Attached files
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EXCEL - IDEA: XBRL DOCUMENT - CAN CAL RESOURCES LTD | Financial_Report.xls |
EX-32 - EXHIBIT 32.1 - CAN CAL RESOURCES LTD | exhibit321.htm |
EX-31 - EXHIBIT 31.1 - CAN CAL RESOURCES LTD | exhibit31.1.htm |
EX-31 - EHXIBIT 31.2 - CAN CAL RESOURCES LTD | exhibit31.2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2012
¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 000-26669
CAN-CAL RESOURCES LTD.
(Exact name of registrant as specified in its charter)
Nevada | 88-0336988 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
8205 Aqua Spray Avenue |
Las Vegas, Nevada |
(Address of principal executive offices)
(702) 243-1849
(Registrants telephone number, including area code)
Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
x Yes ¨ No
Indicate by checkmark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data Filed required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period the registrant was requires to submit and post such files)
x Yes ¨ No
Large accelerated filer ¨
Accelerated filer ¨
Non-accelerated filer ¨ (Do not check if a smaller reporting company)
Smaller reporting company x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ¨ No x
The number of shares of Common Stock, $0.001 par value, outstanding on May 4, 2012 was 41,027,060.
CAN-CAL RESOURCES LTD.
FORM 10-Q
TABLE OF CONTENTS
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PART I FINANCIAL INFORMATION |
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| ITEM 1. FINANCIAL STATEMENTS |
| 1 | |
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| Condensed Balance Sheets as of March 31, 2012 (Unaudited) and December 31, 2011 |
| 1 |
|
| Condensed Statements of Operations (Unaudited) |
| 2 |
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| Condensed Statements of Cash Flows (unaudited) |
| 3 |
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| Notes to Condensed Financial Statements (Unaudited) |
| 4 |
| ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS |
| 11 | |
| ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
| 15 | |
| ITEM 4. CONTROLS AND PROCEDURES |
| 15 | |
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PART II OTHER INFORMATION |
| 15 | ||
| ITEM 1. LEGAL PROCEEDINGS |
| 15 | |
| ITEM 1A. RISK FACTORS |
| 15 | |
| ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
| 15 | |
| ITEM 3. DEFAULTS UPON SENIOR SECURITIES |
| 16 | |
| ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
| 16 | |
| ITEM 5. OTHER INFORMATION |
| 16 | |
| ITEM 6. EXHIBITS |
| 17 |
CAN-CAL RESOURCES LTD. | |||
(AN EXPLORATION STAGE COMPANY) | |||
CONDENSED BALANCE SHEETS | |||
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| March 31, |
| December 31, |
| 2012 |
| 2011 |
ASSETS | (Unaudited) |
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Current assets: |
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Cash | $ 48,534 |
| $ 37,846 |
Other current assets | 20,285 |
| 21,499 |
Total current assets | 68,819 |
| 59,345 |
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Property and equipment (net of accumulated |
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depreciation of $28,623 and $26,971, respectively) | 4,931 |
| 6,583 |
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Total assets | $ 73,750 |
| $ 65,928 |
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LIABILITIES AND STOCKHOLDERS' (DEFICIT) |
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Current liabilities: |
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Accounts payable | $ 33,436 |
| $ 25,936 |
Accounts payable, related parties | 135,000 |
| 120,632 |
Accrued expenses | 7,719 |
| 4,967 |
Accrued expenses, related parties | 273,260 |
| 243,869 |
Unearned rental revenues | 29,792 |
| 9,167 |
Notes payable, related parties | 53,062 |
| 53,062 |
Total current liabilities | 532,269 |
| 457,633 |
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Total liabilities | 532,269 |
| 457,633 |
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Commitments and contingencies |
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Stockholders' (deficit): |
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Preferred stock, $0.001 par value, 10,000,000 shares |
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authorized, no shares issued and outstanding | - |
| - |
Common stock, $0.001 par value, 100,000,000 shares authorized, |
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39,717,911 and 38,901,246 shares issued and outstanding |
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as of March 31, 2012 and December 31, 2011, respectively | 39,718 |
| 38,901 |
Subscriptions payable, 17,500, and 50,000 shares at |
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March 31, 2012 and December 31, 2011, respectively | 1,050 |
| 1,500 |
Additional paid-in capital | 9,295,356 |
| 9,248,673 |
(Deficit) accumulated during exploration stage | (9,794,643) |
| (9,680,779) |
Total stockholders' (deficit) | (458,519) |
| (391,705) |
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Total liabilities and stockholders' (deficit) | $ 73,750 |
| $ 65,928 |
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See accompanying notes to condensed financial statements. |
1
CAN-CAL RESOURCES LTD. | |||||
(AN EXPLORATION STAGE COMPANY) | |||||
CONDENSED STATEMENTS OF OPERATIONS | |||||
(Unaudited) | |||||
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| March 22, 1995 |
| For the three months ended |
| (inception) to | ||
| March 31, |
| March 31, | ||
| 2012 |
| 2011 |
| 2012 |
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Material sales | $ - |
| $ - |
| $ 245,500 |
Cost of sales | - |
| - |
| 263,400 |
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Gross loss | - |
| - |
| (17,900) |
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Operating expenses: |
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Exploration costs | 8,378 |
| 7,848 |
| 604,227 |
General and administrative | 80,369 |
| 62,303 |
| 7,094,340 |
Depreciation | 1,652 |
| 2,193 |
| 260,436 |
Officer salary | 30,000 |
| 30,000 |
| 1,111,176 |
Impairment of operating assets | - |
| - |
| 443,772 |
Total operating expenses | 120,399 |
| 102,344 |
| 9,513,951 |
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Loss from operations | (120,399) |
| (102,344) |
| (9,531,851) |
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Other income (expense): |
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Other income | 2,350 |
| 3,000 |
| 69,048 |
Interest income | - |
| - |
| 52,945 |
Interest expense | (2,690) |
| (20,164) |
| (1,468,135) |
Rental revenue | 6,875 |
| 16,875 |
| 401,783 |
Gain on disposal of fixed assets | - |
| - |
| 3,128 |
Gain on extinguishment of debts | - |
| - |
| 1,152,039 |
Total other income (expense) | 6,535 |
| (289) |
| 210,808 |
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Loss before provision for income taxes | (113,864) |
| (102,633) |
| (9,321,043) |
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Provision for income taxes | - |
| - |
| - |
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Net loss from continuing operations | (113,864) |
| (102,633) |
| (9,321,043) |
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Income from discontinued operations: |
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Income from discontinued operations | - |
| - |
| 116,400 |
Loss on disposal of operations (net of taxes) | - |
| - |
| (590,000) |
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Net (loss) | $ (113,864) |
| $ (102,633) |
| $ (9,794,643) |
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Weighted average number of common shares |
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outstanding - basic and fully diluted | 39,083,663 |
| 33,671,721 |
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Net (loss) per share - basic and fully diluted | $ (0.00) |
| $ (0.00) |
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See accompanying notes to condensed financial statements. |
2
CAN-CAL RESOURCES LTD. | |||||
(AN EXPLORATION STAGE COMPANY) | |||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||
(Unaudited) | |||||
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| March 22, 1995 |
| For the three months ended |
| (inception) to | ||
| March 31, |
| March 31, | ||
| 2012 |
| 2011 |
| 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES |
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Net loss | $ (113,864) |
| $ (102,633) |
| $ (9,794,643) |
Adjustments to reconcile net loss |
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to net cash used in operating activities: |
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Depreciation and amortization | 1,652 |
| 2,193 |
| 260,436 |
Bad debts | - |
| - |
| 207,100 |
Gain on sale of fixed assets | - |
| - |
| (3,128) |
Gain on extinguishment of debts |
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| (1,152,039) |
Stock based compensation granted for services | 1,050 |
| 3,115 |
| 563,952 |
Stock based compensation granted for financing and interest | - |
| - |
| 734,190 |
Beneficial conversion feature on convertible debenture | - |
| - |
| 25,200 |
Loss on disposal of investment property | - |
| - |
| 764,300 |
Undistributed earnings of affiliate | - |
| - |
| (174,300) |
Gain on discontinued operations | - |
| - |
| (116,400) |
Loss on foreign currency translation | - |
| - |
| 8,500 |
Impairment of operating assets | - |
| - |
| 443,772 |
Decrease (increase) in assets: |
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Other current assets | 1,214 |
| 4,892 |
| 100,615 |
Increase (decrease) in liabilities: |
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Accounts payable | 7,500 |
| (60,393) |
| (34,476) |
Accounts payable, related parties | 14,368 |
| 15,000 |
| 135,000 |
Accrued expenses | 2,752 |
| 13,211 |
| 546,297 |
Accrued expenses, related parties | 29,391 |
| 31,192 |
| 555,264 |
Unearned revenues | 20,625 |
| 20,625 |
| 29,792 |
Net cash used in operating activities | (35,312) |
| (72,798) |
| (6,900,568) |
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CASH FLOWS FROM INVESTING ACTIVITIES |
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Purchase of investment property | - |
| - |
| (1,083,600) |
Proceeds from sale of investment property | - |
| - |
| 319,300 |
Purchase of property and equipment | - |
| - |
| (769,411) |
Proceeds from sale of property and equipment | - |
| - |
| 26,100 |
Net cash used in investing activities | - |
| - |
| (1,507,611) |
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CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from convertible debentures | - |
| - |
| 128,800 |
Proceeds from notes payable | - |
| - |
| 948,400 |
Principal payments on notes payable | - |
| - |
| (689,900) |
Proceeds from notes payable, related parties | - |
| - |
| 907,791 |
Principal payments on notes payable, related parties | - |
| (4,000) |
| (383,179) |
Proceeds from the issuance of common stock | 46,000 |
| 113,300 |
| 7,544,801 |
Net cash provided by financing activities | 46,000 |
| 109,300 |
| 8,456,713 |
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Net increase in cash | 10,688 |
| 36,502 |
| 48,534 |
Cash, beginning of period | 37,846 |
| 17,202 |
| - |
Cash, end of period | $ 48,534 |
| $ 53,704 |
| $ 48,534 |
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Supplemental disclosures: |
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Interest paid | $ - |
| $ - |
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Income taxes paid | $ - |
| $ - |
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See accompanying notes to condensed financial statements. |
3
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1 Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with Securities and Exchange Commission requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the Form 10-K for the year ended December 31, 2010 of Can-Cal Resources Ltd. (the Company).
The interim condensed financial statements present the balance sheets, statements of operations and cash flows of Can-Cal Resources Ltd. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States.
The interim financial information is unaudited. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2012 and the results of operations and cash flows presented herein have been included in the financial statements. Interim results are not necessarily indicative of results of operations for the full year.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation.
Exploration Stage Company
The Company is currently an exploration stage company. As an exploration stage enterprise, the Company discloses the deficit accumulated during the exploration stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date. The Company has incurred net losses of $9,794,643 and used net cash in operations of $6,900,568 for the period from inception (March 22, 1995) through March 31, 2012. An entity remains in the exploration stage until such time as proven or probable reserves have been established for its deposits. Upon the location of commercially mineable reserves, the Company plans to prepare for mineral extraction and enter the development stage. To date, the exploration stage of the Companys operations consists of contracting with geologists who sample and assess the mining viability of the Companys claims.
Note 2 Going Concern
The Company incurred a net loss of $113,864 for the three months ended March 31, 2012. Also, the Companys current liabilities exceed its current assets by $463,450 as of March 31, 2012. These factors create substantial doubt about the Companys ability to continue as a going concern. The Companys management plans to continue to fund its operations in the short term with a combination of debt and equity financing and with revenue from operations in the long term.
The ability of the Company to continue as a going concern is dependent on securing additional sources of capital and the success of the Companys plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Note 3 Related Party
On January 30, 2012, the Company appointed Mr. Thompson MacDonald to the Board of Directors. Compensation has not yet been determined.
On January 9, 2012, we reimbursed $632 of previously incurred expenses to one of our board members.
On September 15, 2011, we repaid $129 on an unsecured note payable due to our CEO, G. Michael Hogan.
On June 30, 2011, the Company extended 2,439,920 previously granted common stock warrants issued to the Companys CEO, with an exercise price of $0.15 for an additional 15 months from their expiration on June 30, 2011. These warrants are fully vested and expire on September 30, 2012. The total estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 180% and a call option value of $0.0090, was $22,047 and was recognized as interest expense during the year ended December 31, 2011.
On June 30, 2011, the Company extended a total of 1,301,312 previously granted common stock warrants issued to the one of the Companys directors, with an exercise price of $0.15 for an additional 15 months from their expiration on June 30, 2011. These warrants are fully vested and
4
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
expire on September 30, 2012. The total estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 180% and a call option value of $0.0090, was $11,758 and was recognized as interest expense during the year ended December 31, 2011.
During the year ended December 31, 2010, we received a total of $28,191 in exchange for an unsecured note payable to our CEO, G. Michael Hogan, due on demand, bearing interest at 8.00%.
On November 12, 2010, we received a short term loan of $9,000 in exchange for a non-interest bearing, unsecured note payable to an employee, due on demand. On December 30, 2010 the Company repaid $5,000, and the remaining $4,000 was repaid in February of 2011.
On July 1, 2010, the Company entered into a twelve month employment agreement, subject to automatic monthly renewals, with the Companys CEO, G. Michael Hogan. The terms of the agreement include a fixed annual salary of $120,000. The Company may elect to satisfy payment in shares of common stock in lieu of cash at a market value equal to $0.10 above the average closing trading price of the common stock for the preceding five (5) days from the date of such election. No payments have been made in cash or stock as of December 31, 2011.
We owed accrued salaries to our CEO of $270,000 and $240,000 at March 31, 2012 and December 31, 2011, respectively.
On June 30, 2010, the Company entered into a twelve month consulting agreement, with a Board of Directors consulting firm, Futureworth Capital Corp. The terms of the agreement include annual compensation of $60,000, payable monthly. The Company may elect to satisfy payment in shares of common stock in lieu of cash at a market value equal to $0.10 above the average closing trading price of the common stock for the preceding five (5) days from the date of such election. No payments have been made in cash or stock as of December 31, 2011. As of March 31, 2012 we owed Futureworth Capital Corp. $135,000, as included in accounts payable, related parties, for service prior to, and during the service period under the consulting agreement.
On September 1, 2010, we received $25,000 in exchange for an unsecured note payable to a Board of Directors consulting firm, Futureworth Capital Corp, due on demand, bearing interest at 8.25%.
Note 4 Notes Payable, Related Parties
Notes payable, related parties consisted of the following as of March 31, 2012 and December 31, 2011, respectively:
| March 31, |
| December 31, | ||
| 2012 |
| 2011 | ||
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Note payable to a member of the Board of Directors, unsecured, due on demand, bearing interest at 8.25%, related party. | $ | 25,000 |
| $ | 25,000 |
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Note payable to the CEO, unsecured, non-interest bearing, due on demand, related party. |
| 28,062 |
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| 28,062 |
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Total notes payable |
| 53,062 |
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| 53,062 |
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Less: current portion |
| 53,062 |
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| 53,062 |
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Notes payable, less current portion | $ | - |
| $ | - |
Interest expense totaled $2,690 and $20,164 for the three months ended March 31, 2012 and 2011, respectively, including $516 and $516 of related party interest expense for the three months ended March 31, 2012 and 2011, respectively.
5
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Interest expense included non-cash finance costs related to the fair value of common stock granted to non-related parties of $2,100 and $6,230 for the three months ended March 31, 2012 and 2011, respectively, as well as, interest on short term financing and long term debts to non-related parties of $74 and $13,418 for the three months ended March 31, 2012 and 2011, respectively.
Note 5 Changes in Securities
2011
On January 4, 2011, the Company sold 680,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $40,800. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On January 4, 2011, the Company sold 170,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $10,200. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On January 5, 2011, the Company issued a total of 2,146,666 shares of its par value common stock to satisfy subscriptions payable outstanding as of December 31, 2010 related to debts converted by a total of nine investors in the amount of $128,800.
On January 26, 2011, the Company sold 85,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $5,100. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On January 26, 2011, the Company sold 85,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $5,100. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On February 25, 2011, the Company sold 170,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $10,200. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 16, 2011, the Company sold a total of 698,334 shares of common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $41,900 from four investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On April 1, 2011, the Company sold a total of 320,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $19,200 from three investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On May 31, 2011, the Company sold a total of 255,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $15,300 from two investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On June 10, 2011, the Company sold a total of 565,250 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $33,915 from six investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On June 22, 2011, the Company sold a total of 595,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $35,700 from three investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On June 29, 2011, the Company sold a total of 1,067,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $64,020 from five investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
6
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
On July 12, 2011, the Company sold 84,000 shares of common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds $5,040. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On September 26, 2011, the Company sold a total of 700,000 shares of common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $42,000 from three investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On October 14, 2011, the Company sold a total of 150,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $9,000 from two investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On October 18, 2011, the Company sold a total of 200,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $12,000 from two investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On October 24, 2011, the Company issued a total of 218,793 shares of its common stock as commissions on the sale of securities amongst three different sales persons. The total fair value of the common stock was $12,078 based on the fair market value of the Companys common stock on the date of grant. The Company elected not to net these commissions against the proceeds received from the sales and recognized the $12,078 of finance costs as interest expense within the statement of operations.
On December 29, 2011 the Company granted 50,000 shares of common stock to an employee for services rendered. The fair value of the common stock was $1,500 based on the closing price of the Companys common stock on the date of grant. The shares were authorized, but unissued and recognized as a subscription payable as of December 31, 2011. The shares were subsequently issued on March 20, 2012.
2012
On February 15, 2012, the Company sold a total of 200,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $12,000 received amongst two investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company sold a total of 566,665 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $34,000 received amongst four investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company granted a total of 17,500 shares of its common stock as commissions on the sale of securities. The total fair value of the common stock was $1,050 based on the fair market value of the Companys common stock on the date of grant. The Company elected not to net these commissions against the proceeds received from the sales and recognized the $1,050 of finance costs as interest expense within the statement of operations. The shares were authorized, but unissued and recognized as a subscription payable as of March 31, 2012. The shares were subsequently issued in April of, 2012.
On March 20, 2012 the Company issued 50,000 shares of its common stock to satisfy the $1,500 of subscriptions payable realized pursuant to common stock granted to an employee for services on December 29, 2011.
7
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 6 Options and Warrants
Options
There were no options issued during the three months ended March 31, 2012 and 2011, respectively.
The following table summarizes the Companys option activity related to employees and consultants:
|
|
|
| Weighted | |
|
| Options |
| Average | |
|
| Outstanding |
| Exercise Price | |
|
|
|
|
|
|
Balance, January 1, 2011 |
| 1,000,000 |
|
| 0.18 |
Granted |
| - |
|
| - |
Cancelled |
| - |
|
| - |
Exercised |
| - |
|
| - |
Expired |
| (1,000,000) |
|
| (0.18) |
Balance, December 31, 2011 |
| - |
|
| - |
Granted |
| - |
|
| - |
Cancelled |
| - |
|
| - |
Exercised |
| - |
|
| - |
Expired |
| - |
|
| (0.16) |
Balance, March 31, 2012 |
| - |
|
| - |
Warrants
On January 22, 2010, the Company granted 40,000 stock warrants with an exercise price of $0.15 per share for its common stock. These stock warrants were granted in connection with financing activities relating to stock sold on January 22, 2010. These warrants were exercisable upon issuance and expire on March 31, 2011.
On December 31, 2010, the Company granted 2,146,666 common stock warrants with an exercise price of $0.08 per share. These stock warrants were granted in connection with the conversion of $128,800 of previously issued convertible debentures on December 31, 2010 to a total of nine investors in exchange for a total of 2,146,666 shares. These warrants were exercisable upon issuance and expire on December 31, 2012.
During the year ended December 31, 2011, the Company granted a total of 5,824,584 common stock warrants with an exercise price of $0.08 per share for its common stock amongst a total of thirty six investors. These stock warrants were granted in connection with financing activities related to the sale of common stock sold at various dates between January 4, 2011 and October 18, 2011. These warrants were exercisable upon issuance and expire two years from the date of grant, consisting of maturity dates between January 4, 2013 and October 18, 2011.
On February 15, 2012, the Company granted 100,000 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 100,000 shares of common stock in exchange for proceeds of $6,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
On February 15, 2012, the Company granted 100,000 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 100,000 shares of common stock in exchange for proceeds of $6,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
On March 20, 2012, the Company granted 150,000 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 150,000 shares of common stock in exchange for proceeds of $9,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
On March 20, 2012, the Company granted 83,3333 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 83,333 shares of common stock in exchange for proceeds of $5,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
8
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
On March 20, 2012, the Company granted 166,666 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 166,666 shares of common stock in exchange for proceeds of $10,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
On March 20, 2012, the Company granted 166,666 common stock warrants with an exercise price of $0.08 per share for its common stock. These stock warrants were granted in connection with the sale of 166,666 shares of common stock in exchange for proceeds of $10,000. These warrants are exercisable over two years at an exercise price of $0.08 per share.
A total of -0- and 1,064,000 warrants expired during the three months ended March 31, 2012 and the year ended December 31, 2011, respectively.
The following table summarizes the Companys warrant activities:
|
|
|
| Weighted | |
|
| Warrants |
| Average | |
|
| Outstanding |
| Exercise Price | |
|
|
|
|
|
|
Balance, January 1, 2011 |
| 9,588,162 |
|
| 0.13 |
Granted |
| 5,824,584 |
|
| 0.08 |
Cancelled |
| - |
|
| - |
Exercised |
| - |
|
| - |
Expired |
| (1,064,000) |
|
| (0.15) |
Balance, December 31, 2011 |
| 14,348,746 |
|
| 0.11 |
Granted |
| 766,665 |
|
| 0.08 |
Cancelled |
| - |
|
| - |
Exercised |
| - |
|
| - |
Expired |
| - |
|
| - |
Balance, March 31, 2012 |
| 15,115,411 |
|
| 0.11 |
Note 7 Commitments and Contingencies
Mining Claims - The Company has a lease and purchase option agreement covering six patented claims in the Cerbat Mountains, Hualapai Mining District and Mohave County Arizona. The Company pays $1,500 per quarter as minimum advance royalties. The Company has the option to purchase the property for $250,000 plus interest at a rate of 8% compounded annually from and after the date of its exercise of the option to purchase the property. If the Lessee exercises its option to purchase, all funds paid to Lessors shall be credited toward the purchase price as of the date the payments were made.
9
CAN-CAL RESOURCES LTD.
(An Exploration Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 8 Subsequent Events
Debt Repayments, Related Parties
On April 1, 2012, the Company repaid $28,062 of previous loans from the Companys CEO.
On April 1, 2012, the Company repaid a total of $28,260 of previous loans from one of the Companys Board of Directors, including accrued interest of $3,260.
Common Stock Issuances
On April 4, 2012, the Company sold a total of 874,982 shares of its common stock and an equal number of warrants pursuant to unit offerings amongst three individual investors in exchange for total proceeds of $52,499. The warrants are exercisable over two years at an exercise price of $0.08 per share. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On April 4, 2012, the Company sold 416,667 shares of its common stock and an equal number of warrants pursuant to unit offerings to a member of the Companys Board of Directors in exchange for proceeds of $25,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On April 25, 2012 the Company issued 17,500 shares of its common stock to satisfy a subscription payable in the amount of $1,050 realized pursuant to common stock granted to a sales person for commissions on the sale of securities on February 15, 2012 and March 20, 2012.
10
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OVERVIEW AND OUTLOOK
The following discussion of the business, financial condition and results of operation of the Company should be read in conjunction with the financial statements of the Company for the years ended December 31, 2011 and 2010 and the and the notes to those statements that are included their respective Annual Reports on Form 10-K, as well as the financial statements and notes the financial statements included in this Form 10-Q. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statement, including, but not limited to, the risk factors described in this Form 10-Q and in Item 1A of our Form 10-K for the year ended December 31, 2011 to which reference is made herein.
Overview
Can-Cal Resources Ltd. is a publicly traded exploration stage company engaged in seeking the acquisition and exploration of metals mineral properties. As part of its growth strategy, the Company will focus its future activities in the USA, with an emphasis on the Pisgah Mountain, California property and the Wikieup, Arizona property.
At March 31, 2012, we had cash on hand of $48,534 available to sustain operations. Accordingly, we are uncertain as to whether the Company may continue as a going concern. While we may seek additional investment capital, or possible funding or joint venture arrangements with other mining companies, we have no assurance that such investment capital or additional funding and joint venture arrangements will be available to the Company.
We expect in the near term to continue to rely on outside financing activities to finance our operations. We used investment proceeds realized during 2011 and during the first three months of 2012 for (i) completion of work-up of two potential extraction processes to determine which process we will employ to potentially prove up any precious metals, platinum groups elements and/or other base metals on the Pisgah, California property and the Wikieup, Arizona property, if any; (ii) the development of a drill program to potentially prove up any tonnages and precious metals and/or other base metals on the Wikieup, Arizona property, if any; (iii) the continued development a comprehensive research and development program to ascertain the potential for any rare earth elements on the Owl Canyon, California property; (iv) strategic working capital reserve and (v) to finance our operations.
In addition to our historic exploration activities, we are currently under taking alternative revenue producing opportunities at our Pisgah property. On January 23, 2012 we entered into a mineral lease agreement with a partner who will purchase up to 100,000 tons of resources derived from the property to produce commercial products for resale. The agreement is for an initial period of ten (10) years, with an additional five (5) year extension at the option of the lessee. We will receive fees for the removal of minerals at diminishing prices in $0.50 increments between $12 per ton and $10 per ton for each 20,000 tons of material removed.
With reference to the Wikieup Property, Can-Cal has commissioned a Geologist to perform a three-phased project to evaluate the property and its surrounding areas. The use of Satellite Imaging Interpretation software will provide regional, geological mapping. The next phase is to take surface samplings from various areas and have the samples analyzed. The results will determine the potential for any commercially viable mineral deposits as well as prospective drilling locations.
11
Results of Operations for the Three Months Ended March 31, 2012 and 2011:
| Three Months Ended |
|
|
| |||
| March 31, |
|
|
| |||
| 2012 |
| 2011 |
| Increase / (Decrease) |
| |
| Amount |
| Amount |
| $ | % |
|
Expenses: |
|
|
|
|
|
|
|
Exploration costs | $ 8,378 |
| $ 7,848 |
| $ 530 | 7% |
|
General & administrative | 80,369 |
| 62,303 |
| 18,066 | 29% |
|
Depreciation | 1,652 |
| 2,193 |
| (541) | (25%) |
|
Officer salary | 30,000 |
| 30,000 |
| - | - |
|
Total operating expenses | 120,399 |
| 102,344 |
| 18,055 | 18 % |
|
|
|
|
|
|
|
|
|
Loss from operations | (120,399) |
| (102,344) |
| (18,055) | 18% |
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
Other income | 2,350 |
| 3,000 |
| (650) | (22%) |
|
Rental revenue | 6,875 |
| 16,875 |
| (10,000) | (59%) |
|
Interest expense | (2,690) |
| (20,164) |
| 17,474 | (87%) |
|
Total other income (expense) | 6,535 |
| (289) |
| 6,824 | (2,361%) |
|
|
|
|
|
|
|
|
|
Net loss | $ (113,864) |
| $ (102,633) |
| $ (11,231) | 11% |
|
Exploration costs
Exploration costs for the three months ended March 31, 2012 increased by $530 (or 7%) from $7,848 for the three months ended March 31, 2011 to $8,378 for the three months ended March 31, 2012. The increase is due to annual price increases on our Bureau of Land Management (BLM) fees related to our Pisgah and Wikieup locations.
Unless the Company is able to establish the economic viability of its mining properties, the Company will continue writing off its expenses of exploration and testing of its properties. Therefore, losses will continue unless the Company sells one or more of its properties or locates and delineates reserves and initiates mining operations. If that occurs, the Company may capitalize certain of those expenses.
The Company has no material commitments for capital expenditures other than expenditures it chooses or may choose to make, if funds are available, with respect to testing and or exploration of its mineral properties.
General and administrative expenses
General and administrative expenses for the three months ended March 31, 2012 increased by $18,066 (or 29%) from $62,303 for the three months ended March 31, 2011 to $80,369 for the three months ended March 31, 2012. The increase is principally due to increased legal fees due to credits that were granted by our attorneys during the comparative three months ended March 31, 2011 that were not granted during the three months ended March 31, 2012.
Depreciation
Depreciation for the three months ended March 31, 2012 decreased by $541 (or 25%) from $2,193 for the three months ended March 31, 2011 to $1,652 for the three months ended March 31, 2012. The decrease is principally due to certain assets reaching the end of their depreciable life cycle. We anticipate the replacement of these assets in the near future.
Officer salary
Officer salary for the three months ended March 31, 2012 and 2011 was $30,000 in accordance with the annual compensation of $120,000 to our Chief Executive Officer. No bonuses or stock awards were granted, and all compensation was accrued. No payments have been made in either cash or shares of the Companys stock in either period.
12
Total operating expenses
Total operating expenses for the three months ended March 31, 2012 increased by $18,055 (or 18%) from $102,344 for the three months ended March 31, 2011 to $120,399 for the three months ended March 31, 2012. The increase in total operating expenses was mainly a result of additional General and Administrative expenses related to increased legal fees due to credits that were granted by our attorneys during the comparative three months ended March 31, 2011 that were not granted during the three months ended March 31, 2012.
Other income (expense)
Other income for the three months ended March 31, 2012 decreased by $650 (or 22%) from $3,000 for the three months ended March 31, 2011 to $2,350 for the three months ended March 31, 2012 due to diminished collection of proceeds received in settlement of misappropriated funds by our former bookkeeper during the three months ended March 31, 2012 compared to the three months ended March 31, 2011.
Rental revenue for the three months ended March 31, 2012 decreased by $10,000 (or 59%) from $16,875 for the three months ended March 31, 2011 to $6,875 for the three months ended March 31, 2012. Rental revenue relates to income derived from the rental of the Companys land for the purposes of mineral extraction, filming movies or conducting photo shoots. Our land was leased for $10,000 related to a photo shoot that was held during the three months ended March 31, 2011 that was not realized in current period
Interest expense for the three months ended March 31, 2012 decreased by $17,474 (or 87%) from $20,164 for the three months ended March 31, 2011 compared to $2,690 for the three months ended March 31, 2012. The decrease in interest expense was due to substantial extinguishment of debts during the fourth quarter of 2011 that significantly relieved our debt burden, and associated interest obligations in the current year.
Net loss
Our net loss for the three months ended March 31, 2012 increased by $11,231 (or 11%) from $102,633 for the three months ended March 31, 2011 compared to $113,864 for the three months ended March 31, 2012. Our increased net loss for the three months ended March 31, 2012 was primarily a result of increased general and administrative expenses related to credits that were granted by our attorneys during the comparative three months ended March 31, 2011 that were not granted during the three months ended March 31, 2012 and the absence of $10,000 of revenues related to leased land for photo shoots in the current period that were realized during the comparative three month period, as offset by decreased interest expenses related to substantial extinguishment of debts during the fourth quarter of 2011 that significantly relieved our debt burden, and associated interest obligations in the current year.
13
LIQUIDITY AND CAPITAL RESOURCES
The following table summarizes total current assets, total current liabilities and working capital at March 31, 2012 compared to December 31, 2011.
| March 31, |
| December 31, |
| Increase / (Decrease) | |||
| 2012 |
| 2011 |
| $ | % | ||
|
|
|
|
|
|
|
|
|
Current Assets | $ | 68,819 |
| $ | 59,345 |
| $ 9,474 | 16% |
|
|
|
|
|
|
|
|
|
Current Liabilities | $ | 532,269 |
| $ | 457,633 |
| $ 74,636 | 16% |
|
|
|
|
|
|
|
|
|
Working Capital (deficit) | $ | (463,450) |
| $ | (398,288) |
| $ 65,162 | 16% |
Internal and External Sources of Liquidity
During the three months ended March 31, 2012 and 2011, our operating and investing activities used cash of $35,312 and $72,798, respectively, while our financing activities provided cash of $46,000 and $109,300, respectively. The cash used in operating activities was principally a result of the net loss we incurred.
Financing Activities. During the three months ended March 31, 2012 we raised a total of $46,000 from the sale of common stock to a total of six (6) accredited investors under a private placement offering through the sale of 816,665 Units of the Company at a price of US$0.06 per Unit. The terms of the private placement allow us to raise up to $1,000,000 through a private placement of units of securities (Unit) of the Company, at a price of US$0.06 per Unit. Each Unit consists of one share of common stock (Common Share) and one Common Share purchase Warrant (Warrant) exercisable over two years at a strike price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $1,050 and 17,500 Common Shares. The shares were recorded as subscriptions payable in the amount of $1,050 at March 31, 2012.
Cash Flow. Since inception, we have primarily financed our cash flow requirements through the issuance of common stock and the issuance of notes. With the expected growth of our current business we may, during our normal course of business, experience net negative cash flows from operations until some of our mining activities begin to produce revenues. Further, we will therefore be required to obtain financing to fund operations, both during periods of growth and/or contraction, through additional common stock offerings and bank or other debt borrowings, to the extent available, or to obtain additional financing to the extent necessary to augment our available working capital.
Satisfaction of our cash obligations for the next twelve months.
As of March 31, 2012, our cash balance was $48,534. Our plan for satisfying our cash requirements for the next twelve months is through additional debt and/or equity financing. We anticipate our current cash reserves will be sufficient to support operations through December 31, 2012, but do not anticipate generating sufficient amounts of positive cash flow from operations to meet our working capital requirements. Consequently, we intend to make appropriate plans in order to obtain sources of additional capital in the future to fund growth and expansion through the issuance of additional equity or debt financing or credit facilities. We also are considering possible funding through joint venture arrangements with other mining companies or other natural resource companies. However, there can be no assurance that we will raise capital through any of these means.
As we maintain or expand our current operational activities, we may continue to experience net negative cash flows from operations, and unless we generate sufficient sales through our operations, will be required to obtain additional financing to fund operations through common stock offerings and debt borrowings to the extent necessary to provide working capital.
We anticipate incurring operating losses until we build our capital base. Our operating history makes predictions of future operating results difficult to ascertain and unreliable. In addition, since our net loss has increased we are finding it increasingly difficult to support and expand our operations. Thus, our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stages of commercial viability. Such risks include, but are not limited to, an evolving and unpredictable business model and the management of growth. To address these risks we must, among other things, implement and successfully execute our business and marketing strategy, continuously develop and upgrade technology and products, respond to competitive developments, and continue to attract, retain and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.
14
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
ITEM 4. CONTROLS AND PROCEDURES.
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Companys Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to the Companys management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions in accordance with the required "disclosure controls and procedures" as defined in Rule 13a-15(e). The Companys disclosure and control procedures are designed to provide reasonable assurance of achieving their objectives, and the Chief Executive Officer and Chief Financial Officer of the Company concluded that the Companys disclosure controls and procedures were effective at the reasonable assurance level.
At the end of the period covered by this Quarterly Report, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on the foregoing, the Chief Executive Officer and Chief Financial Officer of the Company concluded that the Companys disclosure controls and procedures were effective to ensure that the information required to be disclosed in the Companys Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to the Companys management including the Companys Chief Executive Officer and Chief Financial Officer to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II--OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is not currently a party to litigation.
ITEM 1A. RISK FACTORS.
Our significant business risks are described in Item 1A of Form 10-K for the year ended December 31, 2011 to which reference is made herein.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
During the quarter ended March 31, 2012 Can-Cal completed the following sales of unregistered securities under private placement exemptions pursuant to Section 4(2) and Regulation S of the Securities Act of 1933, as follows:
On January 26, 2012, the Company issued 100,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $6,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $300 and 5,000 Common Shares.
On January 27, 2012, the Company issued 100,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $6,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $300 and 5,000 Common Shares.
15
On February 15, 2012, the Company sold a total of 200,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for total proceeds of $12,000 received amongst two investors. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company issued 150,000 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $9,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $450 and 7,500 Common Shares. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company issued 83,333 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $5,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $250 and 4,167 Common Shares. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company issued 166,666 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $10,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $500 and 8,333 Common Shares. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012, the Company issued 166,666 shares of its common stock and an equal number of warrants pursuant to a unit offering in exchange for proceeds of $10,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. Finders acting in connection with the private placement are entitled to receive aggregate fees of $500 and 8,333 Common Shares. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On March 20, 2012 the Company issued 50,000 shares of its common stock to satisfy the $1,500 of subscriptions payable realized pursuant to common stock granted to an employee for services on December 29, 2011.
The Company plans to use, and did use, the proceeds of the sale for: (i) the completion of its work-up of two extraction processes to determine which process, if either, will be used in the Companys efforts to potentially prove up any precious metals, platinum groups elements and/or other base metals on the Companys Pisgah, California site and Wikieup, Arizona site; (ii) conducting a drill program to potentially prove up potential tonnages and subsequently any precious metals and/or other base metals on the Wikieup, Arizona property; (iii) the undertaking of a comprehensive research and development program to ascertain the potential for any rare earth elements on the Owl Canyon, California site; (iv) the potential engagement of a qualified and comprehensive US and Canadian investor relations and shareholder communications group, and; (v) strategic working capital reserve.
Issuer Purchases of Equity Securities
We did not repurchase any of our equity securities during the three month period ended March 31, 2012.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
We did not submit any matters to a vote of our security holders during the three month period ending March 31, 2012.
ITEM 5. OTHER INFORMATION.
On January 30, 2012, the Company appointed Mr. Thompson MacDonald to the Board of Directors. Compensation for Mr. Thompson has not yet been determined. Mr. MacDonald had previously been appointed to the Board on June 4, 2009 but resigned November 13, 2009 in order to complete outside business commitments. Mr. MacDonald has an extensive background in Corporate Governance serving on public, private and not for profit boards. He has served as Chairman of Walton Global Investments, an Alberta land assembly and development company; and as Chairman of ENMAX, an Alberta based Electric Utility. Mr. MacDonald is a Director of FoodChek Systems Inc., a Calgary, Alberta food safety pathogen testing company, where he is Chairman of the Corporate Governance and Compensation Committee.
16
Events Subsequent to the Quarter Ended March 31, 2012
On April 17, 2012the Company appointed Ron Schinnour to the Board of Directors. Mr. Schinnour, of Calgary, Alberta, Canada has held numerous executive, leadership and management roles in the agricultural industry, both domestically and globally, including, among others, positions with Monsanto, United Agri Products and Agrium (Cominco). He recently moved back to Calgary and joined the UFA, holding the position of Executive VP of Agri Business. Mr. Schinnours practical experience includes Strategic Planning, Financial Management, International Business and M&A Leadership. Mr. Schinnour holds an MBA from Washington University with special recognition for Excellence in Team Process, Strategic Planning and Finance. He also holds a CMA Designation from the University of Calgary/Society of Management Accountants. Mr. Schinnour currently serves on the Board of Directors of FoodChek Systems Inc. (Calgary) and Universal Co-op Ltd. (Minneapolis). He previously served as the Chairman and Director for RAPID & AEC, and on the Board of Directors for the Latin America Agricultural Development Bank, AgroBio & the Agricultural Future of America. He has been President, Treasurer and Director of numerous corporate entities at Monsanto and UAP.
Subsequent to the quarter ended March 31, 2012, Can-Cal completed the following sales of unregistered securities under private placement exemptions pursuant to Section 4(2) and Regulation S of the Securities Act of 1933, as follows:
On April 4, 2012, the Company sold a total of 874,982 shares of its common stock and an equal number of warrants pursuant to unit offerings amongst three individual investors in exchange for total proceeds of $52,499. The warrants are exercisable over two years at an exercise price of $0.08 per share. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On April 4, 2012, the Company sold 416,667 shares of its common stock and an equal number of warrants pursuant to unit offerings to a member of the Companys Board of Directors in exchange for proceeds of $25,000. The warrants are exercisable over two years at an exercise price of $0.08 per share. The proceeds received were allocated between the common stock and warrants on a relative fair value basis.
On April 25, 2012 the Company issued 17,500 shares of its common stock to satisfy a subscription payable in the amount of $1,050 realized pursuant to common stock granted to an sales person for commissions on the sale of securities on February 15, 2012 and March 20, 2012.
ITEM 6. EXHIBITS.
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Exhibit | Exhibit Description | Filed herewith | Form | Period ending | Exhibit | Filing date |
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31.1 | Certification of Michael Hogan pursuant to Section 302 of the Sarbanes-Oxley Act | X |
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31.2 | Certification of Michael Hogan pursuant to Section 302 of the Sarbanes-Oxley Act | X |
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32.1 | Certification of Michael Hogan pursuant to Section 906 of the Sarbanes-Oxley Act | X |
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101.INS* | XBRL Instance Document | X |
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101.SCH* | XBRL Taxonomy Extension Schema Document | X |
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101.CAL* | XBRL Taxonomy Extension Calculation Linkbase Document | X |
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101.DEF* | XBRL Taxonomy Extension Definition Linkbase Document | X |
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101.LAB* | XBRL Taxonomy Extension Label Linkbase Document | X |
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101.PRE* | XBRL Taxonomy Extension Presentation Linkbase Document | X |
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* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Act of 1934 and otherwise are not subject to liability.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CAN-CAL RESOURCES LTD.
(Registrant)
/s/ Michael Hogan
By:
Michael Hogan, President and Chief Executive Officer
(On behalf of the Registrant and as Principal Financial
Officer)
Date: May 7, 2012