering price of our common stock could be higher than the market value,
causing investors to sustain a loss of their investment.
The price
of our common stock in this offering has not been determined by any independent
financial evaluation, market mechanism or by our auditors, and is therefore, to
a large extent, arbitrary. Our audit firm has not reviewed management's
valuation, and therefore expresses no opinion as to the fairness of the offering
price as determined by our management. As a result, the price of the common
stock in this offering may not reflect the value perceived by the market. There
can be no assurance that the shares offered hereby are worth the price for which
they are offered and investors may therefore lose a portion or all of their
investment.
24. State
securities laws may limit secondary trading, which may restrict the states in
which and conditions under which you can sell the shares offered by this
prospectus.
Secondary
trading in common stock sold in this offering will not be possible in any state
until the common stock is qualified for sale under the applicable securities
laws of the state or there is confirmation that an exemption, such as listing in
certain recognized securities manuals, is available for secondary trading in the
state. If we fail to register or qualify, or to obtain or verify an exemption
for the secondary trading of, the common stock in any particular state, the
common stock could not be offered or sold to, or purchased by, a resident of
that state. In the event that a significant number of states refuse to permit
secondary trading in our common stock, the liquidity for the common stock could
be significantly impacted thus causing you to realize a loss on your
investment.
25. Currently
there is no public market for our securities, and there can be no assurances
that any public market will ever develop or that our common stock will be quoted
for trading and, even if quoted, it is likely to be subject to significant price
fluctuations.
22
There has
not been any established trading market for our common stock, and there is
currently no public market whatsoever for our securities. Additionally, no
public trading can occur until we file and have declared effective a
registration statement with the SEC. There can be no assurances as to whether,
subsequent to registration with the SEC:
·
|
any
market for our shares will develop;
|
·
|
the
prices at which our common stock will trade;
or
|
·
|
the
extent to which investor interest in us will lead to the development of an
active, liquid trading market. Active trading markets generally
result in lower price volatility and more efficient execution of buy and
sell orders for investors.
|
In
addition, our common stock is unlikely to be followed by any market analysts,
and there may be few institutions acting as market makers for our common stock.
Either of these factors could adversely affect the liquidity and trading price
of our common stock. Until our common stock is fully distributed and an orderly
market develops in our common stock, if ever, the price at which it trades is
likely to fluctuate significantly. Prices for our common stock will be
determined in the marketplace and may be influenced by many factors, including
the depth and liquidity of the market for shares of our common stock,
developments affecting our business, including the impact of the factors
referred to elsewhere in these Risk Factors, investor perception of our company
and general economic and market conditions. No assurances can be given
that an orderly or liquid market will ever develop for the shares of our common
stock.
26. If
a market develops for our shares, sales of our shares relying upon Rule 144 may
depress prices in that market by a material amount.
The
majority of the outstanding shares of our common stock held by present
stockholders are "restricted securities" within the meaning of Rule 144 under
the Securities Act of 1933, as amended. As restricted shares, these shares may
be resold only pursuant to an effective registration statement, such as this one
(for the shares registered hereunder) or under the requirements of Rule 144 or
other applicable exemptions from registration under the Act and as required
under applicable state securities laws. On November 15, 2007, the SEC adopted
changes to Rule 144, which, would shorten the holding period for sales by
non-affiliates to six months (subject to extension under certain circumstances)
and remove the volume limitations for such persons. The changes
became effective in February 2008. Rule 144 provides in essence that an
affiliate who has held restricted securities for a prescribed period may, under
certain conditions, sell every three months, in brokerage transactions, a number
of shares that does not exceed 1% of a company's outstanding common stock. The
alternative average weekly trading volume during the four calendar weeks prior
to the sale is not available to our shareholders being that the Over-the-Counter
Bulletin Board (if and when listed thereon) is not an "automated
quotation system" and, accordingly, market based volume limitations are not
available for securities quoted only over the Over-The-Counter Bulletin Board.
As a result of the revisions to Rule 144 discussed above, there is no limit on
the amount of restricted securities that may be sold by a non-affiliate (i.e., a
stockholder who has not been an officer, director or control person for at least
90 consecutive days) after the restricted securities have been held by the owner
for a period of six months, if we have filed our required reports. A sale
under Rule 144 or under any other exemption from the Act, if available, or
pursuant to registration of shares of common stock of present stockholders, may
have a depressive effect upon the price of our common stock in any market that
may develop.
23
27. We
may be exposed to potential risks resulting from new requirements under
Section 404 of the Sarbanes-Oxley Act of 2002.
If
we become registered with the SEC, we will be required, pursuant to
Section 404 of the Sarbanes-Oxley Act of 2002, to include in our annual
report our assessment of the effectiveness of our internal control over
financial reporting We expect to incur significant continuing costs,
including accounting fees and staffing costs, in order to maintain compliance
with the internal control requirements of the Sarbanes-Oxley Act of 2002.
Development of our business will necessitate ongoing changes to our internal
control systems, processes and information systems. Currently, we have no
employees, no products in development, no manufacturing facilities and no
intellectual property rights. As we develop our product, obtain regulatory
approval, hire employees and consultants and seek to protect our intellectual
property rights, our, our current design for internal control over financial
reporting will not be sufficient to enable management to determine that our
internal controls are effective for any period, or on an ongoing basis.
Accordingly, as we develop our business, such development and growth will
necessitate changes to our internal control systems, processes and information
systems, all of which will require additional costs and expenses.
In the
future, if we fail to complete the annual Section 404 evaluation in a timely
manner, we could be subject to regulatory scrutiny and a loss of public
confidence in our internal controls. In addition, any failure to implement
required new or improved controls, or difficulties encountered in their
implementation, could harm our operating results or cause us to fail to meet our
reporting obligations.
28. Because
we are not subject to compliance with rules requiring the adoption of certain
corporate governance measures, our stockholders have limited protections against
interested director transactions, conflicts of interest and similar
matters.
The
Sarbanes-Oxley Act of 2002, as well as rule changes proposed and enacted by the
SEC, the New York and American Stock Exchanges and the Nasdaq Stock Market, as a
result of Sarbanes-Oxley, require the implementation of various measures
relating to corporate governance. These measures are designed to enhance the
integrity of corporate management and the securities markets and apply to
securities which are listed on those exchanges or the Nasdaq Stock Market.
Because we are not presently required to comply with many of the corporate
governance provisions and because we chose to avoid incurring the substantial
additional costs associated with such compliance any sooner than necessary, we
have not yet adopted these measures.
Because
none of our directors are independent, we do not currently have independent
audit or compensation committees. As a result, the director has the ability,
among other things, to determine his own level of compensation. Until we comply
with such corporate governance measures, regardless of whether such compliance
is required, the absence of such standards of corporate governance may leave our
stockholders without protections against interested director transactions,
conflicts of interest and similar matters and investors may be reluctant to
provide us with funds necessary to expand our operations.
24
29. The
costs to meet our reporting and other requirements as a public company subject
to the Exchange Act of 1934 will be substantial and may result in us having
insufficient funds to expand our business or even to meet routine business
obligations.
If we
become a public entity, subject to the reporting requirements of the Exchange
Act of 1934, we will incur ongoing expenses associated with professional fees
for accounting, legal and a host of other expenses for annual reports and proxy
statements. We estimate that these costs will range up to $25,000 per year for
the next few years and will be higher if our business volume and activity
increases but lower during the first year of being public because our overall
business volume will be lower, and we will not yet be subject to the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002. As a result,
we may not have sufficient funds to grow our operations.
THE
OFFERING
This
prospectus relates to the resale by certain selling security holders of the
Company of up to 4,740,000 shares of our common stock. Such shares
were offered and sold by us in our first private placement in April 2010 at a
purchase price of $0.01 per share for 3,500,000 common shares and $0.05 for
1,240,000 common shares in our second private placement in May 2010 pursuant to
the exemptions from registration under the Securities Act provided by Regulation
D and Regulation S of the Securities Act. The price per share increased from one
private placement to the subsequent one as a result of our activities in the
month – we executed the agreement with MinQuest for our leased property and
appointed a geologist as a member of the Board of Directors.
USE
OF PROCEEDS
The
selling stockholders are selling shares of common stock covered by this
prospectus for their own account. We will not receive any of the proceeds from
the resale of these shares. We have agreed to bear the expenses relating to the
registration of the shares for the selling stockholders.
DETERMINATION
OF OFFERING PRICE
The
selling stockholders will be offering the shares of common stock being covered
by this prospectus at a fixed price of $0.10 per share until a market develops
and thereafter at prevailing market prices or privately negotiated prices. The
fixed price of $0.10 has been determined as the selling price based upon the
original purchase price paid by the selling shareholders of $0.01 for 3,500,000
common shares and $0.05 for 1,240,000 common shares plus an increase based on
the fact the shares will be liquid and registered. The price per share increased
from one private placement to the subsequent one as a result of our activities
in the month – we executed the agreement with MinQuest for our leased property
and appointed a geologist as a member of the Board of Directors.
Such
offering price does not have any relationship to any established criteria of
value, such as book value or earnings per share. Because we have no significant
operating history, the price of our common stock is not based on past earnings,
nor is the price of our common stock indicative of the current market value of
the assets owned by us. No valuation or appraisal has been prepared for our
business and potential business expansion. Our common stock is presently not
traded on any market or securities exchange and we have not applied for listing
or quotation on any public market.
25
FORWARD-LOOKING
STATEMENTS
This
prospectus contains forward-looking statements which relate to future events or
our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as “may”, “should”, “expects”,
“plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or
“continue” or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled “Risk Factors,” that may cause our or our industry’s actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking
statements.
While
these forward-looking statements, and any assumptions upon which they are based,
are made in good faith and reflect our current judgment regarding the direction
of our business, actual results will almost always vary, sometimes materially,
from any estimates, predictions, projections, assumptions or other future
performance suggested herein. Except as required by applicable law, including
the securities laws of the United States, we do not intend to update any of the
forward-looking statements to conform these statements to actual
results.
SELLING
SECURITY HOLDERS
The
following table sets forth the shares beneficially owned, as of August 24, 2010,
by the selling security holders prior to the offering contemplated by this
prospectus, the number of shares each selling security holder is offering by
this prospectus and the number of shares which each would
own beneficially if
all such offered shares are
sold.
Beneficial
ownership is determined in accordance with SEC rules. Under these rules, a
person is deemed to be a beneficial owner of a security if that person has or
shares voting power, which includes the power to vote or direct the voting of
the security, or investment power, which includes the power to vote or direct
the voting of the security. The person is also deemed to be a beneficial owner
of any security of which that person has a right to acquire beneficial ownership
within 60 days. Under the SEC rules, more than one person may be deemed to be a
beneficial owner of the same securities, and a person may be deemed to be a
beneficial owner of securities as to which he or she may not have any pecuniary
beneficial interest. Except as noted below, each person has sole voting and
investment power.
None of
the selling security holders is a registered broker-dealer or an affiliate of a
registered broker-dealer. Each of the selling security holders has
acquired his, her or its shares pursuant to a private placement solely for
investment and not with a view to or for resale or distribution of such
securities. The shares were offered and sold to the selling security
holders at a purchase price of $0.01 and $0.05 per share in a fully subscribed
private placement held from April through May 2010, pursuant to the exemption
from the registration under the Securities Act provided by Regulation D and
Regulation S of the Securities Act. The price per share increased
from one private placement to the subsequent one as a result of our activities
in the month – we executed the agreement with MinQuest for our leased property
and appointed a geologist to the Board of Directors.
None of
the selling security holders are affiliates or controlled by our affiliates and
none of the selling security holders are now or were at any time in the past an
officer or director of ours or any of any of our predecessors or
affiliates.
26
The
percentages below are calculated based on 24,740,000 shares of our common stock
issued and outstanding as of August 24, 2010. We do not have any outstanding
options, warrants or other securities exercisable for or convertible into shares
of our common stock.
Common
Shares owned by the Selling Security
|
Number
of Shares Offered
by
Selling Security
|
Number
of Shares and Percent
of
Total Issued and Outstanding
Held
After the Offering
|
||||||||||||||
Name
of Selling Security Holders
|
Holder | Holder |
#
of Shares
|
%
of Class
|
||||||||||||
Wende
Luddy
|
10,000 | 10,000 | 0 | * | ||||||||||||
Pramod
Sharma
|
10,000 | 10,000 | 0 | * | ||||||||||||
Jasmine
Basrai
|
10,000 | 10,000 | 0 | * | ||||||||||||
Monica
Bennett
|
10,000 | 10,000 | 0 | * | ||||||||||||
Sawtander
Sangha
|
10,000 | 10,000 | 0 | * | ||||||||||||
Carron
Burden
|
10,000 | 10,000 | 0 | * | ||||||||||||
Serena
Yu-Fang Liao
|
10,000 | 10,000 | 0 | * | ||||||||||||
Ema
Rosales
|
10,000 | 10,000 | 0 | * | ||||||||||||
Karampal
Basrai
|
10,000 | 10,000 | 0 | * | ||||||||||||
Maria
Theresa Garcia
|
10,000 | 10,000 | 0 | * | ||||||||||||
Charito
Deguzman
|
10,000 | 10,000 | 0 | * | ||||||||||||
Gina
Sommerfeld
|
10,000 | 10,000 | 0 | * | ||||||||||||
Joseph
Ralla
|
10,000 | 10,000 | 0 | * | ||||||||||||
Ernie
Sommerfeld
|
10,000 | 10,000 | 0 | * | ||||||||||||
Barinder
Johal
|
100,000 | 100,000 | 0 | * | ||||||||||||
Candice
Coombes
|
100,000 | 100,000 | 0 | * | ||||||||||||
Cindy
Bains
|
100,000 | 100,000 | 0 | * | ||||||||||||
Tej
Purba
|
100,000 | 100,000 | 0 | * | ||||||||||||
Colin
Worth
|
100,000 | 100,000 | 0 | * | ||||||||||||
Harjinder
Bains
|
100,000 | 100,000 | 0 | * | ||||||||||||
Gillian
Allen
|
100,000 | 100,000 | 0 | * | ||||||||||||
Mary
Coombes
|
100,000 | 100,000 | 0 | * | ||||||||||||
David
Uppal
|
100,000 | 100,000 | 0 | * | ||||||||||||
Jason
Bains
|
100,000 | 100,000 | 0 | * | ||||||||||||
Harjinder
Gill
|
100,000 | 100,000 | 0 | * | ||||||||||||
Scott
Praill
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Brian
Uppal
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Terry
Uppal
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Paul
Uppal
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Pol
Brisset
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Fred
Coombes
|
500,000 | 500,000 | 0 | 2.02 | % | |||||||||||
Pamela
Gill
|
500,000 | 500,000 | 0 | 2.02 | % |
* Represents less than one percent of
the total number of shares of common stock outstanding as of the date of this
filing.
27
We may
require the selling security holders to suspend the sales of the securities
offered by this prospectus upon the occurrence of any event that makes any
statement in this prospectus, or the related registration statement, untrue in
any material respect, or that requires the changing of statements in these
documents in order to make statements in those documents not misleading. We will
file a post-effective amendment to this registration statement to reflect any
material changes to this prospectus.
PLAN
OF DISTRIBUTION
There has
been no market for our securities. Our common stock is not traded on
any exchange or on the over-the-counter market. After the effective date of the
registration statement relating to this prospectus, we hope to have a market
maker file an application with FINRA for our common stock to be eligible for
trading on the Over the Counter Bulletin Board. We do not yet have a market
maker who has agreed to file such application. The selling security
holders will be offering the shares of common stock being covered by this
prospectus at a fixed price of $0.10per share until a market develops and
thereafter at prevailing market prices or privately negotiated prices. The fixed
price of $0.10 was determined as the selling price based upon the original
purchase price paid by the selling shareholders of $0.01 for 3,500,000 common
shares and $0.05 for 1,240,000 common shares plus an increase based on the fact
the shares will be liquid and registered. The price per share
increased from one private placement to the subsequent one as a result of our
activities in the month – we executed the agreement with MinQuest for our leased
property and appointed a geologist to the Board of Directors.
.
Once a
market has been developed for our common stock, the shares may be sold or
distributed from time to time by the selling security holders directly to one or
more purchasers or through brokers or dealers who act solely as agents, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, at negotiated prices or at fixed prices, which may be
changed. The distribution of the shares may be effected in one or more of the
following methods: (a) ordinary brokerage transactions and transactions in which
the broker solicits purchasers; (b) privately negotiated transactions; (c)
market sales (both long and short to the extent permitted under the federal
securities laws); (d) at the market to or through market makers or into an
existing market for the shares; (e) through transactions in options, swaps or
other derivatives (whether exchange listed or otherwise); and (f) a combination
of any of the aforementioned methods of sale.
In the
event of the transfer by any of the selling security holders of its common
shares to any pledgee, donee or other transferee, we will amend this prospectus
and the registration statement of which this prospectus forms a part by the
filing of a post-effective amendment in order to have the pledgee, donee or
other transferee in place of the selling security holder who has transferred
his, her or its shares.
28
In
effecting sales, brokers and dealers engaged by the selling security holders may
arrange for other brokers or dealers to participate. Brokers or dealers may
receive commissions or discounts from a selling security holder or, if any of
the broker-dealers act as an agent for the purchaser of such shares, from a
purchaser in amounts to be negotiated which are not expected to exceed those
customary in the types of transactions involved. Broker-dealers may agree with a
selling security holder to sell a specified number of the shares of common stock
at a stipulated price per share. Such an agreement may also require the
broker-dealer to purchase as principal any unsold shares of common stock at the
price required to fulfill the broker-dealer commitment to the selling security
holder if such broker-dealer is unable to sell the shares on behalf of the
selling security holder. Broker-dealers who acquire shares of common stock as
principal may thereafter resell the shares of common stock from time to time in
transactions which may involve block transactions and sales to and through other
broker-dealers, including transactions of the nature described above. Such sales
by a broker-dealer could be at prices and on terms then prevailing at the time
of sale, at prices related to the then-current market price or in negotiated
transactions. In connection with such resales, the broker-dealer may pay to or
receive from the purchasers of the shares commissions as described
above.
The
selling security holders and any broker-dealers or agents that participate with
the selling security holders in the sale of the shares of common stock may be
deemed to be "underwriters" within the meaning of the Securities Act in
connection with these sales. In that event, any commissions received by the
broker-dealers or agents and any profit on the resale of the shares of common
stock purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.
From time
to time, any of the selling security holders may pledge shares of common stock
pursuant to the margin provisions of customer agreements with brokers. Upon a
default by a selling security holder, their broker may offer and sell the
pledged shares of common stock from time to time. Upon a sale of the shares of
common stock, the selling security holders intend to comply with the prospectus
delivery requirements under the Securities Act by delivering a prospectus to
each purchaser in the transaction. We intend to file any amendments or other
necessary documents in compliance with the Securities Act which may be required
in the event any of the selling security holders defaults under any customer
agreement with brokers.
To the
extent required under the Securities Act, a post effective amendment to this
registration statement will be filed disclosing the name of any broker-dealers,
the number of shares of common stock involved, the price at which the common
stock is to be sold, the commissions paid or discounts or concessions allowed to
such broker-dealers, where applicable, that such broker-dealers did not conduct
any investigation to verify the information set out or incorporated by reference
in this prospectus and other facts material to the transaction.
We and
the selling security holders will be subject to applicable provisions of the
Exchange Act and the rules and regulations under it, including, without
limitation, Rule 10b-5 and, insofar as a selling security holder is a
distribution participant and we, under certain circumstances, may be a
distribution participant, under Regulation M. All of the foregoing may affect
the marketability of the common stock.
All
expenses of the registration statement including, but not limited to, legal,
accounting, printing and mailing fees are and will be borne by us. Any
commissions, discounts or other fees payable to brokers or dealers in connection
with any sale of the shares of common stock will be borne by the selling
security holders, the purchasers participating in such transaction, or
both.
29
Any
shares of common stock covered by this prospectus which qualify for sale
pursuant to Rule 144 under the Securities Act, as amended, may be sold under
Rule 144 rather than pursuant to this prospectus.
Penny
Stock Regulations
You
should note that our stock is a penny stock. The SEC has adopted Rule 15g-9
which generally defines "penny stock" to be any equity security that has a
market price (as defined) less than $5.00 per share or an exercise price of less
than $5.00 per share, subject to certain exceptions. Our securities are covered
by the penny stock rules, which impose additional sales practice requirements on
broker-dealers who sell to persons other than established customers and
"accredited investors". The term "accredited investor" refers generally to
institutions with assets in excess of $5,000,000 or individuals with a net worth
in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly
with their spouse. The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document in a form prepared by the SEC which
provides information about penny stocks and the nature and level of risks in the
penny stock market. The broker-dealer also must provide the customer with
current bid and offer quotations for the penny stock, the compensation of the
broker-dealer and its salesperson in the transaction and monthly account
statements showing the market value of each penny stock held in the customer'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. In addition, the penny stock rules
require that prior to a transaction in a penny stock not otherwise exempt from
these rules, the broker-dealer must make a special written determination that
the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common stock.
Blue
Sky Restrictions on Resale
If a
selling security holder wants to sell shares of our common stock under this
registration statement in the United States, the selling security holders will
also need to comply with state securities laws, also known as “Blue Sky laws,”
with regard to secondary sales. All states offer a variety of
exemption from registration for secondary sales. Many states, for
example, have an exemption for secondary trading of securities registered under
Section 12(g) of the Securities Exchange Act of 1934 or for securities of
issuers that publish continuous disclosure of financial and non-financial
information in a recognized securities manual, such as Standard &
Poor’s. The broker for a selling security holder will be able to
advise a selling security holder which states our common stock is exempt from
registration with that state for secondary sales.
Any
person who purchases shares of our common stock from a selling security holder
under this registration statement who then wants to sell such shares will also
have to comply with Blue Sky laws regarding secondary sales.
When the
registration statement becomes effective, and a selling security holder
indicates in which state(s) he desires to sell his shares, we will be able to
identify whether it will need to register or will rely on an exemption there
from.
30
DESCRIPTION
OF SECURITIES
The
following description of our capital stock is a summary and is qualified in its
entirety by the provisions of our Articles of Incorporation which has been filed
as an exhibit to our registration statement of which this prospectus is a
part.
Common
Stock
We are
authorized to issue 100,000,000 shares of common stock, par value $0.0001, of
which 24,740,000 shares are issued and outstanding as of August 24,
2010. Each holder of shares of our common stock is entitled to one
vote for each share held of record on all matters submitted to the vote of
stockholders, including the election of directors. The holders of
shares of common stock have no preemptive, conversion, subscription or
cumulative voting rights. There is no provision in our Articles of
Incorporation or By-laws that would delay, defer, or prevent a change in control
of our Company.
Preferred
Stock
There is
no preferred stock authorized.
Warrants
and Options
Currently,
there are no warrants, options or other convertible securities
outstanding.
No expert
or counsel named in this prospectus as having prepared or certified any part of
this prospectus or having given an opinion upon the validity of the securities
being registered or upon other legal matters in connection with the registration
or offering of the common stock was employed on a contingency basis or had, or
is to receive, in connection with the offering, a substantial interest, directly
or indirectly, in the registrant or any of its parents or subsidiaries. Nor was
any such person connected with the registrant or any of its parents,
subsidiaries as a promoter, managing or principal underwriter, voting trustee,
director, officer or employee.
DESCRIPTION
OF BUSINESS
History
Tundra
Gold Corp. (“the Company”) was incorporated under the name Titan Gold Corp. on
September 16, 2009 under the laws of the State of Nevada. On February
25, 2010 we amended our articles of incorporation to change its name to Tundra
Gold Corp. We were established to operate in the acquisition,
exploration, and if warranted and feasible, development of natural resource
properties. We currently have leased one mineral exploration property located in
Nevada.
31
Strategy
We are a
natural resource exploration company with an objective of acquiring, exploring,
and if warranted and feasible, exploiting natural resource properties. Our
primary focus in the natural resource sector is gold. Though it is
possible to take a resource property that hosts a viable ore deposit into mining
production, the costs and time frame for doing so are considerable, and the
subsequent return on investment for our shareholders would be very long term
indeed. We therefore anticipate optioning or selling any ore bodies that we may
discover to a major mining company. Many major mining companies obtain their ore
reserves through the purchase of ore bodies found by junior exploration
companies. Although these major mining companies do some exploration work
themselves, many of them rely on the junior resource exploration companies to
provide them with future deposits for them to mine. By optioning or selling a
deposit found by us to these major mining companies, it would provide an
immediate return to our shareholders without the long time frame and cost of
putting a mine into operation ourselves, and it would also provide future
capital for the company to continue operations.
32
Marietta
Property
33
Acquisition
of Interest
On May
18, 2010 we executed a property lease agreement with MinQuest, Inc. (“MinQuest”)
whereby we leased certain unpatented mineral claims from MinQuest collectively
referred to as the Marietta Property (the “Marietta”). The
Marietta is located in Mineral County, Nevada and currently consists of five
unpatented claims. The lease agreement is for a period of 20 years
with annual lease payments of $5,000 due on May 15 of each
year. There are no minimum annual exploration expenditures required
under the agreement. However, any exploration programs undertaken by
us during the lease period shall carryforward and be credited against any future
property option agreement should such a property option agreement be executed
between us and MinQuest. Upon execution of the Marietta Agreement, we
paid MinQuest $5,000 as well as reimbursed MinQuest $756 relating to property
holding costs.
Under the
agreement with MinQuest, all of our payment obligations are
non-refundable. If we do not make any payments under the agreement we
will lose any payments made and all our rights to the
property. MinQuest has retained a 3% royalty of the aggregate
proceeds received by the Company from any smelter or other purchaser of any
ores, concentrates, metals or other material of commercial value produced from
the property, minus the cost of transportation of the ores, concentrates or
metals, including related insurance, and smelting and refining charges,
including penalties. All of the $5,000 annual lease payments under
the agreement shall be treated as advance royalty payments and will be an offset
to the production royalty due until the total amount paid to Lessor has been
recouped.
The
Company may use MinQuest for its mineral exploration expertise on the property.
Furthermore, both the Company and MinQuest have the right to assign, sell,
mortgage or pledge their rights in the agreement or on the
property.
The
agreement will terminate if the Company fails to comply with any of its
obligations under the agreement and fails to cure such alleged breach. If the
Company gives notice that it denies a default has occurred, the matter shall be
determined finally through such means of dispute resolution as such matter has
been subjected to by either party. The agreement can be terminated by
the Company by providing MinQuest with 60 days written notice.
Description
and Location of the Marietta Property
The
Marietta Property is located in Mineral County, Nevada and currently consists of
5 unpatented claims. The town of Mina is 50 km away and Tonopah is
120 km north.
Exploration
History of the Marietta Property
Exploration
history includes some small unrecorded production from the property that likely
occurred between the early 1900’s and 1940’s. Modern exploration was
confined to work conducted by American Gold Resources (AGR) from 1989 to
1992. AGR completed a total of 59 drill holes testing the above
referenced resource area. Of this amount, 33 holes were drilled on 50
feet centers while the remaining holes were drilled on 200 feet
centers. Drilling to a depth of 350 feet has defined a mineralized
zone that is mostly hosted within a graben of calcareous sandstone with quartz
veins. A graben is an elongated depression between geologic
faults and a vein is a narrow mass of rock intersecting other rocks, and
filling inclined or vertical fissures not corresponding with the
stratification. Further work is needed to determine the strike and
extent and depth of the mineralization.
34
Geology
of the Marietta Property
The
Marietta Property is located within the Walker Lane trend. The Walker
Lane is a linear north-northwest trending depression extending some 800 km (500
miles) north from the Garlock Fault-Las Vegas area to south-central Oregon.
Within it are Walker, Goose, and Pyramid Lakes. This trough is part of the
Walker Lane Fault Zone, a major tectonic system that includes Owens and Death
Valleys and several prominent faults, and is the site of many contemporary
earthquakes. Located at the juncture of two contrasting tectonic styles, the
Sierra Nevada and the Basin and Range, the Walker Lane region is deforming in a
complex way by both extensional and transcurrent (sliding) fault
movements
The
Walker Lane shear zone straddles the border between Nevada and California and
has a long history of exploration and mining, dating back to the discovery of
the famous Comstock Lode in the late 1850s. The Walker Lane is notable for its
numerous occurrences of volcanic-hosted epithermal gold and silver
deposits. The project area covers sheared and brecciated silciclastic
rocks of the Triassic Excelsior Formation intruded by a porphyryitic
quartz-monzonite of Laramide age. The mineralized zone is mostly
hosted within a graben of calcareous sandstone with quartz veins.
Current
State of Exploration
The
Marietta claims presently do not have any mineral resources or reserves. There
is no mining plant or equipment located within the property boundaries.
Currently, there is no power supply to the mineral claims.
Geological
Exploration Program
The
Company is in the process of compiling all historic drilling and sampling
results. These results will be evaluated to determine if one or more
precious metals may exist within the property boundaries. Our planned
program includes compilation of all activities to the present with the goal of
producing an outline of mineralized areas that will guide further exploration
drilling. However, this program is exploratory in nature and no
minable reserves may ever be found.
Intellectual
Property
We do not
have any intellectual property rights.
Competition
The
mineral exploration industry is intensely competitive, highly fragmented and
subject to rapid change. We may be unable to compete successfully
with our existing competitors or with any new competitors. We compete
with many exploration companies which have significantly greater personnel,
financial, managerial, and technical resources than we do. This
competition from other companies with greater resources and reputations may
result in our failure to maintain or expand our business.
35
Governmental
Regulations
Mineral
resource exploration, production and related operations are subject to extensive
rules and regulations of federal, state and local agencies. We may be
required to obtain work permits, post bonds and perform remediation work for any
physical disturbance to the land in order to comply with these
laws. While our planned exploration program budgets for regulatory
compliance, there is a risk that new regulations could increase our costs of
doing business and prevent us from carrying out exploration
program.
Failure
to comply with these rules and regulations can result in substantial
penalties. Our cost of doing business may be affected by the
regulatory burden on the mineral industry. We believe that compliance with the
laws will not adversely affect our business operations.
Environmental
enforcement efforts with respect to mineral operations have increased over the
years, and it is possible that regulation could expand and have a greater impact
on future mineral exploration operations. Although our management
intends to comply with all legislation and/or actions of local, provincial,
state and federal governments, non-compliance with applicable regulatory
requirements could subject us to penalties, fines and regulatory actions, the
cost of which could harm our results of operations. We cannot be sure
that our proposed business operations will not violate environmental laws in the
future.
Employees
We
currently have no employees. All functions including development, strategy,
negotiations and administration are currently being provided by our sole
executive officer on a voluntary basis.
Property
The
Company currently maintains its executive offices on a shared basis at 200 S.
Virginia, 8th
Floor, Reno, Nevada, 89501. We have a one year lease that commenced March 1,
2010 at a rate of $169 per month.
LEGAL
PROCEEDINGS
There are
no pending legal proceedings to which we are a party or in which any director,
officer or affiliate of ours, any owner of record or beneficially of more than
5% of any class of our voting securities, or security holder is a party adverse
to us or has a material interest adverse to us. The Company’s
property is not the subject of any pending legal proceedings.
MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Market
Information
There has
been no market for our securities. Our common stock is not traded on any
exchange or on the over-the-counter market. After the effective date of the
registration statement relating to this prospectus, we hope to have a market
maker file an application with the FINRA for our common stock to be eligible for
trading on the Over The Counter Bulletin Board. We do not yet have a market
maker who has agreed to file such application. There is no assurance that a
trading market will develop, or, if developed, that it will be sustained.
Consequently, a purchaser of our common stock may find it difficult to resell
the securities offered herein should the purchaser desire to do so when eligible
for public resale.
36
DIVIDEND
POLICY
We have
not declared or paid dividends on our common stock since our formation, and we
do not anticipate paying dividends in the foreseeable
future. Declaration or payment of dividends, if any,
in the future, will be at the
discretion of our Board of Directors and will depend
on our then current
financial condition, results of operations,
capital requirements and other
factors deemed relevant by the board of directors.
There are no contractual restrictions on our ability to declare or pay
dividends.
SHARE
CAPITAL
Security
Holders
As of
August 24, 2010, there were 24,740,000 common shares issued and outstanding,
which were held by 33 stockholders of record.
Transfer
Agent
We have
not engaged a transfer agent to serve as transfer agent for shares of our common
stock. Until we engage such a transfer agent, we will be responsible
for all record-keeping and administrative functions in connection with the
shares of our common stock.
Admission
to Quotation on the OTC Bulletin Board
We intend
to have a market maker file an application for our common stock to be quoted on
the OTC Bulletin Board. However, we do not have a market maker that has agreed
to file such application. If our securities are not quoted on the OTC
Bulletin Board, a security holder may find it more difficult to dispose of, or
to obtain accurate quotations as to the market value of our securities. The OTC
Bulletin Board differs from national and regional stock exchanges in that
it:
(1) is
not situated in a single location but operates through communication of bids,
offers and confirmations between broker-dealers, and
(2)
securities admitted to quotation are offered by one or more broker-dealers
rather than the "specialist" common to stock exchanges.
To
qualify for quotation on the OTC Bulletin Board, an equity security must have
one registered broker-dealer, known as the market maker, willing to list bid or
sale quotations and to sponsor the company listing. If they meet the
qualifications for trading securities on the OTC Bulletin Board our securities
will trade on the OTC Bulletin Board. We may not now or ever qualify for
quotation on the OTC Bulletin Board. We currently have no market maker who is
willing to list quotations for our securities.
37
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Certain
statements contained in this prospectus, including statements regarding the
development and expansion of our business, our intent, belief or current
expectations, primarily with respect to the future operating performance of
Tundra Gold Corp., and the products we plan to offer and other statements
contained herein regarding matters that are not historical facts, are
"forward-looking" statements. Future filings with the SEC, future press releases
and future oral or written statements made by us or with our approval, which are
not statements of historical fact, may contain forward-looking statements,
because such statements include risks and uncertainties, actual results may
differ materially from those expressed or implied by such forward-looking
statements.
All
forward-looking statements speak only as of the date on which they are
made. We undertake no obligation to update such statements to reflect
events that occur or circumstances that exist after the date on which they are
made.
Overview
The
Company was established to operate in the acquisition, exploration, and if
warranted and feasible, development of natural resource
properties. The Company has leased one property in
Nevada. We intend on using the proceeds of $97,000 from the sale of
4,740,000 shares of our common stock, which were offered in a fully subscribed
private placements from April through May 2010, to finance our activities. We
believe that such funds will be sufficient to fund our operating expenses over
the next twelve months.
Plan
of Operation
Over the
next twelve months, the Company intends to focus on compiling all historic
drilling and sampling results for the Marietta Property. These
results will be evaluated to determine if one or more precious metals may exist
within the property boundaries. Our planned program includes
compilation of all activities to the present with the goal of producing an
outline of mineralized areas that will guide further exploration
drilling. However, this program is exploratory in nature and no
minable reserves may ever be found.
The
Company estimates that it will utilize approximate minimum of $60,000 in the
next 12 months to implement its activities. The following chart indicates how we
would utilize such funds:
Purpose
|
Amount
|
|||
G&A
including expert consultant fees
|
$ | 5,000 | ||
Initial
property assessment
|
$ | 30,000 | ||
Legal
and accounting
|
$ | 15,000 | ||
Cost
of operating as a public company
|
$ | 10,000 | ||
Total
|
$ | 60,000 |
38
Results
of Operations
As of
April 30, 2010, the Company had $1,971 in cash. Subsequent to April 30, 2010, we
received $62,000 from the collection of subscriptions receivable and $35,000
from a private placement. We believe that such funds will be
sufficient to effectuate our business plan over the next twelve months. In the
future, we will need to seek additional capital for the purpose of financing the
exploration and development of our mineral property.
Revenues
The
Company is in its development stage and did not generate any revenues during the
period from September 16, 2009 (inception) through April 30, 2010.
Total
operating expenses
During
period from September 16, 2009 (inception) to April 30, 2010, the total
operating expenses were $2,865, which include legal and professional accounting
fees associated with filing this registration statement.
Net
loss
During
the period from September 16, 2009 (Inception) through April 30, 2010, the
Company had a net loss of $2,865.
Liquidity
and Capital Resources
As of
April 30, 2010, the Company had a cash balance of $1,971. Subsequent to April
30, 2010 the Company collected $62,000 from the collections of subscriptions
receivable and $35,000 from a private placement. The Company believes that such
funds will be sufficient to fund its expenses over the next twelve
months. There can be no assurance that additional capital will be
available to the Company. The Company currently has no agreements, arrangements
or understandings with any person to obtain funds through bank loans, lines of
credit or any other sources. Since the Company has no such
arrangements or plans currently in effect, its inability to raise funds for the
above purposes will have a severe negative impact on its ability to remain a
viable company.
Going
Concern Considerations
The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
and commitments in the normal course of business. The Company has
incurred a net loss of $2,865 for the period from September 16, 2010 (inception)
to April 30, 2010, and has no sales.
39
The
Company's ability to continue as a going concern is dependent on its ability to
develop its natural resource properties and ultimately achieve profitable
operations and to generate sufficient cash flow from financing and operations to
meet its obligations as they become payable. The Company expects that it will
need approximately $60,000 to fund its operations during the next twelve months
which will include property lease payments, initial assessment of its property,
costs associated with maintaining an office, and professional, legal and
accounting expenses associated with our becoming a reporting issuer under the
Securities Act of 1934. The Company has raised a total of $99,000
since inception and a result, the Company currently has sufficient cash to fund
its planned operations for the next twelve months. However, in order
to develop its property, the Company will need to obtain financing in the
future. Management plans to seek additional capital through private
placements and public offerings of its common stock. Although there
are no assurances that management’s plans will be realized, management believes
that the Company will be able to continue operations in the
future. Accordingly, no adjustment relating to the recoverability and
classification of recorded asset amounts and the classification of liabilities
has been made to the accompanying financial statements in anticipation of the
Company not being able to continue as a going concern.
If the
Company were unable to continue as a going concern, then substantial adjustments
would be necessary to the carrying values of assets, the reported amounts of its
liabilities, the reported expenses, and the balance sheet classifications
used.
Off-Balance
Sheet Arrangements
We have
no off-balance sheet arrangements.
DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Directors
and Executive Officers
Set forth
below are the names, ages and present principal occupations or employment, and
material occupations, positions, offices or employments for the past five years
of our current directors and executive officers.
Name and Business Address
|
Age
|
Position
|
||
Gary
Basrai
|
58
|
CEO,
President and Director
|
||
Bill
Eastwood
|
77
|
Director
|
Gary Basrai is the founder of
the Company and has been its President, Chief Executive Officer, Chief Financial
Officer, Chief Accounting Officer, Treasurer, Secretary and Director since
inception. He is also the sole executive officer of Ranger Gold Corp., an OTCB
trading company. He is an accomplished businessman who has owned and operated
several businesses in the Fremont, California area for over 30 years. He
is the former President of the Alameda County Pharmacist Association and a
current Board member of the Alameda Alliance for Health, a company which
provides health care coverage to over 100,000 children and
adults. Mr. Basrai holds a Doctorate of Pharmacy from the UOP School
of Pharmacy.
40
Bill Eastwood joined the Board
of Directors on May 15, 2010. He is a geologist with over 40 years of
industry experience. Since 1994 he has been a self-employed
geological consultant focusing on planning, permitting and supervising mineral
exploration drilling programs in Nevada and Arizona. He holds
Bachelor and Master’s Degrees in geology from the University of Kansas (1956 and
1958 respectively) and has done graduate study at the University of Wyoming
(1962 – 1966).
There are
no familial relationships among any of our officers or
directors. None of our directors or officers has been affiliated with
any company that has filed for bankruptcy within the last five
years. We are not aware of any proceedings to which any of our
officers or directors, or any associate of any such officer or director, is a
party adverse to us or any of our or has a material interest adverse to us or
any of our subsidiaries.
Each
director of the Company serves for a term of one year or until such director’s
successor is duly elected and is qualified. Each officer serves, at
the pleasure of the board of directors, for a term of one year and until such
officer’s successor is duly elected and is qualified.
Code
of Ethics; Financial Expert
We do not
currently have a Code of Ethics applicable to our principal executive, financial
and accounting officers. We do not have a “financial expert” on the board or an
audit committee or nominating committee.
Potential
Conflicts of Interest
Since we
do not have an audit or compensation committee comprised of independent
directors, the functions that would have been performed by such committees are
performed by our directors. Thus, there is a potential conflict of
interest in that our directors and officers have the authority to determine
issues concerning management compensation and audit issues that may affect
management decisions. We are not aware of any other conflicts of
interest with any of our executives or directors.
Director
Independence
We are
not subject to listing requirements of any national securities exchange or
national securities association and, as a result, we are not at this time
required to have our board comprised of a majority of “independent directors.”
We do not believe that any of our directors currently meet the definition of
“independent” as promulgated by the rules and regulations of the American Stock
Exchange.
EXECUTIVE
COMPENSATION
Summary
Compensation
Since our
incorporation on September 16, 2009 the only compensation paid to any of our
officers or directors is to Bill Eastwood. Commencing with his
appointment on May 15, 2010, Mr. Eastwood began receiving $500 a month for
serving as a Director. Although we have a service agreement with Mr.
Eastwood for his compensation, we do not have employment agreements with any of
our directors or our sole executive officer. We have no pension,
health, annuity, bonus, insurance, stock options, profit sharing or similar
benefit plans.
41
Since our
incorporation on September 16, 2010, no stock options or stock appreciation
rights were granted to any of our directors or our sole executive
officer. We have no equity incentive plans.
Outstanding
Equity Awards
Since our
incorporation on September 16, 2010, neither our sole executive officer nor any
of our directors has held unexercised options, stock that had not vested, or
equity incentive plan awards.
Compensation
of Directors
Commencing
with his appointment on May 15, 2010, Mr. Eastwood began receiving $500 a month
for serving in the capacity as a director of the Company. In accordance with the
terms of the Service Agreement, he is to receive such amount in advance on a
quarterly basis for as long as he is a director. As of August 24, 2010 we have
paid Mr. Eastwood $1,750.
No
arrangements are presently in place regarding compensation to directors for
their services as for committee participation or special
assignments.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table lists, as of August 24, 2010, the number of shares of common
stock of our company that are beneficially owned by (i) each person or entity
known to our company to be the beneficial owner of more than 5% of the
outstanding common stock; (ii) each named executive officer and director of our
Company; and (iii) all officers and directors as a group. Information relating
to beneficial ownership of common stock by our principal shareholders and
management is based upon information furnished by each person using “beneficial
ownership” concepts under the rules of the SEC. Under these rules, a person is
deemed to be a beneficial owner of a security if that person has or shares
voting power, which includes the power to vote or direct the voting of the
security, or investment power, which includes the power to vote or direct the
voting of the security. The person is also deemed to be a beneficial owner of
any security of which that person has a right to acquire beneficial ownership
within 60 days. Under the SEC rules, more than one person may be deemed to be a
beneficial owner of the same securities, and a person may be deemed to be a
beneficial owner of securities as to which he or she may not have any pecuniary
beneficial interest. Except as noted below, each person has sole voting and
investment power.
The
percentages below are calculated based on 24,740,000 shares of our common stock
issued and outstanding as of August 24, 2010. We do not have any
outstanding options, warrants or other securities exercisable for or convertible
into shares of our common stock. Unless otherwise indicated, the
address of each person listed is c/o Tundra Gold Corp., 800 S. Virginia, 8th
Floor, Reno, Nevada, 89501. Our telephone number is (775)
398-3012.
42
Name of Beneficial Owner
|
Title Of Class
|
Amount and Nature of Beneficial
Ownership
|
Percent of Class
|
Gary
Basrai
|
Common
|
20,000,000
|
80.84%
|
Bill
Eastwood
|
Common
|
0
|
0%
|
Directors
and officers, as a group (2 persons)
|
Common
|
20,000,000
|
80.84%
|
There are
no family relationships among our officers and directors.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
On
September 16, 2009 by action taken by our board of directors, we issued
20,000,000 shares of our common stock to Gary Basrai, at the purchase price of
$0.0001 per share for the aggregate consideration of $2,000. This
transaction was conducted in reliance upon an exemption from registration
provided under Section 4(2) of the Securities Act of 1933, as
amended. Mr. Basrai is the founder, sole executive
officer and a director of our Company and had access to all of the information
which would be required to be included in a registration statement, and the
transaction did not involve a public offering.
Our
director, Bill Eastwood, is a party to a Service Agreement with us which
provides that he is to receive $500 per month, payable in advance on a quarterly
basis. In accordance with the terms of the Service Agreement, he is to receive
such amount for as long as he is a director.
Other
than as set forth above, there are no transactions during the last two years, or
proposed transactions, to which we were or are to be a party, in which any of
the following persons had or is to have a direct or indirect material
interest:
·
|
EXPENSES
OF ISSUANCE AND DISTRIBUTION
We have
agreed to pay all expenses incident to the offering and sale to the public of
the shares being registered other than any commissions and discounts of
underwriters, dealers or agents and any transfer taxes, which shall be borne by
the selling security holders. The expenses which we are paying are set forth in
the following table. All of the amounts shown are estimates except the SEC
registration fee.
Nature of Expense
|
Amount
|
|||
Accounting
fees and expenses*
|
$ | 1,500.00 | ||
SEC
registration fee
|
$ | 33.80 | ||
Legal fees and other
expenses*
|
$ | 10,000.00 | ||
Total
|
$ | 11,533.80 |
*Estimated
Expenses.
43
LEGAL
MATTERS
David
Lubin & Associates, PLLC has opined on the validity of the shares of common
stock being offered hereby.
EXPERTS
The
financial statements included in this prospectus and in the registration
statement have been audited by Robison, Hill & Co. an independent registered
public accounting firm, to the extent and for the period set forth in their
report appearing elsewhere herein and in the registration statement, and are
included in reliance upon such report given upon the authority of said firm as
experts in auditing and accounting.
INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Our
By-laws provide to the fullest extent permitted by law, our directors or
officers, former directors and officers, and persons who act at our request as a
director or officer of a body corporate of which we are a shareholder or
creditor shall be indemnified by us. We believe that the indemnification
provisions in our By-laws are necessary to attract and retain qualified persons
as directors and officers.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 (the
"Act" or "Securities Act") may be permitted to directors, officers or persons
controlling us pursuant to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the SEC, such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable.
WHERE
YOU CAN FIND MORE INFORMATION
We have
filed a registration statement on Form S-1 under the Securities Act with the SEC
for the securities offered hereby. This prospectus, which constitutes a part of
the registration statement, does not contain all of the information set forth in
the registration statement or the exhibits and schedules which are part of the
registration statement. For additional information about us and our securities,
we refer you to the registration statement and the accompanying exhibits and
schedules. Statements contained in this prospectus regarding the contents of any
contract or any other documents to which we refer are not necessarily complete.
In each instance, reference is made to the copy of the contract or document
filed as an exhibit to the registration statement, and each statement is
qualified in all respects by that reference. Copies of the registration
statement and the accompanying exhibits and schedules may be inspected without
charge (and copies may be obtained at prescribed rates) at the public reference
facility of the SEC at Room 1024, 100 F Street, N.E. Washington, D.C.
20549.
You can
request copies of these documents upon payment of a duplicating fee by writing
to the SEC. You may call the SEC at 1-800-SEC-0330 for further information on
the operation of its public reference rooms. Our filings, including the
registration statement, will also be available to you on the Internet web site
maintained by the SEC at http://www.sec.gov.
44
TUNDRA
GOLD CORP.
(An
Exploration Stage Company)
-:-
INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS’S REPORT
April 30,
2010
Contents
|
Page
|
||
Report
of Independent Registered Public Accountants
|
F -
1
|
||
Balance
Sheet
|
|||
April
30, 2010
|
F -
2
|
||
Statement
of Operations for the
|
|||
from
September 16, 2009 (inception) to April 30, 2010
|
F -
3
|
||
Statement
of Stockholders’ Equity
|
|||
Since
September 16, 2009 (inception) to April 30, 2010
|
F -
4
|
||
Statements
of Cash Flows for the
|
|||
from
September 16, 2009 (inception) to April 30, 2010
|
F -
5
|
||
Notes
to Financial Statements
|
F -
7
|
||
|
||||
ROBISON,
HILL & CO.
|
Certified
Public Accountants
|
|||
A
PROFESSIONAL CORPORATION
|
||||
BRENT
M. DAVIES, CPA
|
||||
DAVID
O. SEAL, CPA
|
||||
W.
DALE WESTENSKOW, CPA
|
||||
BARRY
D. LOVELESS, CPA
|
||||
STEPHEN
M. HALLEY, CPA
|
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS
Tundra
Gold Corp.
(An
Exploration Stage Company)
We have
audited the accompanying balance sheets of Tundra Gold Corp. (an exploration
stage company) as of April 30, 2010 and the related statements of operations,
and cash flows for the period since September 16, 2009 (inception) to April 30,
2010, and the statement of stockholder’s equity since September 16, 2009
(inception) to April 30, 2010. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included
consideration 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’s
internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
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 financial statements referred to above present fairly, in all
material respects, the financial position of Tundra Gold Corp. (an exploration
stage company) as of April 30, 2010 and the results of its operations and its
cash flows for the period since September 16, 2009 (inception) to April 30,
2010, in conformity with accounting principles generally accepted in the United
States of America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has incurred net losses of approximately $2,865 and has
no source of revenues, which raise substantial doubt about its ability to
continue as a going concern. Management’s plans in regard to these
matters are also described in Note 2. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
_/s/
ROBISON, HILL & CO._____
Certified
Public Accountants
Salt Lake
City, Utah
August
25, 2010
F -
1
TUNDRA GOLD CORP.
(An
Exploration Stage Company)
BALANCE
SHEET
April
30,
|
||||
2010
|
||||
ASSETS:
|
||||
Current
Assets:
|
||||
Cash
|
$
|
1,971
|
||
Prepaid
expenses
|
1,860
|
|||
Total
Current Assets
|
3,831
|
|||
|
||||
Total
Assets
|
$
|
3,831
|
||
LIABILITIES
& STOCKHOLDERS’ EQUITY (DEFICIT):
|
||||
Current
Liabilities:
|
||||
Accounts
Payable and Accrued Liabilities
|
$
|
4,696
|
||
Total
Current Liabilities
|
4,696
|
|||
Stockholders’
Equity (Deficit):
|
||||
Common
Stock, Par Value $.0001
|
||||
Authorized
100,000,000 shares,
|
||||
Issued
23,500,000 shares at April 30, 2010
|
2,350
|
|||
Paid-In
Capital
|
34,650
|
|||
Subscriptions
receivable
|
(35,000
|
)
|
||
Deficit
Accumulated Since Inception of Exploration Stage
|
(2,865
|
)
|
||
|
||||
Total
Stockholders’ Equity (Deficit)
|
(865
|
)
|
||
Total
Liabilities and Stockholders’ Equity (Deficit)
|
$
|
3,831
|
The
accompanying notes are an integral part of these financial
statements.
F -
2
TUNDRA
GOLD CORP.
(An
Exploration Stage Company)
STATEMENT
OF OPERATIONS
Cumulative
|
||||
Since
|
||||
September
16, 2009
|
||||
Inception
of
|
||||
Exploration
|
||||
Stage
to April 30, 2010
|
||||
Revenues
|
$
|
—
|
||
Cost
of Revenues
|
—
|
|||
Gross
Margin
|
—
|
|||
Expenses:
|
||||
General
and Administrative
|
2,865
|
|||
Net
Loss
|
$
|
(2,865
|
)
|
|
Basic
and Diluted loss per
|
||||
Share
|
$
|
(0.00
|
)
|
|
Weighted
Average Shares
|
||||
Outstanding
|
3,778,761
|
|||
The
accompanying notes are an integral part of these financial
statements.
F -
3
TUNDRA
GOLD CORP.
(An
Exploration Stage Company)
STATEMENT
OF STOCKHOLDERS’ EQUITY (DEFICIT)
Deficit
|
||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||
During
|
||||||||||||||||||||||||
Common
Stock
|
Paid-In
|
Subscriptions
|
Exploration
|
|||||||||||||||||||||
Shares
|
Par
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||
Balance
at September 16, 2009
|
||||||||||||||||||||||||
(inception)
|
— | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||
Common
Stock Issued to Founder
|
||||||||||||||||||||||||
at
$0.001 per share, March 19, 2010
|
20,000,000 | 2,000 | — | — | — | 2,000 | ||||||||||||||||||
Common
Stock Issued at $0.01
|
||||||||||||||||||||||||
per
share, April 16, 2010
|
3,500,000 | 350 | 34,650 | (35,000 | ) | — | — | |||||||||||||||||
Net
Loss
|
— | — | — | — | (2,865 | ) | (2,865 | ) | ||||||||||||||||
Balance
April 30, 2010
|
23,500,000 | $ | 2,350 | $ | 34,650 | $ | (35,000 | ) | $ | (2,865 | ) | $ | (865 | ) |
The
accompanying notes are an integral part of these financial
statements.
F -
4
TUNDRA
GOLD CORP.
(An
Exploration Stage Company)
STATEMENT
OF CASH FLOWS
Cumulative
|
||||
Since
|
||||
September
16, 2009
|
||||
Inception
of
|
||||
Exploration
|
||||
Stage
to April 30, 2010
|
||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||
Net
Loss
|
$
|
(2,865
|
)
|
|
Adjustments
to Reconcile Net Loss to Net
|
||||
Cash
Used in Operating Activities:
|
||||
Change
in Operating Assets and Liabilities:
|
||||
(Increase)
Decrease in Prepaid Expenses
|
(1,860
|
)
|
||
Increase
(Decrease) in Accounts Payable
and Accrued Liabilities
|
4,696
|
|||
Net
Cash Used in Operating Activities
|
(29
|
)
|
||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||
Net
Cash Used in Investing Activities
|
—
|
|||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||
Proceeds
from Sale of Common Stock
|
37,000
|
|||
Subscriptions
Receivable
|
(35,000
|
)
|
||
Net
Cash Provided by Financing Activities
|
2,000
|
|||
Net
(Decrease) Increase in
|
||||
Cash
and Cash Equivalents
|
1,971
|
|||
Cash
and Cash Equivalents
|
||||
at
Beginning of Period
|
—
|
|||
Cash
and Cash Equivalents
|
||||
at
End of Period
|
$
|
1,971
|
F -
5
TUNDRA
GOLD CORP.
(An
Exploration Stage Company)
STATEMENT
OF CASH FLOWS
(Continued)
Cumulative
|
||||
Since
|
||||
September
16, 2009
|
||||
Inception
of
|
||||
Exploration
|
||||
Stage
to April 30, 2010
|
||||
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
|
||||
Cash
paid during the year for:
|
||||
Interest
|
— | |||
Income
taxes
|
— |
The
accompanying notes are an integral part of these financial
statements.
F -
6
NOTE 1 –
NATURE OF BUSINESS AND OPERATIONS
Organization
and Basis of Presentation
Tundra
Gold Corp. (“the Company”) was incorporated under the name Titan Gold Corp. on
September 16, 2009 under the laws of the State of Nevada. On February
25, 2010 the Company amended its articles of incorporation to change its name to
Tundra Gold Corp. The accompanying financial statements have been
prepared in U.S. dollars and in accordance with accounting principles generally
accepted in the United States on a going concern basis.
Nature
of Operations
The
Company has no products or services as of April 30, 2010. The Company
was established to operate in the acquisition, exploration, and if warranted and
feasible, development of natural resource properties.
NOTE 2 –
ABILITY TO CONTINUE AS A GOING CONCERN
The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
and commitments in the normal course of business. The Company has
incurred a net loss of $2,865 for the period from September 16, 2010 (inception)
to April 30, 2010, and has no sales.
The
Company's ability to continue as a going concern is dependent on its ability to
develop its natural resource properties and ultimately achieve profitable
operations and to generate sufficient cash flow from financing and operations to
meet its obligations as they become payable. The Company expects that it will
need approximately $60,000 to fund its operations during the next twelve months
which will include property lease payments, initial assessment of its property,
costs associated with maintaining an office, and professional, legal and
accounting expenses associated with our becoming a reporting issuer under the
Securities Act of 1934. The Company has raised a total of $99,000
(including $62,000 subsequent to April 30, 2010) since inception and a result,
the Company currently has sufficient cash to fund its planned operations for the
next twelve months. However, in order to develop its property, the
Company will need to obtain financing in the future. Management plans
to seek additional capital through private placements and public offerings of
its common stock. Although there are no assurances that management’s
plans will be realized, management believes that the Company will be able to
continue operations in the future. Accordingly, no adjustment
relating to the recoverability and classification of recorded asset amounts and
the classification of liabilities has been made to the accompanying financial
statements in anticipation of the Company not being able to continue as a going
concern.
If the
Company were unable to continue as a going concern, then substantial adjustments
would be necessary to the carrying values of assets, the reported amounts of its
liabilities, the reported expenses, and the balance sheet classifications
used.
NOTE 3 –
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Management’s Estimates and
Assumptions
The
preparation of financial statements in conformity with generally accepted
accounting principles requires the Company’s management to make estimates and
assumptions that affect the amounts reported in these financial statements and
notes. Significant areas requiring the use of estimates relate to accrued
liabilities. Management believes the estimates utilized in preparing
these financial statements are reasonable and prudent and are based on
management’s best knowledge of current events and actions the Company may
undertake in the future. Actual results could differ from those
estimates.
Cash and Cash
Equivalents
For
purposes of the statement of cash flows, the Company considers all highly liquid
debt instruments purchased with a maturity of three months or less to be cash
equivalents to the extent the funds are not being held for investment
purposes.
F -
7
Foreign
Currency
The
Company’s functional currency is the U.S. dollar and to date has undertaken all
of its transactions in U.S. dollars. Any transaction gains and losses that may
occur will be included in the statement of operations as they
occur.
Concentration of Credit
Risk
The
Company has no off-balance-sheet concentrations of credit risk such as foreign
exchange contracts, options contracts or other foreign hedging arrangements. The
Company maintains all of its cash balances with one financial institution in the
form of a demand deposit.
Loss per
Share
Net
income (loss) per share is computed by dividing the net income by the weighted
average number of shares outstanding during the period. As of April 30, 2010,
the company had no outstanding common stock options or warrants
Comprehensive
Income
The
Company has adopted ASC 220, “Reporting Comprehensive Income”, which establishes
standards for reporting and display of comprehensive income, its components and
accumulated balances. The Company has disclosed this information on its
Statement of Operations. Comprehensive income is comprised of net income (loss)
and all changes to capital deficit except those resulting from investments by
owners and distribution to owners.
Property Holding
Costs
Holding
costs to maintain a property on a care and maintenance basis are expensed in the
period they are incurred. These costs include security and maintenance expenses,
lease and claim fees payments, and environmental monitoring and reporting
costs.
Exploration and Development
Costs
Mineral
property interests include optioned, leased, and acquired mineral development
and exploration stage properties. The amount capitalized related to a mineral
property interest represents its fair value at the time it was optioned or
acquired, either as an individual asset or as a part of a business combination.
The value of such assets is primarily driven by the nature and amount of
mineralized material believed to be contained in such properties. Exploration
costs are expensed as incurred and development costs are capitalized if proven
and probable reserves exist and the property is a commercially minable property.
Mine development costs incurred either to develop new ore deposits, expand the
capacity of operating mines, or to develop mine areas substantially in advance
of current production are capitalized. Costs incurred to maintain assets on a
standby basis are charged to operations. Costs of abandoned projects are charged
to operations upon abandonment. The Company evaluates, at least quarterly, the
carrying value of capitalized mineral interests costs and related property,
plant and equipment costs, if any, to determine if these costs are in excess of
their net realizable value and if a permanent impairment needs to be recorded.
The periodic evaluation of carrying value of capitalized costs and any related
property, plant and equipment costs are based upon expected future cash flows
and/or estimated salvage value.
Fair Value of Financial
Instruments
The
carrying value of the Company's financial instruments, including prepaid
expenses, and accounts payable and accrued liabilities at April 30, 2010
approximates their fair values due to the short-term nature of these financial
instruments.
F -
8
New Accounting
Pronouncements
ASC 805
In
December 2007, the FASB issued ASC 805, “Business Combinations”. Among
other things, ASC 805 establishes principles and requirements for how the
acquirer in a business combination (i) recognizes and measures in its financial
statements the identifiable assets acquired, the liabilities assumed, and any
non-controlling interest in the acquired business; (ii) recognizes and measures
the goodwill acquired in the business combination or a gain from a bargain
purchase; and (iii) determines what information to disclose to enable users of
the financial statements to evaluate the nature and financial effects of the
business combination. ASC 805 was effective for fiscal years beginning on or
after December 15, 2008. This standard will affect the Company’s accounting
treatment for any future business combinations.
ASC
815-10
In March
2008, the FASB issued guidance, included in ASC 815-10 “Derivatives and Hedging,”
which seeks to enhance disclosure about how and why a company uses
derivatives; how derivative instruments are accounted for and how derivatives
affect a company’s financial position, financial performance and cash flows.
This Statement was effective for financial statements issued for fiscal years
and interim periods beginning after November 15, 2008. This Statement
encourages, but does not require, comparative disclosures for earlier periods at
initial adoption. The adoption of this statement did not have a material effect
on the Company’s reported financial position or results of
operations.
ASC
815-40
In June
2008, the FASB ratified guidance which is now part of ASC 815-40, “Contracts in Entity’s Own
Equity”. The objective of this issue is to provide guidance for
determining whether an equity-linked financial instrument (or embedded feature)
is indexed to an entity’s own stock. This issue applies to any freestanding
financial instrument or embedded feature that has all the characteristics of a
derivative instrument or an instrument which may be potentially settled in an
entity’s own stock regardless of whether the instrument possess derivative
characteristics. This issue provides a two-step approach to assist in making
these determinations and is effective for financial statements issued for fiscal
years beginning after December 15, 2008. The adoption of this statement did not
have a material effect on the Company’s reported financial position or results
of operations.
ASC 820
In April
2009, the FASB issued additional disclosure requirements related to fair values,
which are included in ASC 820, “Interim Disclosures about Fair Value
of Financial Instruments.” The provisions require disclosures about fair
value of financial instruments for interim reporting periods of publicly traded
companies as well as in annual financial statements. The required disclosures
were effective for interim reporting periods ending after June 15, 2009. The
adoption of the provisions did not have a material impact on the Company’s
statements of financial position, results of operations and cash
flows.
ASC 855
In May
2009, the FASB issued FASB ASC 855, “Subsequent Events”. FASB ASC
855 incorporates accounting and disclosure requirements related to subsequent
events into U.S. GAAP. The requirements of FASB ASC 855 for subsequent-events
accounting and disclosure are not significantly different from those in existing
accounting standards, which the Company has historically followed for financial
reporting purposes. As a result, the adoption of this guidance did not have any
material impact on the financial statements. The Company has evaluated
subsequent events through the filing date of these financial
statements.
F -
9
ASC 105
In July
2009, the FASB issued new guidance relating to the FASB Accounting Standards
Codification at FASB
ASC 105, as the single source of authoritative nongovernmental U.S. generally
accepted accounting principles (GAAP). The codification is effective for interim
periods ending after September 15, 2009. All existing accounting standards were
superseded as described in ASC 105. All other accounting literature not included
in the Codification is non-authoritative. The adoption of ASC 105 did not impact
the Company’s results of operations, financial position or cash
flows.
ASU
2009-05
In August
2009, the FASB issued ASU No. 2009-05, “Measuring Liabilities at Fair
Value,” or ASU 2009-05, which amends ASC 820 to provide clarification of
a circumstances in which a quoted price in an active market for an identical
liability is not available. A reporting entity is required to measure fair value
using one or more of the following methods: 1) a valuation technique that uses
a) the quoted price of the identical liability when traded as an asset or b)
quoted prices for similar liabilities (or similar liabilities when traded as
assets) and/or 2) a valuation technique that is consistent with the principles
of ASC 820. ASU 2009-05 also clarifies that when estimating the fair value of a
liability, a reporting entity is not required to adjust to include inputs
relating to the existence of transfer restrictions on that liability. The
adoption of this ASU did not have an impact on the Company’s financial
statements.
ASU No.
2009-06
In
September 2009, FASB issued ASU No. 2009-06, “Income Taxes (Topic 740) –
Implementation Guidance on Accounting for Uncertainty in Income Taxes and
Disclosure Amendments for Nonpublic Entities. This update is to
address the need for additional implementation guidance on accounting for
uncertainty in income taxes. The implementation guidance will apply
to financial statements on nongovernmental entities that are presented in
conformity with U.S. GAAP. The effective date is for entities that
are currently applying the standards for accounting for uncertain income tax
positions, the guidance and disclosure amendments are effective for financial
statements issued for interim and annual periods ending after September 15,
2009. For those entities that have deferred the application of
accounting for uncertainty in income taxes in accordance with paragraph
740-10-65-1(e), the guidance and disclosure amendments are effective upon
adoption of those standards. The adoption of this standard did not
have a material effect on the Company’s financial statements.
ASU No.
2009-9
In
September 2009, FASB issued ASU No. 2009-09, “Accounting for Investments –
Equity Method and Joint Ventures and Accounting for Equity-Based Payments to
Non-Employees. This update is an amendment to ASC 323-10-S99 and
505-50-S99. The amendment to ASC 323-10-S99 provides guidance on the
accounting by an investor for stock-based compensation based on the investor’s
stock granted to employees of an equity method investee. Investors
that are SEC registrants should classify any income or expense resulting from
application of this guidance in the same income statement caption as the equity
in earnings (or losses) of the investee. The amendment to ASC 505-50-S99
clarifies the accounting by the grantee or grantor in transactions involving
equity instruments granted to other than employees if the accounting does not
reflect the same commitment date or similar values. The adoption of
this standard did not have a material effect on the Company’s financial
statements.
F -
10
ASU No.
2010-01
In
January 2010, the FASB issued ASU No. 2010-01 “Accounting for Distributions to
Shareholders with Components of Stock and Cash” with Equity (Topic
505). The objective of this update is to address diversity in
practice related to the accounting for a distribution to shareholders that
offers them the ability to elect to receive their entire distribution in cash or
shares of equivalent value with a potential limitation on the total amount of
cash that shareholders can elect to receive in
aggregate. Historically, some entities have accounted for the stock
portion of the distribution as a new share issuance that is reflected in earning
per share (“EPS”) prospectively. Other entities have accounted for
the stock portion of the distribution as a stock dividend by retroactively
restating shares outstanding and EPS for all periods presented. The
amendments in this update clarify that the stock portion of a distribution to
shareholders that allows them to elect to receive cash or shares with a
potential limitation on the total amount of cash that all shareholders can elect
to receive in the aggregate is considered a share issuance, rather than a stock
dividend, thus eliminating the diversity in practice. The amendments
in this Update are effective for interim and annual periods ending on or after
December 15, 2009, and should be applied on a retrospective
basis. The adoption of ASU 2010-01 did not have a material
impact on the Company’s financial statements.
ASU No.
2010-06
In
January 2010, the FASB issued ASU, on codification, Fair value Measurements and
Disclosures (Topic 820-10) improving disclosures about fair value
measurements. This update provides amendments to Topic 820 that will
provide more robust disclosures about (1) the different classes of assets and
liabilities measured at fair value, (2) the valuation techniques and inputs
used, (3) the activity in Level 3 fair value measurements, and (4) the transfers
between Level 1, 2, and 3. The standard adds new disclosure and
clarifies existing disclosure requirements. The new standard requires
disclosures of the fair value of financial instruments for interim reporting
periods of publicly traded companies in addition to the annual disclosure
required at year-end. The provisions of the new standard are
effective for the interim periods ending after June 15, 2009. The
adoption of ASU 2010-06 has been reflected in Company’s financial
statements.
APB 14-1 (ASC
470)
In May
2008, FASB issued FASB Staff Position ("FSP") APB 14-1, "Accounting for
Convertible Debt Instruments That May Be Settled in Cash upon Conversion
(Including Partial Cash Settlement)" ("FSP APB 14-1"). FSP APB 14-1
clarifies that convertible debt instruments that may be settled in cash upon
either mandatory or optional conversion (including partial cash settlement) are
not addressed by paragraph 12 of APB Opinion No. 14, "Accounting for Convertible
Debt and Debt issued with Stock Purchase Warrants." Additionally, FSP
APB 14-1 specifies that issuers of such instruments should separately account
for the liability and equity components in a manner that will reflect the
entity's nonconvertible debt borrowing rate when interest cost is recognized in
subsequent periods. FSP APB 14-1 is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years. The adoption of APB 14-1
did not have a material impact on the Company’s financial
statements.
F -
11
ASC No.
2010-03
In
January 2010, FASB issued an Accounting Standard Update, ASC No. 2010-03, on Oil
and Gas. The objective of the amendments included in this update is
to align the oil and gas reserve estimation and disclosure requirements of
Extractive Activities—Oil and Gas (Topic 932) with the requirements in the
Securities and Exchange Commission's final rule, Modernization of the Oil and
Gas Reporting Requirements (the Final Rule). The Final Rule was issued on
December 31, 2008. The amendments to Topic 932 affect entities that
engage in oil- and gas producing activities, including entities that extract
saleable hydrocarbons, in the solid, liquid, or gaseous state, from oil sands,
shale, coal-beds, or other nonrenewable natural resources that are intended to
be upgraded into synthetic oil or gas, and activities undertaken with a view to
such extraction. The amendments to Topic 932 are effective for annual reporting
periods ending on or after December 31, 2009. An entity should apply the
adoption of the amendments as a change in accounting principle inseparable from
a change in estimate. The amendments to Topic 932 specify the required
disclosures for the effect of adoption. Early application is not
permitted. An entity that became subject to the disclosure requirements of Topic
932 due to the change to the definition of significant oil- and gas-producing
activities is permitted to apply the disclosure provisions of Topic 932 in
annual periods beginning after December 31, 2009. The new SEC and FASB
authoritative guidance became effective for the Company’s 2009 Form 20 F and has
been prospectively adopted as of December 31, 2009. The new authoritative
guidance did not have a material impact on the Company’s financial
statements.
NOTE 4
– MINERAL PROPERTY INTERESTS
Marietta
Property
Subsequent
to year end, on May 18, 2010, the Company executed a property lease agreement
with MinQuest, Inc. (“MinQuest”) whereby the Company leased certain unpatented
mineral claims from MinQuest collectively referred to as the Marietta Property
(the “Marietta”). The Marietta Property is located in Mineral
County, Nevada and currently consists of five unpatented claims. The
lease agreement is for a period of 20 years with annual lease payments of $5,000
due on May 15 of each year. There are no minimum annual exploration
expenditures required under the agreement. However, any exploration
programs undertaken by the Company during the lease period shall carryforward
and be credited against any future property option agreement should such a
property option agreement be executed between the Company and
MinQuest. Upon execution of the Marietta Agreement, the Company paid
MinQuest $5,000 as well as reimbursed MinQuest $756 relating to property holding
costs.
Under the
agreement with MinQuest, all of our payment obligations are
non-refundable. If we do not make any payments under the agreement we
will lose any payments made and all our rights to the
property. MinQuest has retained a 3% royalty of the aggregate
proceeds received by the Company from any smelter or other purchaser of any
ores, concentrates, metals or other material of commercial value produced from
the property, minus the cost of transportation of the ores, concentrates or
metals, including related insurance, and smelting and refining charges,
including penalties. All of the annual lease payments under the
agreement shall be treated as advance royalty payments and will be an offset to
the production royalty due until the total amount paid to MinQuest has been
recouped
The
Company may use MinQuest for its mineral exploration expertise on the property.
Furthermore, both the Company and MinQuest have the right to assign, sell,
mortgage or pledge their rights in the agreement or on the
property.
The
agreement will terminate if the Company fails to comply with any of its
obligations under either agreement and fails to cure such alleged breach. If the
Company gives notice that it denies a default has occurred, the matter shall be
determined finally through such means of dispute resolution as such matter has
been subjected to by either party. The agreement can be terminated by
the Company by providing MinQuest with 60 days written notice.
F -
12
NOTE 5 -
INCOME TAXES
Deferred
tax assets of the Company are as follows:
2010
|
||||
Non-capital
losses carried forward
|
1,000 | |||
Less:
valuation allowance
|
(1,000 | ) | ||
Deferred
tax asset recognized
|
- |
A
valuation allowance has been recorded to reduce the net benefit recorded in the
financial statements related to these deferred tax assets. The valuation
allowance is deemed necessary as a result of the uncertainty associated with the
ultimate realization of these deferred tax assets.
The
provision for income tax differs from the amount computed by applying statutory
federal income tax rate of 34% to the net loss for the year. The
sources and effects of the tax differences are as follows:
2010
|
||||
Computed
expected tax benefit
|
1,000 | |||
Change
in valuation allowance
|
(1,000 | ) | ||
Income
tax provision
|
- |
As of
April 30, 2010, the Company had a net operating loss carryforward for income tax
reporting purposes of approximately $2,900 which expire in 2030.
NOTE 6 -
COMMON STOCK TRANSACTIONS
On March
19, 2010 the Company issued 20,000,000 shares of common stock to the founder of
the Company at $0.0001 per share for total proceeds of $2,000.
On April
26, 2010 the Company sold 3,500,000 shares of common stock to private investors
at $.01 per share for gross proceeds of $35,000.
NOTE 7 -
COMMITMENTS AND CONTINGENCIES
On April
1, 2010 the Company entered into a one year lease for its shared office at a
rate of $169 per month.
NOTE 8 –
SUBSEQUENT EVENT
On May
28, 2010, the Company completed a private placement of 1,240,000 common shares
at $0.05 per share for a total offering price of $62,000.
F -
13
PART
II - INFORMATION NOT REQUIRED IN PROSPECTUS
OTHER
EXPENSES OF ISSUANCE AND DISTRIBUTION
The
following table sets forth the expenses in connection with the issuance and
distribution of the securities being registered hereby. All such
expenses will be borne by the Company; none shall be borne by any selling
security holders.
Securities
and Exchange Commission registration fee
|
$ | 33.80 | ||
Legal
fees and miscellaneous expenses (*)
|
$ | 10,000.00 | ||
Accounting
fees and expenses (*)
|
$ | 1,500.00 | ||
Total
(*)
|
$ | 11,533.80 |
(*)
Estimated Expenses.
INDEMNIFICATION
OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
Our
officers and directors are indemnified as provided by the Nevada Revised
Statutes and our bylaws.
Under the
Nevada Revised Statutes, director immunity from liability to a company or its
shareholders for monetary liabilities applies automatically unless it is
specifically limited by a company's Articles of Incorporation. Our
Articles of Incorporation do not specifically limit our directors'
immunity. Excepted from that immunity are: (a) a willful failure to
deal fairly with the company or its stockholders in connection with a matter in
which the director has a material conflict of interest; (b) a violation of
criminal law, unless the director had reasonable cause to believe that his or
her conduct was lawful or no reasonable cause to believe that his or her conduct
was unlawful; (c) a transaction from which the director derived an improper
personal profit; and (d) willful misconduct.
Our
bylaws provide that we will indemnify our directors and officers to the fullest
extent permitted by Nevada law; provided, however, that we may modify the extent
of such indemnification by individual contracts with our directors
and officers; and, provided, further, that we shall not be required to indemnify
any director or officer in connection with
any proceeding, or part thereof, initiated by such person unless such
indemnification: (a) is expressly required to be made by law, (b) the
proceeding was authorized by our board of directors, (c) is provided by us, in
our sole discretion, pursuant to the powers vested in us under Nevada law or (d)
is required to be made pursuant to the bylaws.
Our
bylaws also provide that we may indemnify a director or former director of
subsidiary corporation and we may indemnify our officers, employees or agents,
or the officers, employees or agents of a subsidiary corporation and the heirs
and personal representatives of any such person, against all expenses incurred
by the person relating to a judgment, criminal charge, administrative action or
other proceeding to which he or she is a party by reason of being or having been
one of our directors, officers or employees.
Insofar
as indemnification for liabilities arising under the Securities Act may be
permitted to our directors, officers and control persons pursuant to the
foregoing provisions or otherwise, we have been advised that, in the opinion of
the SEC, such indemnification is against public policy, and is, therefore,
unenforceable.
45
RECENT
SALES OF UNREGISTERED SECURITIES
On March
19, 2010 the Company issued 20,000,000 shares of common stock to the Gary
Basrai, the founder, sole executive officer and a director of the Company at
$0.0001 per share for total proceeds of $2,000. This transaction was
conducted in reliance upon an exemption from registration provided under Section
4(2) of the Securities Act of 1933, as
amended.
In April
and May 2010, we issued an aggregate 4,740,000 of shares of our common stock to
32 investors in a fully subscribed private placement made pursuant to the
exemption from the registration requirements of the Securities Act provided by
Regulation D and Regulation S respectively. The consideration paid
for such shares was $0.01 per share as to the 3,500,000 common shares issued in
April 2010 and $0.05 per share as to the 1,240,000 common shares issued in May
2010, amounting in the aggregate proceeds of $97,000.
EXHIBITS
The
following exhibits are filed as part of this registration
statement:
Exhibit
|
Description
|
3.1
|
Articles
of Incorporation
|
3.2
|
Amendment to Articles of Incorporation – Name Change |
3.3
|
Amendment
to Articles of Incorporation – Par Value
|
3.4
|
By-Laws
|
4.1
|
Form
of Stock Certificate
|
5.1
|
Opinion
of David Lubin & Associates, PLLC regarding the legality of the
securities being registered
|
10.1
|
Form
of Regulation D Subscription Agreement
|
10.2
|
Form
of Regulation S Subscription Agreement
|
10.3
|
Lease
Agreement dated May 18, 2010 by and between MinQuest, Inc. and the
Company.
|
10.4
|
Service
Agreement dated May 15, 2010 by and between Bill Eastwood and the
Company
|
23.1
|
Consent
of Robison, Hill & Co.
|
23.2
|
Consent
of David Lubin & Associates, PLLC (included in Exhibit
5.1)
|
24.1
|
Power
of Attorney (included on signature
page)
|
46
UNDERTAKINGS
The
undersigned registrant hereby undertakes to:
(a)(1)
File, during any period in which it offers or sells securities, a post-effective
amendment to this registration statement to:
(i) Include any prospectus required by
Section 10(a)(3) of the Securities Act;
(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 percent 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.
(2) For
determining liability under the Securities Act, each post-effective amendment
shall be deemed to be a new registration statement of the securities offered,
and the offering of the securities at that time shall be deemed to be the
initial bona fide offering.
(3) File
a post-effective amendment to remove from registration any of the securities
that remain unsold at the end of the offering.
(4) For
determining liability of the undersigned registrant under the Securities Act to
any purchaser in the initial distribution of the securities, the undersigned
registrant undertakes that in a primary offering of securities of the
undersigned registrant pursuant to this registration statement, regardless of
the underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of 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 to such
purchaser:
(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.
47
(b)
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "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 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 or 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 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.
(c) That,
for the purpose of determining liability under the Securities Act to any
purchaser:
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.
48
SIGNATURES
In
accordance with the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing this Form S-1 and has authorized this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Fremont, State of California, on August 24,
2010.
TUNDRA
GOLD CORP.
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By:
/s/ Gary
Basrai
Name:
Gary Basrai
Title: President
(principal executive officer)
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POWER
OF ATTORNEY
KNOW
ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Gary Basrai, his or her true and lawful
attorney-in-fact, with full power of substitution and resubstitution, for him or
her and in his or her name, place and stead, in any and all capacities to sign
any and all amendments (including post-effective amendments) to this
registration statement and to sign a registration statement pursuant to Section
462(b) of the Securities Act of 1933, and to file the same with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorney-in-fact, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorney-in-fact or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this registration statement
has been signed by the following persons in the capacities and on the dates
indicated.
Date:
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Signature:
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Name:
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Title:
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August
24, 2010
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/s/ Gary Basrai
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Gary
Basrai
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CEO,
President and Director (Principal Executive Officer)
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August
24, 2010
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/s/ Bill Eastwood
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Bill
Eastwood
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Director
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