UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
FORM 10-Q
[X]
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
For the quarterly period ended
June 30, 2011
[ ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE
ACT OF 1934
For the transition period
from _________to ________
Commission File No.
000-53291
LAKE VICTORIA MINING COMPANY, INC.
(Exact name of registrant as specified in its charter)
Nevada
|
Not Applicable
|
(State or other jurisdiction of incorporation or
organization)
|
(I.R.S. Employer Identification No.)
|
Suite 810 675 West Hastings Street, Vancouver, British
Columbia, Canada V6B 1N2
(Address of principal executive offices)
(zip code)
604.681.9635
(Registrants telephone
number, including area code)
Not Applicable
(Former
name, former address and former fiscal year, if changed since last report)
Indicate by check mark 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.
Yes [X] No [ ]
Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
Yes [X] No [ ]
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See definitions of large accelerated filer, accelerated
filer, and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
Large accelerated filer
|
[ ]
|
Accelerated filer
|
[ ]
|
Non-accelerated filer
|
[ ]
|
Smaller reporting company
|
[X]
|
(Do not check if a smaller reporting company)
|
|
|
|
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
2
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING
THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after
distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuers
classes of common equity as of the latest practicable date:
As of
August 15, 2011, there were 97,458,733 shares of common stock, par value
$0.00001, outstanding.
3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
|
June 30, 2011
|
F-1
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Consolidated Balance Sheets
|
(Expressed in US dollars)
|
|
|
June 30,
|
|
|
March 31,
|
|
|
|
2011
|
|
|
2011
|
|
|
|
$
|
|
|
$
|
|
|
|
(Unaudited)
|
|
|
(Audited)
|
|
ASSETS
|
|
|
|
|
|
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Current Assets
|
|
|
|
|
|
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Cash
|
|
1,560,654
|
|
|
2,282,902
|
|
Advances and deposits (Note 3(e))
|
|
41,738
|
|
|
32,684
|
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Amounts receivable (Note 7(e))
|
|
616,246
|
|
|
256,968
|
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Advances to related party (Note 3)
|
|
|
|
|
499,043
|
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Total Current Assets
|
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2,218,638
|
|
|
3,071,597
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Short-term Investments (Note 4 and 11(d))
|
|
880,000
|
|
|
|
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Property and Equipment (Note 5)
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112,170
|
|
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103,302
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Mineral Properties
(Note 7)
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464,000
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|
|
|
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Total Assets
|
|
3,674,808
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|
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3,174,899
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|
|
|
|
|
|
|
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LIABILITIES AND STOCKHOLDERS EQUITY
|
|
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|
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Current Liabilities
|
|
|
|
|
|
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Accounts payable
|
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200,713
|
|
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212,721
|
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Accounts payable to related party (Note 3)
|
|
|
|
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624,773
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|
Accrued expenses
|
|
|
|
|
119,540
|
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Other
payables (Note 6)
|
|
15,810
|
|
|
4,386
|
|
Total Liabilities
|
|
216,523
|
|
|
961,420
|
|
|
|
|
|
|
|
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Commitments (Note 10)
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|
|
|
|
|
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Subsequent Events (Note 11)
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|
|
|
|
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Stockholders Equity
|
|
|
|
|
|
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Preferred Stock, 100,000,000 shares authorized, $0.00001
par value;
No shares issued and outstanding (Note 8)
|
|
|
|
|
|
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Common Stock, 250,000,000 shares
authorized, $0.00001 par value;
97,485,733 shares issued and
outstanding (March 31, 2011 - 96,346,900) (Note 8)
|
|
975
|
|
|
964
|
|
Additional Paid-in Capital
|
|
15,928,464
|
|
|
15,620,475
|
|
Common Stock and Warrants Issuable (Notes
8(c))
|
|
|
|
|
35,000
|
|
Accumulated other comprehensive loss
|
|
(110,000
|
)
|
|
|
|
Deficit Accumulated During the Exploration Stage
|
|
(12,361,154
|
)
|
|
(13,442,960
|
)
|
Total
Stockholders Equity
|
|
3,458,285
|
|
|
2,213,479
|
|
Total Liabilities and Stockholders Equity
|
|
3,674,808
|
|
|
3,174,899
|
|
The accompanying notes are an integral part of these unaudited
consolidated financial statements
F-2
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Consolidated Statements of Operations
|
(Expressed in US dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
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Accumulated From
|
|
|
|
|
|
|
|
|
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December 11, 2006
|
|
|
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Three Months Ended
|
|
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(Date of Inception) to
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
2011
|
|
|
2010
|
|
|
2011
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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|
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Expenses
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|
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|
|
|
|
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Amortization and depreciation
|
|
7,125
|
|
|
5,775
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45,227
|
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Exploration costs (Note 7)
|
|
53,056
|
|
|
104,453
|
|
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3,065,966
|
|
General and administrative
|
|
68,825
|
|
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30,441
|
|
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2,026,127
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Impairment of mineral property
acquisition costs
|
|
|
|
|
|
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11,143,091
|
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Management and director fees
|
|
5,000
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|
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31,500
|
|
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529,017
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Professional and consulting
fees
|
|
100,025
|
|
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312,316
|
|
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3,395,644
|
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Salaries
|
|
144,987
|
|
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24,783
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|
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288,669
|
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Stock-based compensation
|
|
|
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1,593,989
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Travel and accommodation
|
|
24,638
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|
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16,721
|
|
|
357,269
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating
Expenses
|
|
403,656
|
|
|
525,989
|
|
|
22,444,999
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
(403,656
|
)
|
|
(525,989
|
)
|
|
(22,444,999
|
)
|
|
|
|
|
|
|
|
|
|
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Other Income (Expenses)
|
|
|
|
|
|
|
|
|
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Gain on long-term investments
|
|
|
|
|
|
|
|
5,000
|
|
Foreign exchange loss
|
|
(3,163
|
)
|
|
(1,470
|
)
|
|
(88,927
|
)
|
Interest income
|
|
1,204
|
|
|
943
|
|
|
9,791
|
|
Interest expense
|
|
|
|
|
(106
|
)
|
|
(1,045
|
)
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Loss on debt settlement
|
|
|
|
|
|
|
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(63,752
|
)
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Other income
|
|
|
|
|
|
|
|
15,900
|
|
Income from options granted on mineral
properties (Note 7)
|
|
1,487,423
|
|
|
|
|
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1,487,423
|
|
Total Other Income
(Expenses)
|
|
1,485,464
|
|
|
(633
|
)
|
|
1,364,390
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
|
|
1,081,808
|
|
|
(526,622
|
)
|
|
(21,080,609
|
)
|
Net loss attributable to non-controlling interest
|
|
|
|
|
|
|
|
8,719,455
|
|
Net Income (Loss) Attributable to the Company
|
|
1,081,808
|
|
|
(526,622
|
)
|
|
(12,361,154
|
)
|
|
|
|
|
|
|
|
|
|
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
Unrealized holding loss on other
investment (Note 4)
|
|
(110,000
|
)
|
|
|
|
|
(110,000
|
)
|
|
|
|
|
|
|
|
|
|
|
Net Comprehensive Income (Loss)
|
|
971,808
|
|
|
(526,622
|
)
|
|
(12,471,154
|
)
|
|
|
|
|
|
|
|
|
|
|
Net Earnings (Loss) Per Share Basic and Diluted
|
|
0.01
|
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares Outstanding
|
|
96,472,046
|
|
|
69,020,764
|
|
|
|
|
The accompanying notes are an integral part of these unaudited
consolidated financial statements
F-3
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Consolidated Statements of Cash Flows
|
(Expressed in US dollars)
|
(Unaudited)
|
|
|
Three Months Ended
|
|
|
|
June 30,
|
|
|
|
2011
|
|
|
2010
|
|
|
|
$
|
|
|
$
|
|
Operating Activities
|
|
|
|
|
|
|
Net Income (Loss)
|
|
1,081,808
|
|
|
(526,622
|
)
|
Adjustments to reconcile net loss to cash
used in operating activities
|
|
|
|
|
|
|
Amortization and depreciation
|
|
7,125
|
|
|
5,775
|
|
Share payment for consulting
services
|
|
48,900
|
|
|
77,200
|
|
Share payments received for options granted on
mineral properties
|
|
(990,000
|
)
|
|
|
|
Changes in operating assets and
liabilities:
|
|
|
|
|
|
|
Increase in advances and deposits
|
|
(30,904
|
)
|
|
(26,484
|
)
|
Increase in amounts receivable
|
|
(337,429
|
)
|
|
|
|
Decrease in amounts due to related parties
|
|
(125,730
|
)
|
|
|
|
Increase in notes payable
|
|
|
|
|
11,522
|
|
Decrease in accounts payable
|
|
(12,008
|
)
|
|
(31,036
|
)
|
Decrease in accrued expenses
|
|
(119,539
|
)
|
|
|
|
Increase (Decrease) in other payables
|
|
11,423
|
|
|
(10,209
|
)
|
Net Cash Used In Operating Activities
|
|
(466,354
|
)
|
|
(499,854
|
)
|
|
|
|
|
|
|
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Investing Activities
|
|
|
|
|
|
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Acquisition of property and equipment
|
|
(15,994
|
)
|
|
(1,143
|
)
|
Cash payment for acquisition of mineral properties
|
|
(239,900
|
)
|
|
|
|
Net Cash Used In
Investing Activities
|
|
(255,894
|
)
|
|
(1,143
|
)
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
|
|
Proceeds from issuance of stock, net
|
|
|
|
|
625,870
|
|
Net Cash Provided
By Financing Activities
|
|
|
|
|
625,870
|
|
Net (Decrease) Increase In Cash
|
|
(722,248
|
)
|
|
124,873
|
|
Cash at Beginning
of Period
|
|
2,282,902
|
|
|
955,401
|
|
Cash at End of Period
|
|
1,560,654
|
|
|
1,080,274
|
|
|
|
|
|
|
|
|
Non-cash Investing and Financing Activities
|
|
|
|
|
|
|
Stock issued for services
|
|
48,900
|
|
|
|
|
Stock issued for subscription
receivable
|
|
|
|
|
20,000
|
|
Stock issued to settle debt
|
|
230,227
|
|
|
|
|
Stock issued for mineral interest
acquisition costs
|
|
224,100
|
|
|
|
|
Share payments received for options granted on
mineral properties
|
|
990,000
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures
|
|
|
|
|
|
|
Interest paid
|
|
|
|
|
106
|
|
Income taxes paid
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited
consolidated financial statements
F-4
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
1.
|
Nature of Operations
|
|
|
|
Lake Victoria Mining Company, Inc. (the Company) was
incorporated on December 11, 2006 under the laws of the State of Nevada.
The Companys administrative office is located in Vancouver, Canada. The
Company is an Exploration Stage Company, as defined by Financial
Accounting Standards Board (FASB) Accounting Standards Codification
(ASC) 915, Development Stage Entities. The Company has been in the
exploration stage since inception and has not yet realized any revenues
from its planned operations.
|
|
|
|
The principal business of the Company is to search for
mineral deposits or reserves which are not in either the development or
production stage. The Company is conducting exploration activities on gold
and uranium properties located in Tanzania.
|
|
|
|
As of June 30, 2011, none of the Companys mineral
property interests had proven or probable reserves as determined under the
requirements of SEC Industry Guide No. 7. Planned principal activities
have not yet begun. The ability of the Company to emerge from the
exploration stage with respect to any planned principal business activity
is dependent upon its successful efforts to raise additional debt or
equity financing and/or attain profitable mining operations. As shown in
the accompanying financial statements, the Company has an accumulated
deficit of $12,361,154 incurred through June 30, 2011. The Company has no
revenues. Management intends to seek additional capital from new equity
securities offerings that will provide funds needed to continue the
exploration for gold and uranium. The financial statements do not include
any adjustments relating to the recoverability and classification of
recorded assets, or the amounts and classification of liabilities that
might be necessary in the event the Company cannot continue as a going
concern. The Company expects to be able to meet its necessary cash
outflows for the next twelve months from working
capital.
|
2.
|
Summary of Significant Accounting Policies
|
|
|
|
|
a)
|
Basis of Presentation and Interim Financial
Statements
|
|
|
|
|
|
These consolidated financial statements and related notes
are presented in accordance with accounting principles generally accepted
in the United States, and are expressed in U.S. dollars. These
consolidated financial statements include the accounts of the Company and
its wholly-owned subsidiaries, Kilimanjaro Mining Company, Inc.
(Kilimanjaro), Lake Victoria Resources Company, (T) Ltd., Jin 179
Company Tanzania Ltd. and Chrysons 197 Company Tanzania Ltd. Significant
intercompany accounts and transactions have been eliminated. The Companys
fiscal year-end is March 31.
|
|
|
|
|
|
These interim unaudited financial statements have been
prepared in accordance with accounting principles generally accepted in
the United States for interim financial information and with the
instructions to Securities and Exchange Commission (SEC) Form 10-Q. They
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
Therefore, these financial statements should be read in conjunction with
the Companys audited financial statements and notes thereto for the year
ended March 31, 2011, included in the Companys Annual Report on Form 10-
K filed July 14, 2011 with the SEC.
|
|
|
|
|
|
The financial statements included herein are unaudited;
however, they contain all normal recurring accruals and adjustments that,
in the opinion of management, are necessary to present fairly the
Companys financial position at June 30, 2011, and the results of its
operations and cash flows for the three-month periods ended June 30, 2011
and 2010. The results of operations for the period ended June 30, 2011 are
not necessarily indicative of the results to be expected for future
quarters or the full year.
|
|
|
|
|
b)
|
Use of Estimates
|
|
|
|
|
|
The preparation of financial statements in accordance
with United States generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements
and the reported amounts of revenue and expenses in the reporting period.
The Company regularly evaluates estimates and assumptions related to
long-lived assets, mineral property costs, asset retirement obligations,
stock-based compensation, financial instrument valuations and deferred
income tax asset valuations. The Company bases its estimates and
assumptions on current facts, historical experience and various other
factors that it believes to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying
values of assets and liabilities and the accrual of costs and expenses
that are not readily apparent from other sources. The actual results
experienced by the Company may differ materially and adversely from the
Companys estimates. To the extent there are material differences between
the estimates and the actual results, future results of operations will be
affected.
|
F-5
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
2.
|
Summary of Significant Accounting Policies
(continued)
|
|
|
|
|
c)
|
Business Combinations
|
|
|
|
|
|
The Company follows the guidance in ASC 805, Business
Combinations, and ASC 810, Consolidation. The net loss attributable to
non-controlling interest recognized from inception to quarter ended June
30, 2011 was previously the minority interest held by certain passive
shareholders at the consolidated financial statement level of Kilimanjaro,
and whose interests were eliminated for accounting purposes by the August
7, 2009 share exchange agreement. The Company, after August 7, 2009, had
no further non-controlling interests.
|
|
|
|
|
|
As of June 30, 2011, a cumulative loss of $8,719,455 had
been attributed to the non-controlling interest of the Companys
controlled subsidiary.
|
|
|
|
|
d)
|
Basic and Diluted Net Income (Loss) Per Share
|
|
|
|
|
|
The Company computes net income (loss) per share in
accordance with ASC 260, Earnings per Share, which requires presentation
of both basic and diluted earnings per share (EPS) on the face of the
income statement. Basic EPS is computed by dividing net income (loss)
available to common shareholders (numerator) by the weighted average
number of shares outstanding (denominator) during the period. Diluted EPS
gives effect to all dilutive potential common shares outstanding during
the period using the treasury stock method and convertible preferred stock
using the if-converted method. In computing diluted EPS, the average stock
price for the period is used in determining the number of shares assumed
to be purchased from the exercise of stock options or warrants. Diluted
EPS excludes all dilutive potential shares if their effect is anti
dilutive. As of June 30, 2011, the Company had 45,604,901 dilutive
securities outstanding.
|
|
|
|
|
e)
|
Cash and Cash Equivalents
|
|
|
|
|
|
The Company considers all highly liquid instruments with
a maturity of three months or less at the time of issuance to be cash
equivalents.
|
|
|
|
|
|
As of June 30, 2011, the Company has approximately
$691,000 deposited at FDIC insured banks in the United States. FDIC
deposit insurance covers the balance of each depositors account up to
$250,000 per insured bank. As of June 30, 2011, the Company has
approximately $624,000 deposited in Canada. As of June 30, 2011, the
Company has 32,902,000 Tanzania Shillings (approximately $20,000) and
$225,700 deposited in Tanzania. The Deposit Insurance Board in Tanzania
insures up to 1,500,000 Tanzanian Shillings (approximately $915 as of June
30, 2011) per customer per bank. Any amount beyond the basic insurance
amount may expose the Company to loss.
|
|
|
|
|
f)
|
Property and Equipment
|
|
|
|
|
|
Property and equipment consists of mining tools and
equipment, motor vehicle, furniture and equipment and computers and
software which are depreciated on a straight line basis over their
expected lives of five years.
|
|
|
|
|
g)
|
Mineral Property Costs
|
|
|
|
|
|
Under US GAAP mineral property acquisition costs are
ordinarily capitalized when incurred using FASB ASC Topic 805-20-55-37,
Whether Mineral Rights are Tangible or Intangible Assets. The carrying
costs are assessed for impairment under ASC Topic 360-36-10-35-20,
Accounting for Impairment or Disposal of Long- Lived Assets, whenever
events or changes in circumstances indicate that the carrying costs may
not be recoverable. The Company expenses as incurred all property
maintenance and exploration costs.
|
|
|
|
|
|
The Company also evaluates the carrying value of acquired
mineral property rights in accordance with ASC Topic 930-360-35-1, Mining
Assets: Impairment and Business Combinations, using the Value Beyond
Proven and Probable (VBPP) method. The fair value of a mining asset
generally includes both VBPP and an estimate of the future market price of
the minerals.
|
|
|
|
|
|
When the Company has capitalized mineral property costs,
these properties will be periodically assessed for impairment of value.
Once a property reaches the production stage, the related capitalized
costs will be amortized, using the units of production method. During the
three months ended June 30, 2011, the Company records its interests in
mining properties and areas of geological interest at cost. The Company
has capitalized mineral properties costs of $464,000 and $Nil for the
three months ended at June 30, 2011 and 2010, respectively.
|
|
|
|
|
h)
|
Long-Lived Assets
|
|
|
|
|
|
In accordance with ASC 360, Property Plant and Equipment
the Company tests long-lived assets or asset groups for recoverability
when events or changes in circumstances indicate that their carrying
amount may not be recoverable. Circumstances which could trigger a review
include, but are not limited to: significant decreases in the market price
of the asset; significant adverse changes in the business climate or
legal
|
F-6
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
2.
|
Summary of Significant Accounting Policies
(continued)
|
|
|
|
|
h)
|
Long-Lived Assets (continued)
|
|
|
|
|
|
factors; accumulation of costs significantly in excess of
the amount originally expected for the acquisition or construction of the
asset; current period cash flow or operating losses combined with a
history of losses or a forecast of continuing losses associated with the
use of the asset; and current expectation that the asset will more likely
than not be sold or disposed significantly before the end of its estimated
useful life. Recoverability is assessed based on the carrying amount of
the asset and the sum of the undiscounted cash flows expected to result
from the use and the eventual disposal of the asset, as well as specific
appraisal in certain instances. An impairment loss is recognized when the
carrying amount is not recoverable and exceeds fair value.
|
|
|
|
|
i)
|
Asset Retirement Obligations
|
|
|
|
|
|
The Company accounts for asset retirement obligations in
accordance with the provisions of ASC 440, Asset Retirement and
Environmental Obligations which requires the Company to record the fair
value of an asset retirement obligation as a liability in the period in
which it incurs a legal obligation associated with the retirement of
tangible long-lived assets that result from the acquisition, construction,
development and/or normal use of the assets. The Company did not have any
asset retirement obligations as of June 30, 2011.
|
|
|
|
|
j)
|
Financial Instruments
|
|
|
|
|
|
ASC 825, Financial Instruments requires an entity to
maximize the use of observable inputs and minimize the use of unobservable
inputs when measuring fair value. ASC 825 establishes a fair value
hierarchy based on the level of independent, objective evidence
surrounding the inputs used to measure fair value. A financial
instruments categorization within the fair value hierarchy is based upon
the lowest level of input that is significant to the fair value
measurement. ASC 825 prioritizes the inputs into three levels that may be
used to measure fair value:
|
|
|
|
|
|
Level 1
|
|
|
|
|
|
Level 1 applies to assets or liabilities for which there
are quoted prices in active markets for identical assets or
liabilities.
|
|
|
|
|
|
Level 2
|
|
|
|
|
|
Level 2 applies to assets or liabilities for which there
are inputs other than quoted prices that are observable for the asset or
liability such as quoted prices for similar assets or liabilities in
active markets; quoted prices for identical assets or liabilities in
markets with insufficient volume or infrequent transactions (less active
markets); or model-derived valuations in which significant inputs are
observable or can be derived principally from, or corroborated by,
observable market data.
|
|
|
|
|
|
Level 3
|
|
|
|
|
|
Level 3 applies to assets or liabilities for which there
are unobservable inputs to the valuation methodology that are significant
to the measurement of the fair value of the assets or
liabilities.
|
|
|
|
|
|
The Companys financial instruments consist principally
of cash, advances and deposits, amounts receivable, short-term
investments, accounts payable, and other payables.
|
|
|
|
|
|
Pursuant to ASC 825, the fair values of cash and
short-term investments are determined based on Level 1 inputs, which
consist of quoted prices in active markets for identical assets. The
Company believes that the recorded values of advances and deposits,
amounts receivable, accounts payable, and other payables approximate their
current fair values because of their nature and respective relatively
short maturity dates or durations.
|
|
|
|
|
|
Assets measured at fair value on a recurring basis were
presented on the Companys balance sheet as of June 30, 2011 as
follows:
|
F-7
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
2.
|
Summary of Significant Accounting Policies (continued) j)
Financial Instruments (continued)
|
|
|
|
Fair Value Measurements Using
|
|
|
|
|
Quoted Prices in
|
|
|
Significant
|
|
|
|
|
|
|
|
|
|
|
Active Markets
|
|
|
Other
|
|
|
Significant
|
|
|
|
|
|
|
|
For Identical
|
|
|
Observable
|
|
|
Unobservable
|
|
|
Balance
|
|
|
|
|
Instruments
|
|
|
Inputs
|
|
|
Inputs
|
|
|
June 30,
|
|
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
|
2011
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
1,560,654
|
|
|
|
|
|
|
|
|
1,560,654
|
|
|
Short- term Investments
|
|
880,000
|
|
|
|
|
|
|
|
|
880,000
|
|
|
|
|
2,440,654
|
|
|
|
|
|
|
|
|
2,440,654
|
|
k)
|
Foreign Currency Translation
|
|
|
|
The Companys functional and reporting currency is the
United States dollar. Monetary assets and liabilities denominated in
foreign currencies are translated to United States dollars in accordance
with ASC 740, Foreign Currency Matters, using the exchange rate prevailing
at the balance sheet date. Gains and losses arising on translation or
settlement of foreign currency denominated transactions or balances are
included in the determination of income.
|
|
|
|
To the extent that the Company incurs transactions that
are not denominated in its functional currency, they are undertaken in
Canadian dollars and the Tanzanian Schilling. A portion of business
transactions in Tanzania and mineral option purchase agreements are
denominated in the Tanzanian Schilling. The Company has not, to the date
of these financials statements, entered into derivative instruments to
offset the impact of foreign currency fluctuations.
|
|
|
l)
|
Segment Information
|
|
|
|
At June 30, 2011, $91,000 of property and equipment and
$464,000 of mineral properties are located in Tanzania. Although Tanzania
is considered economically stable, it is always possible that
unanticipated events in foreign countries could disrupt the Companys
operations.
|
|
|
m)
|
Comprehensive Loss
|
|
|
|
ASC 220, Comprehensive Income, establishes standards for
the reporting and display of other comprehensive loss and its components
in the consolidated financial statements. As at June 30, 2011 and 2010,
the Company had unrealized loss on short-term investments of $110,000 and
$nil, respectively, that represent other comprehensive loss.
|
|
|
n)
|
Income Taxes
|
|
|
|
The Company accounts for income taxes using the asset and
liability method in accordance with ASC 740, Income Taxes. The asset and
liability method provides that deferred tax assets and liabilities are
recognized for the expected future tax consequences of temporary
differences between the financial reporting and tax bases of assets and
liabilities, and for operating loss and tax credit carryforwards. Deferred
tax assets and liabilities are measured using the currently enacted tax
rates and laws that will be in effect when the differences are expected to
reverse. The Company records a valuation allowance to reduce deferred tax
assets to the amount that is believed more likely than not to be realized
.
|
|
|
o)
|
Stock-Based Compensation
|
|
|
|
The Company records stock -based compensation in
accordance with ASC 718, Compensation Stock Based Compensation and ASC
505, Equity Based Payments to Non -Employees, which requires the
measurement and recognition of compensation expense based on estimated
fair values for all share-based awards made to employees and directors,
including stock options.
|
|
|
|
ASC 718 requires companies to estimate the fair value of
share-based awards on the date of grant using an option-pricing model. The
Company uses the Black-Scholes option-pricing model as its method of
determining fair value. This model is affected by the Companys stock
price as well as assumptions regarding a number of subjective variables.
These subjective variables include, but are not limited to the Companys
expected stock price volatility over the term of the awards, and actual
and projected employee stock option exercise
|
F-8
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
2.
|
Summary of Significant Accounting Policies
(continued)
|
|
|
|
|
o)
|
Stock-Based Compensation (continued)
|
|
|
|
|
|
behaviours. The value of the portion of the award that is
ultimately expected to vest is recognized as an expense in the statement
of operations over the requisite service period.
|
|
|
|
|
|
All transactions in which goods or services are the
consideration received for the issuance of equity instruments are
accounted for based on the fair value of the consideration received or the
fair value of the equity instrument issued, whichever is more reliably
measurable.
|
|
|
|
|
p)
|
Recent Accounting Pronouncements
|
|
|
|
|
|
The Company has evaluated all recent accounting
pronouncements and determined that they would not have a material impact
on the Companys financial statements or disclosures.
|
|
|
|
|
q)
|
Reclassifications
|
|
|
|
|
|
Certain reclassifications have been made to the prior
periods financial statements to conform to the current periods
presentation.
|
|
|
|
3.
|
Related Party Transactions and Balances
|
|
|
|
|
a)
|
Prior to incorporation of the Companys wholly-owned
subsidiary in Tanzania, the Company contracted with Geo Can Resources
Company Ltd (Geo Can), a related company with a shared common director, to
perform exploration services on all of the properties. On June 1, 2011,
the Company paid Geo Can $121,480 which was the difference between amounts
owing for exploration services totalling $620,523 and advances of $499,043
made to Geo Can through Companys subsidiary, Kilimanjaro Mining
Company.
|
|
|
|
|
|
As of June 30, 2011, the Company owed $Nil (March 31,
2011 - $121,480) to Geo Can for exploration services provided.
|
|
|
|
|
b)
|
During the three months ended June 30, 2011, the Company
incurred $5,000 (2010 - $6,000) of directors fees to a Director of the
Company.
|
|
|
|
|
c)
|
During the three months ended June 30, 2011, the Company
incurred $1,050 (2010 - $nil) of accounting fees to an Officer of the
Company.
|
|
|
|
|
d)
|
During the three months ended June 30, 2011, the Company
incurred $10,500 (2010 - $30,000) of geologist consulting fees to a
Director of the Company.
|
|
|
|
|
e)
|
As at June 30, 2011, the Company held $9,710 in trust
with a company sharing a common director, which has been included in
advances and deposits.
|
|
|
|
4.
|
Short-term Investments
|
|
|
|
June 30, 2011
|
|
|
March 31, 2011
|
|
|
|
|
|
|
|
Carrying
|
|
|
|
|
|
Carrying
|
|
|
|
|
Cost
|
|
|
Value
|
|
|
Cost
|
|
|
Value
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
Otterburn Ventures Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,200,000 common shares
|
|
990,000
|
|
|
880,000
|
|
|
|
|
|
|
|
|
|
|
990,000
|
|
|
880,000
|
|
|
|
|
|
|
|
The Company classifies its short-term investments as
available-for-sale securities and carries them at fair value. The Company
determines fair values for investments in public companies using quoted market
prices with unrealized gains and losses included in accumulated other
comprehensive income or loss. Realized gains and losses and unrealized losses
that are other than temporary are recognized in earnings.
F-9
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
5.
|
Property and Equipment
|
|
|
|
At June 30, 2011 and March 31, 2011, property and
equipment consisted of the following:
|
|
|
|
As at June 30, 2011
|
|
|
As at March 31, 2011
|
|
|
|
|
|
|
|
Accumulated
|
|
|
Net Book
|
|
|
|
|
|
Accumulated
|
|
|
Net Book
|
|
|
|
|
Cost
|
|
|
Amortization
|
|
|
Value
|
|
|
Cost
|
|
|
Amortization
|
|
|
Value
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
Mining tools and equipment
|
|
101,885
|
|
|
30,362
|
|
|
71,523
|
|
|
101,495
|
|
|
25,278
|
|
|
76,217
|
|
|
Vehicle
|
|
12,800
|
|
|
213
|
|
|
12,587
|
|
|
|
|
|
|
|
|
|
|
|
Furniture and equipment
|
|
10,101
|
|
|
2,150
|
|
|
7,951
|
|
|
10,101
|
|
|
1,794
|
|
|
8,307
|
|
|
Computer and software
|
|
32,611
|
|
|
12,502
|
|
|
20,109
|
|
|
29,808
|
|
|
11,030
|
|
|
18,778
|
|
|
|
|
157,397
|
|
|
45,227
|
|
|
112,170
|
|
|
141,404
|
|
|
38,102
|
|
|
103,302
|
|
6.
|
Other Payables
|
|
|
|
As of June 30, 2011 and March 31, 2011, the Company
withheld payroll deductions of $15,810 and $4,386, respectively, to
conform to local tax law.
|
|
|
7.
|
Mineral Property Acquisition and Exploration
Costs
|
|
|
|
On May 4, 2009, Kilimanjaro completed a Property
Acquisition Agreement (the Geo Can Agreement) with Geo Can (a related
party, see Note 3) . Under the terms of the agreement Kilimanjaro acquired
a 100% interest in the mineral property assets, which included 33 gold
prospecting licenses and 13 uranium licenses. Included in this agreement
were the Kalemela projects licenses, Geita projects license, Uyowa
Projects licenses, Kinyambwiga projects license and other projects
licences. Geo Can had entered into property option agreements, regarding
some of these resource properties, with Lake Victoria before the share
exchange agreement between Lake Victoria and Kilimanjaro on August 7,
2009, and as a consequence Geo Can no longer has any interest in those
prior property agreements.
|
|
|
|
The mineral property acquisition costs are capitalized
and the carrying values are periodically assessed for impairment of value
and any diminution in value. When a property reaches the development
stage, the related costs will be capitalized and amortized, using the
units of production method on the basis of periodic estimates of ore
reserves. Costs to maintain the mineral rights and leases are expensed as
incurred.
|
|
|
|
All of the Companys mineral property interests are
located in Tanzania. Geo Can holds resource properties in trust for the
Company. Most of the resource property interests are still formally
registered to Geo Can to save on registration fees. When the annual filing
for each property comes due then the formal registration of each property
will be transferred to Kilimanjaro or as directed by
Kilimanjaro.
|
|
|
|
The following is a continuity of mineral property
acquisition costs (recoveries) accumulated from
inception:
|
|
|
Kalemela
Gold
Project
|
|
|
Geita
Project
|
|
|
Kinyambwiga
Project
|
|
|
Singida
Project
|
|
|
North
Mara
|
|
|
Handeni
Project
|
|
|
Buhemba
Project
|
|
|
Other
Projects
|
|
|
Total
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
(a)
|
|
|
(b)
|
|
|
(c)
|
|
|
(e)
|
|
|
(g)
|
|
|
(h)
|
|
|
(i)
|
|
|
|
|
|
|
|
March 31, 2011
|
|
3,643,125
|
|
|
2,752,608
|
|
|
1,922,608
|
|
|
1,707,8 10
|
|
|
135,648
|
|
|
-
|
|
|
-
|
|
|
981,292
|
|
|
11,143,091
|
|
Related payments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Consideration
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
120,250
|
|
|
119,650
|
|
|
-
|
|
|
239,900
|
|
Share issued
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
116,100
|
|
|
108,000
|
|
|
-
|
|
|
224,100
|
|
Recovery from option payment-cash
|
|
(61,898
|
)
|
|
(42,740
|
)
|
|
-
|
|
|
(300,770
|
)
|
|
(92,015
|
)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(497,423
|
)
|
Recovery
from option payment-shares
|
|
(135,000
|
)
|
|
(135,000
|
)
|
|
-
|
|
|
(495,000
|
)
|
|
(225,000
|
)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(990,000
|
)
|
|
|
(196,898
|
)
|
|
(177,740
|
)
|
|
-
|
|
|
(795,770
|
)
|
|
(317,015
|
)
|
|
236,350
|
|
|
227,650
|
|
|
-
|
|
|
(1,023,423
|
)
|
June 30,
2011
|
|
3,446,227
|
|
|
2,574,868
|
|
|
1,922,608
|
|
|
912,040
|
|
|
(181,367
|
)
|
|
236,350
|
|
|
227,650
|
|
|
981,292
|
|
|
10,119,668
|
|
F-10
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
7.
|
Mineral Property Acquisition and Exploration Costs
(continued)
|
|
|
|
The following is a continuity of mineral property
exploration costs accumulated from inception:
|
|
Kalemela
$
(a)
|
Geita
$
(b)
|
Kinyamb
wiga
$
(c)
|
Suguti
$
(d)
|
Singida
$
(e)
|
Uyowa
$
(f)
|
North
Mara
$
(g)
|
Handeni
$
(h)
|
Behem
ba
$
(i)
|
Other
Project
$
|
Total
$
|
Balance, March 31, 2011
|
640,404
|
415,789
|
494,861
|
51,640
|
1,319,8 84
|
36,287
|
31,744
|
-
|
-
|
22,303
|
3,012,912
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration expenditures:
|
|
|
|
|
|
|
|
|
|
|
|
Camp, Field Supplies and Travel
|
-
|
-
|
6,224
|
5,073
|
17,783
|
1,278
|
1,488
|
3,904
|
-
|
5
|
35,755
|
Drilling Cost
|
-
|
-
|
-
|
-
|
364,159
|
-
|
-
|
-
|
-
|
-
|
364,159
|
Geological consulting and Wages
|
138
|
1,842
|
21,797
|
11,600
|
75,161
|
7,706
|
7,351
|
6,367
|
733
|
1,022
|
133,717
|
Geophysical and Geochemical
|
-
|
-
|
740
|
4,477
|
41,871
|
15,544
|
-
|
-
|
-
|
(246)
|
62,386
|
Parts and equipment
|
-
|
-
|
5,804
|
637
|
642
|
32
|
39
|
188
|
-
|
-
|
7,342
|
Vehicle and Fuel expenses
|
-
|
-
|
6,071
|
7,622
|
8,729
|
2,755
|
3,119
|
1,494
|
-
|
-
|
29,790
|
Expense reimbursements
|
-
|
-
|
-
|
-
|
(580,095)
|
-
|
-
|
|
-
|
-
|
(580,097)
|
|
138
|
1,842
|
40,636
|
29,409
|
(71,750)
|
27,315
|
11,997
|
11,953
|
733
|
781
|
53,054
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, June 30, 2011
|
640,542
|
417,631
|
535,497
|
81,049
|
1,248,1 34
|
63,602
|
43,741
|
11,953
|
733
|
23,084
|
3,065,966
|
|
a)
|
Kalemela Gold Project
|
|
|
|
|
|
As a part of the Geo Can Agreement, Kilimanjaro owns 100%
interest in the Kalemela Gold Projects three prospecting licenses
PL2747/2004, PL3006/2005 and PL2910/2004. The original three prospecting
licenses have been divided and the project is now comprised of six
licenses: PL2747/2004, PL3006/2005, PL2910/2004, PL5892/2009, PL5912/2009
and PL5988/2009. The Kalemela Gold Project is located within the
Southeastern Lake Victoria Goldfields in Northern Tanzania in Magu
District, Mwanza Region.
|
|
|
|
|
|
On May 6, 2011, the Company entered into an option and
joint venture agreement with Otterburn. On May 20, 2011, the Company
received option payment of $61,898 in cash and 300,000 common shares of
Otterburn with a fair value of $135,000. On July 8, 2011, Otterburn
terminated the option and joint venture agreement. Refer to Note 11(b)
.
|
|
|
|
|
b)
|
Geita Project
|
|
|
|
|
|
As a part of the Geo Can Agreement, the Company owns 100%
interest in the Geita projects one prospecting license as at March 31,
2011. The original prospecting license PL2806 has been divided and the
project is now comprised of two licenses: PL2806/2004 and PL5958/2009. The
Geita Gold Project is located in Northern Tanzania within the Lake
Victoria Goldfields in the Geita District, Mwanza Region.
|
|
|
|
|
|
On May 6, 2011, the Company entered into an option and
joint venture agreement with Otterburn. On May 20, 2011, the Company
received option payment of $42,740 in cash and 300,000 common shares of
Otterburn with a fair value of $135,000. On July 8, 2011, Otterburn
terminated the option and joint venture agreement. Refer to Note 11(b)
.
|
|
|
|
|
c)
|
Musoma Bunda - Kinyambwiga Project
|
|
|
|
|
|
The Musoma Bunda Gold Project comprise of three
prospecting licences that are located on the eastern side of Lake
Victoria.
|
|
|
|
|
|
Kinyambwiga project is part of the Musoma Bunda Gold
Project. As a part of the Geo Can Agreement, the Company owns 100%
interest of Kinyambwiga projects one prospecting license and 24 primary
mining licenses. The Kinyambwiga Gold Project is about 208 kilometers
northeast of the city of Mwanza in northern Tanzania.
|
|
|
|
|
|
A director of the Company entered into Mineral Purchase
agreements on behalf of the Company with 24 Primary Mining Licenses (PMLs)
which are part of the Kinyambwiga Project and which are recorded in his
name and are to be transferred over to the Company at a future
date.
|
|
|
|
|
d)
|
Musoma Bunda - Suguti Project
|
|
|
|
|
|
Suguti project is part of the Musoma Bunda Gold Project.
As a part of the Geo Can Agreement, the Company owns 100% interest of
Suguti projects one prospecting license.
|
F-11
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
7.
|
Mineral Property Acquisition and Exploration Costs
(continued)
|
|
|
|
|
e)
|
Singida Project
|
|
|
|
|
|
On May 15, 2009, the Company signed a Mineral Financing
Agreement with one director of the Company authorizing him, on behalf of
the Company, to acquire Primary Mining Licenses (PMLs) in the Singida
area. As of December 31, 2010, this director has entered into Mineral
Properties Sales and Purchase agreements with various PML owners. The
Company has 100% acquired 23 PML agreements. The Company has the option to
acquire 37 additional and different PMLs in the Singida area. Under the
terms of these agreements, if the option to purchase is completed on all
these PMLs, then the total purchase consideration would be approximately
$6,037,058 (TZS9,896,816,657,outstanding option payments in US Dollar
amount is estimated with an exchange rate of 0.00061 as at June 30, 2011),
payable by February 24, 2013.
|
|
|
|
|
|
In September 2009, pursuant to the agreement, the Company
completed an Addendum to the Mineral Properties and Sale and provided
notification to all the PML owners involved in Singida Mineral Properties
and Sale Agreements that the Company would extend their due diligence
period for an additional 120 days as upon paying $48,782.
|
|
|
|
|
|
On January 19, 2010, a director on behalf of the Company
signed second addendums to Singida mineral properties sales and purchase
agreements. The addendums revised and extended the second payment of the
mineral agreements. The second payment was divided into three payments
with $470,927 due on January 27, 2010, $470,927 due on July 27, 2010 and
$922,900, due on January 27, 2011.
|
|
|
|
|
|
On July 27, 2010, the director signed third addendums to
the Singida mineral properties sales and purchase agreements on behalf of
the Company. The third addendums revised the payment terms of the second
addendum. Based on the revised terms, the second instalment of $470,927
was divided into two payments, with $281,065 due on July 27, 2010 and
$187,426 due on October 24, 2010. The Company made the payment of $281,065
on July 27, 2010, and the payment of $187,426 on October 26,
2010.
|
|
|
|
|
|
On February 7, 2011, a director signed fourth addendums
to the Singida mineral properties sales and purchase agreements on behalf
of the Company. The fourth addendums revised the payment terms of the
second addendum. Based on the revised terms, the third instalment of
approximately $922,900 was divided into three payments, with $92,065 paid
on February 9, 2011, $181,998 paid on March 10, 2011 and $646,030 due on
August 9, 2011.
|
|
|
|
|
|
At the option of the Company, any PMLs may be
relinquished at any time during the agreement and the title transferred
back to the original owner. Also, at the option of the Company, a 2% Net
Smelter Production royalty or 2% of the Net Sale Value may be substituted
in place of the final payment for each PML and paid on a pro rata basis
determined by the total final number of PMLs involved in a special mining
license.
|
|
|
|
|
|
As of June 30, 2011, under the terms of the mineral
properties sales and purchase agreements the Company has completed initial
option payments in the amount of $1,707,810. Pursuant to the original
agreement and the subsequent addendums, the Company will pay approximately
$646,030 on August 9, 2011, approximately $419,100 on January 23, 2013 and
$3,828,000 on February 24, 2013.
|
|
|
|
|
|
On May 6, 2011, the Company entered into an option and
joint venture agreement with Otterburn. On May 20, 2011, the Company
received option payment of $300,770 in cash and 1,100,000 common shares of
Otterburn with a fair value of $495,000.
|
|
|
|
|
|
On June 21, 2011, Lake Victoria Resources, a subsidiary
of the Company, entered into a service agreement with Otterburn to perform
all recommended exploration work on optioned properties. As per the
agreement, Otterburn agreed to reimburse exploration costs incurred on
Singida project from March 2011 up to the day of termination . As of June
30, 2011, the balance of reimbursement cost from Otterburn was
$616,296.
|
|
|
|
|
|
On July 8, 2011, Otterburn terminated the option and
joint venture agreement and services agreement. Refer to Note
11(b).
|
|
|
|
|
f)
|
Uyowa Project
|
|
|
|
|
|
As a part of the Geo Can Agreement the Company owns 100%
interest in the Uyowa projects prospecting licenses. The Uyowa Gold
project consists of seven prospecting licenses.
|
F-12
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
7.
|
Mineral Property Acquisition and Exploration Costs
(continued)
|
|
|
|
|
|
g)
|
North Mara Project
|
|
|
|
|
|
|
During the year, there are three prospecting licenses
expired. As of March 31, 2011, the North Mara Project comprised of nine
prospecting licenses.
|
|
|
|
|
|
|
On May 6, 2011, the Company entered into an option and
joint venture agreement with Otterburn. On May 20, 2011, the Company
received option payment of $92,015 in cash and 500,000 common stock of
Otterburn with a fair value of $225,000.
|
|
|
|
|
|
|
On July 8, 2011, Otterburn terminated the option and
joint venture agreement. Refer to Note 11(b).
|
|
|
|
|
|
h)
|
Handeni Project
|
|
|
|
|
|
|
Currently, Handeni Project Uranium Project is comprised
of three prospecting licenses.
|
|
|
|
|
|
|
On April 20, 2011, the Company signed license purchase
agreements to acquire one prospecting license. The total consideration was
$113,250, of which $77,250 was paid on April 29, 2011 and $36,000 is due
on receipt of license. On June 14 and June 20, 2011 the Company paid a
finders fee of $30,000 in cash and issued 400,000 common shares with a
fair value of $108,000.
|
|
|
|
|
|
|
On May 30, 2011, the Company signed prospecting licence
purchase agreements to acquire one prospecting license. The total
consideration includes:
|
|
|
|
|
|
|
1)
|
paying $10,000 within 5 days after execution date. The
payment was made on June 16, 2011;
|
|
|
|
|
|
|
2)
|
paying a total amount of $450,000 to the owner of the
license, of which $70,000 due in 2011, $170,000 due in 2012 and $200,000
due in 2013
|
|
|
|
|
|
|
3)
|
paying a finders fee of $30,000 and 300,000 common
shares. On June 14 and 20, 2011, the Company paid $3,000 in cash and
issued 30,000 common shares with a fair value of $8,100.
|
|
|
|
|
|
|
On July 1, 2011, the Company entered into a prospecting
license purchase agreement to acquire one prospecting license. Refer to
Note 11(b).
|
|
|
|
|
|
i)
|
Buhemba Project
|
|
|
|
|
|
|
Buhemba Project consists of two prospecting licenses. One
prospecting license is a part of the Geo Can Agreement the Company owns
100% interest.
|
|
|
|
|
|
|
On April 20, 2011, the Company signed license purchase
agreements to acquire one prospecting license. The total consideration was
$112,150, of which $89,650 was paid on April 29, 2011 and $22,500 is due
on receipt of license. On June 14 and June 20, 2011 the Company paid a
finders fee of $30,000 in cash and issued 400,000 common shares with a
fair value of $108,000.
|
|
|
|
|
|
j)
|
Mbinga Project
|
|
|
|
|
|
|
The Mbinga Uranium Project is comprised of three
prospecting licenses and two Reconnaissance Licenses. The Reconnaissance
Licenses, located along the eastern shoreline of Lake Nyasa are currently
under application.
|
|
|
|
|
|
|
As of June 30, 2011, the Company owns 100% interest of
Mbinga projects prospecting licenses.
|
|
|
|
|
8.
|
Capital Stock
|
|
|
|
|
|
Preferred Stock
|
|
|
|
|
|
The Company is authorized to issue 100,000,000 shares of
preferred stock with a par value of $0.00001. As of June 30, 2011, the
Company has not issued any preferred stock.
|
|
|
|
|
|
Common Stock
|
|
|
|
|
|
On December 7, 2010, the Companys shareholders approved
a resolution to amend the Companys articles of incorporation to increase
the number of authorized shares of common stock from 100,000,000 shares to
250,000,000 shares. All shares have equal voting rights, are
non-assessable and have one vote per share.
|
F-13
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
8.
|
Capital Stock (continued)
|
|
|
|
|
Common Stock
(continued)
|
|
|
|
|
a)
|
On April 20 and May 30, 2011, the Company entered into
three prospecting licences purchase agreements to acquire three
prospecting licenses. As per the agreements, the Company agreed to pay a
finders fee of 830,000 common shares. On June 20, 2011, the Company
issued 830,000 common shares with a fair value of $224,100 as finders fee
to a company.
|
|
|
|
|
b)
|
On April 8, 2011, the Company signed a debt settlement
agreement with a consultant to settle a consulting fee of $80,614 for
geological and business development services provided. The Company agreed
to pay $31,714 cash and issue 163,000 shares with a market value of
$48,900 to settle the outstanding balance. On June 20, 2011, the Company
issued the shares to the consultant.
|
|
|
|
|
c)
|
On February 24, 2011, the Company signed debt settlement
and subscription agreement with a director to settle a consulting fee of
$35,000 in exchange for 145,833 shares of common stock at $0.24 per share.
On June 20, 2011, the Company issued the shares to the director.
|
|
|
|
9.
|
Stock Options and Warrants
|
|
|
|
|
On October 7, 2010, the Company adopted the 2010 Stock
Option Plan under which the Company is authorized to grant stock options
to acquire up to a total of 10,000,000 shares of common stock.
|
|
|
|
|
The following table summarizes the continuity of the
Companys stock options:
|
|
|
|
|
|
|
|
|
|
Weighted-
|
|
|
|
|
|
|
|
|
|
|
Weighted
|
|
|
Average
|
|
|
|
|
|
|
|
|
|
|
Average
|
|
|
Remaining
|
|
|
Aggregate
|
|
|
|
|
Number of
|
|
|
Exercise
|
|
|
Contractual
|
|
|
Intrinsic
|
|
|
|
|
Options
|
|
|
Price
|
|
|
Life (years)
|
|
|
Value
|
|
|
|
|
|
|
|
$
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding, March 31, 2011
|
|
4,200,000
|
|
|
0.45
|
|
|
|
|
|
|
|
|
Granted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercised
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expired
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding, June
30, 2011
|
|
4,200,000
|
|
|
0.45
|
|
|
2.31
|
|
|
2,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercisable, June
30, 2011
|
|
4,200,000
|
|
|
0.45
|
|
|
2.31
|
|
|
2,400
|
|
At June 30 and March 31, 2011, the
Company did not have any unvested options.
The Company had the following warrants
outstanding as of June 30, 2011:
|
|
Exercise Price per
|
|
|
|
|
|
|
Share
|
|
|
Shares Issuable
|
|
Expiration Date
|
|
$
|
|
|
Upon Exercise
|
|
|
|
|
|
|
|
|
September 7, 2011
|
|
0.30
|
|
|
20,000,000
|
|
September 9, 2012
|
|
1.25
|
|
|
1,350,501
|
|
January 28, 2013
(1)
|
|
1.25
|
|
|
10,473,000
|
|
August 13, 2013
(2)
|
|
0.40
|
|
|
4,790,700
|
|
August 13, 2013
(2)
|
|
0.60
|
|
|
4,790,700
|
|
|
|
|
|
|
41,404,901
|
|
(1)
These redeemable
warrants are callable by the Company upon 30 days written notice to the warrant
holder. If the redeemable warrants are not exercised within 30 days of being
called, they will terminate and may not be exercised thereafter.
(2)
These redeemable
warrants are callable by the Company upon 20 days written notice to the warrant
holder. If the redeemable warrants are not exercised within 20 days of being
called, they will terminate and may not be exercised thereafter.
F-14
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
10.
|
Commitments
|
|
|
|
|
|
a)
|
On May 15, 2009, Kilimanjaro signed a Mineral Financing
Agreement with a director of the Company authorizing him, on behalf of the
Company, to acquire Primary Mining Licenses (PMLs) in the Singida area of
Tanzania. As of June 30, 2011, this director has entered into Mineral
Properties Sales and Purchase agreements with various PML owners of which
23 PML Option to Purchase agreements have been completed. These PMLs have
been 100% acquired and the Company has the option to acquire 37 additional
and different PMLs in the Singida area. Under the terms of these
agreements, if the option to purchase is completed on all these PMLs, then
the total purchase consideration will be approximately $6,432,930 (see
Note 7(e)).
|
|
|
|
|
|
b)
|
The same director of the Company entered into Mineral
Purchase agreements with 24 PMLs which are part of the Kinyambwiga
Project and which are recorded in his name and are to be transferred over
to the Company at a future date (see Note 7(c)).
|
|
|
|
|
|
c)
|
On December 31, 2009, the Company entered into a
Geological and Business Development Consulting Services Agreement with
Jack V. Everett (Everett) under which Everett will provide public
relations, geological, and consulting services to us and the Company
agrees to compensate Everett on a quarterly basis in two methods: (a) cash
and (b) restricted common shares of the Company. The quarterly
compensation will be agreed upon, in advance of each quarter, by the
Company and Everett . Accordingly, upon execution of the agreement the
Company paid Everett a cash payment of $20,000 and issued him 68,775
restricted common shares valued at $42,641. On May 10, 2010, the Company
paid Everett a cash payment of $21,265 and on April 7, 2010 issued him
153,525 restricted common shares valued at $50,000. On November 9, 2010,
the Company issued him 217,100 restricted common shares for services
provided valued at $54,275 . The term of the consulting agreement is
twelve months. As of June 30, 2011, the Company paid Everett a cash
payment of $31,714 and issued him 163,000 restricted common shares valued
at $48,900 for services rendered for the period from October 2010 to March
31, 2011.
|
|
|
|
|
|
d)
|
On January 4, 2010, the Company entered into a finders
fee agreement with Robert A. Young, The RAYA Group (Young) wherein we
agreed to pay Young fees limited to introductions that Young makes to the
Company of investors who invest in the Companys private placements or
become involved with the Company through joint venture property
agreements. No Finders fees will be paid in connection with any
introduction to any existing contacts of the Company. The fee will be 10%
of the first $10,000,000 and 5% of amounts in excess of $10,000,000. The
term of the finders fee agreement is five years.
|
|
|
|
|
|
e)
|
On May 11, 2010, the Company entered into an agreement
with a consultant to provide services as a Senior Geological Consultant.
In consideration of the foregoing the Company will pay a base compensation
of $15,000 per month for the first six months, to be increased to $20,000
per month after the initial six months; eligibility of a bonus of 100,000
shares of common stock at the end of six months; and at the end of 12
months the Company will grant the consultant 300,000 stock options. On
November 9, 2010, the Company issued 100,000 shares of common stock to the
consultant. On October 21, 2010, the Company passed a board resolution to
grant the Consultant 500,000 stock options at an exercise price of $0.45
per share. On November 11, 2010, the Company signed an amendment with the
consultant to the original May 11th consulting agreement. The amendment
extended the term of the agreement to three years and the Company agreed
to pay $17,500 per month for the first 12 months and $20,000 per month
thereafter. The Company will grant the Consultant 300,000 stock options on
November 1, 2011, 2012 and 2013.
|
|
|
|
|
|
f)
|
On October 7, 2010, the Company entered into a consulting
agreement with Misac Noubar Nabighian to provide geophysical data
processing and geophysical data interpretation services to the Company in
consideration for:
|
|
|
|
|
|
|
i.
|
granting the Consultant an option to acquire 120,000
shares of common stock of the Company pursuant to the terms of the
Companys 2010 Stock Option Plan, at an exercise price of $0.29 per share,
exercisable until October 7, 2013 and vesting immediately. On October 7,
2010, the Company granted 120,000 options to the Consultant;
|
|
|
|
|
|
|
ii.
|
paying the Consultant 0.5% of the net proceeds from the
sale of any mining properties;
|
|
|
|
|
|
|
iii.
|
granting the Consultant a royalty on producing properties
as follows: (a) $ 1.00 per ounce of gold produced or 0.25% of net smelter
returns (as such term is defined in the Agreement), whichever is greater,
and (b) 0.25% of net smelter returns for all other commercial
production.
|
|
|
|
|
|
|
The agreement is for a term of 36 months and may be
renewed at the option of the Company upon 30 days written
notice.
|
F-15
Lake Victoria Mining Company, Inc.
|
(An Exploration Stage Company)
|
Notes to the Consolidated Financial Statements
|
June 30, 2011
|
(Expressed in US dollars)
|
(Unaudited)
|
10.
|
Commitments (continued)
|
|
|
|
|
|
g)
|
On April 26, 2011, the Company entered into two
consulting agreements to provide consulting services commencing April 1,
2011 for a period of two years. The Company will pay one consultant
Cdn$10,000 per month, and will grant 500,000 stock options annually at
each anniversary of the agreement. The Company will pay the second
consultant $3,500 per month, and will grant 250,000 stock options annually
at each anniversary of the agreement.
|
|
|
|
|
|
h)
|
On April 26, 2011, the Company entered into two
employment agreements for the positions of Corporate Secretary and Chief
Financial Officer. The Company will pay aggregate annual salaries of
Cdn$192,000 and paid each employee a one-time bonus of
Cdn$1,000.
|
|
|
|
|
11.
|
Subsequent Events
|
|
|
|
|
|
a)
|
On July 1, 2011, the Company signed prospecting licence
purchase agreements to acquire one prospecting license. The total
consideration includes:
|
|
|
|
|
|
|
i.
|
paying $20,000 within 5 days after execution date. The
payment was made on July 6, 2011;
|
|
|
|
|
|
|
ii.
|
paying a total amount of $470,000 to earn up to 90% of
interest, of which $70,000 due in 2011, $150,000 due in 2012, $125,000 and
$125,000 due in 2013
|
|
|
|
|
|
|
iii.
|
paying $1,500,000 on or before September 21, 2015 to earn
final 10% interest.
|
|
|
|
|
|
b)
|
On July 8, 2011, Otterburn Venture
Inc. terminated all option and Joint Ventures agreements signed on May 20,
2011 (see Note 7).
|
|
|
|
|
|
c)
|
On July 19, 2011, Guardian Investment
Ltd, a related party, on behalf of the Company, entered into a mineral
properties option agreement to acquire four primary mining licenses. Total
consideration includes:
|
|
|
|
|
|
|
iv.
|
paying $20,000 within 7 days after execution date. The
payment was made on July 21, 2011;
|
|
|
|
|
|
|
v.
|
paying a total amount of $470,000, of which $70,000 due
in 2012, $360,000 due in 2013 and $40,000 due in 2014.
|
|
|
|
|
|
|
vi.
|
Royalty may be purchased at any time by paying $250,000
per PML
|
|
|
|
|
|
d)
|
Pursuant to agreements dated July 22, 2011, the Company
has agreed to sell an aggregate of 2,200,000 of common shares of Otterburn
to private purchasers unrelated to the Company at a price of $0.10 per
share for total proceeds of $220,000. These shares will be held in escrow
and released on September 22, 2011. The Company received these shares from
Otterburn pursuant to four option and joint venture agreements dated May
6, 2011 between Otterburn and the Company regarding four Tanzanian
properties, all of which were terminated on July 8,
2011.
|
F-16
4
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Forward Looking Statements
This quarterly report contains forward-looking statements.
Forward-looking statements are projections of events, revenues, income, future
economic performance or managements plans and objectives for our future
operations. 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 and the
risks set out below, any of which may cause our or our industrys 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. These
risks include, by way of example and not in limitation:
-
risks and uncertainties relating to the interpretation of sampling results,
the geology, grade and continuity of mineral deposits;
-
risks and uncertainties that results of initial sampling and mapping will
not be consistent with our expectations;
-
mining and development risks, including risks related to accidents,
equipment breakdowns, labor disputes or other unanticipated difficulties with
or interruptions in production;
-
the potential for delays in exploration activities;
-
risks related to the inherent uncertainty of cost estimates and the
potential for unexpected costs and expenses;
-
risks related to commodity price fluctuations;
-
the uncertainty of profitability based upon our limited history;
-
risks related to failure to obtain adequate financing on a timely basis and
on acceptable terms for our planned exploration project;
-
risks related to environmental regulation and liability;
-
risks that the amounts reserved or allocated for environmental compliance,
reclamation, post-closure control measures, monitoring and on-going
maintenance may not be sufficient to cover such costs;
-
risks related to tax assessments;
-
political and regulatory risks associated with mining development and
exploration; and
-
other risks and uncertainties related to our mineral property and business
strategy.
This list is not an exhaustive list of the factors that may
affect any of our forward-looking statements. These and other factors should be
considered carefully and readers should not place undue reliance on our
forward-looking statements.
Forward looking statements are made based on managements
beliefs, estimates and opinions on the date the statements are made and we
undertake no obligation to update forward-looking statements if these beliefs,
estimates and opinions or other circumstances should change. Although we believe
that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements. 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.
5
In this quarterly report, unless otherwise specified, all
dollar amounts are expressed in United States dollars and all references to
common stock refer to the common shares in our capital stock.
As used in this quarterly report, the terms we, us, our,
the Company and Lake Victoria mean Lake Victoria Mining Company, Inc., and
our wholly owned subsidiaries Kilimanjaro Mining Company, Inc. and Lake Victoria
Resources (T) Limited, Chrysos 197 Company Tanzania Ltd. and Jin 179 Company
Tanzania Ltd., unless otherwise indicated.
Recent Corporate Developments
Since the commencement of our first quarter ended June 30,
3011, we experienced the following significant corporate developments:
|
1.
|
Effective April 1, 2011, the Company changed its head
office address from 1781 Larkspur Drive, Golden, Colorado 80401 to Suite
810 675 West Hastings Street, Vancouver, British Columbia V6B
1N2.
|
|
|
|
|
2.
|
On April 20, 2011, the Company entered into a prospecting
license purchase agreement with Pili Sadiki, to acquire a 100% interest in
a certain prospecting license located in the Kiabakari Musoma District of
Tanzania. Also on April 20, 2011, the Company entered into a prospecting
license purchase agreement with Rashid Omar, to acquire a 100% interest in
a certain prospecting license located in the Handeni Tanga District of
Tanzania.
|
|
|
|
|
3.
|
On April 26, 2011, the Company entered into a consulting
agreement with David Kalenuik, pursuant to which the Company engaged Mr.
Kalenuik to, among other things: provide the services of corporate
management, reporting to the board of directors including without limiting
the generality of the foregoing, hiring other managers and employees as
required, finding new projects and assisting in financing requirements. As
consideration for the performance of his consulting services under the
agreement, the Company agreed to pay Mr. Kalenuik CDN$10,000 per month
commencing April 1, 2011, plus applicable taxes. Contingent upon Mr.
Kalenuik executing the consulting agreement and as part of the
consideration for Mr. Kalenuiks services, the Company agreed to grant Mr.
Kalenuik upon the completion of twelve (12) months of April 26, 2011 and
annually on the anniversary each and every year that follows, during Mr.
Kalenuiks continuous consulting, an option to purchase 500,000 shares of
the Companys restricted common stock, which shall be subject to the terms
and conditions set forth in the Stock Option Agreement. The consulting
agreement is for a term of two years and may be renewed at the option of
the Company by giving 30 days written notice prior to the expiry of the
initial term.
|
|
|
|
|
4.
|
On April 26, 2011, the Company entered into a consulting
agreement with Roger Newell, pursuant to which the Company engaged Mr.
Newell to, among other things: provide the services to the corporate
management, reporting to the president and subsequently to the board of
directors including without limiting the generality of the foregoing,
reviewing and editing technical data/press releases, finding and assessing
new projects and assisting in investor relations, corporate presentations
and financing requirements. As consideration for the performance of his
consulting services under the agreement, the Company agreed to pay Mr.
Newell USD$3,500 per month commencing April 1, 2011, plus applicable
taxes. Contingent upon Mr. Newell executing the consulting agreement and
as part of the consideration for Mr. Newells services, the Company agreed
to grant Mr. Newell upon the completion of twelve (12) months of April 26,
2011 and annually on the anniversary each and every year that follows,
during Mr. Newells continuous consulting, an option to purchase 250,000
shares of the Companys restricted common stock, which shall be subject to
the terms and conditions set forth in this the Stock Option Agreement. The
consulting agreement is for a term of two years and may be renewed at the
option of the Company by giving 30 days written notice prior to the expiry
of the initial term.
|
6
|
5.
|
On April 26, 2011, the Company entered into an employment
letter agreement with Heidi Kalenuik, pursuant to which the Company
employed Ms. Kalenuik to, among other things: carry out the duties and
responsibilities of the position of Secretary, Treasurer and Supervisor of
Operations of the Company. As consideration for the performance of her
duties under the employment letter agreement, the Company agreed to pay
Ms. Kalenuik CDN$102,000 per year commencing April 1, 2011. Ms. Kalenuik
is also entitled to receive a one-time bonus in the amount of
CDN$1,000.
|
|
|
|
|
6.
|
Effective April 26, 2011, the Company entered into an
employment letter agreement with Ming Zhu, pursuant to which the Company
employed Mr. Zhu to, among other things: carry out the duties and
responsibilities of the position of Chief Financial Officer of the
Company. As consideration for the performance of his duties under the
employment letter agreement, the Company agreed to pay Mr. Zhu CDN$90,000
per year commencing April 1, 2011. Mr. Zhu is also entitled to receive a
one-time bonus in the amount of CDN$1,000.
|
|
|
|
|
7.
|
On May 30, 2011, the Board of Directors of the Company
amended and restated the Companys bylaws. The amendment and restatement
of the bylaws was for the purpose of, among other things, removing certain
outdated and redundant provisions that existed in the Companys prior
bylaws with respect to corporate governance, shareholder and director
meeting procedures, and indemnification procedures. The changes to the
Companys prior bylaws include: (i) expanding certain provisions with
respect to shareholders meetings including change of quorum requirements;
(ii) amending certain provisions respecting appointment of directors,
corporate governance and committees, and directors meetings; (iii)
expanding certain provisions with respect to officers and their duties;
(iv) changing certain provisions with respect to share certificates; (v)
eliminate inconsistencies between the bylaws the provisions of the Nevada
Revised Statutes; and (vi) amended indemnification provisions.
|
|
|
|
|
8.
|
On May 30, 2011, the Company entered into a prospecting
license purchase agreement with Manga Mining Corp, to acquire a 100%
interest of one prospecting license located in the Handeni District of
Tanzania.
|
|
|
|
|
9.
|
On June 17, 2011, the Company incorporated two new
wholly-owned subsidiaries, Chrysos 197 Company Tanzania Ltd and Jin 179
Company Tanzania Ltd., in Tanzania to facilitate property acquisitions in
compliance with The Mining (Mineral Rights) Regulations 2010 of
Tanzania.
|
|
|
|
|
10.
|
On July 1, 2011, the Company entered into a prospecting
license purchase agreement with I. M. Kwematuku Export Trade Ltd, to
acquire up to 100% interest of one prospecting licenses located in the
Handeni District of Tanzania.
|
|
|
|
|
11.
|
On May 10, 2011, the Company entered into four joint
venture and option agreements (the Options) with Otterburn Ventures Inc.
(Otterburn) pursuant to which Otterburn had the right to acquire up to
an undivided 70% interest (the Options) in and to certain Primary
Mineral Licenses (PMLs) and Prospecting Licenses (PLs). On May 20,
2011 Otterburn paid the initial cash payment of US$497,423 and completed
the issuance of 2,200,000 common shares to Lake Victoria.
|
|
|
|
|
|
On July 8, 2011, Otterburn Ventures Inc. (Otterburn)
exercised its rights to terminate four option and joint venture
agreements. In connection with the termination of the option agreements:
(i) Otterburn agreed to pay such applicable Tanzanian government fees to
leave the respective licenses in good standing for a period six months
from July 8, 2011; and (ii) Otterburn, Lake Victoria Resources (T) Ltd.,
our wholly-owned subsidiary, and agreed to pay a reimbursement for the
work expenditures incurred by Otterburn during the months of March through
the termination date of July 8, 2011 and, if required, certain termination
costs, provided such termination costs have been incurred in accordance
with the exploration service agreement.
|
|
|
|
|
|
Pursuant to share purchase agreements dated July 22,
2011, the Company agreed to sell an aggregate of 2,200,000 of common
shares of Otterburn Ventures Inc. to private purchasers unrelated to the
Company at a price of $0.10 per share on September 22,
2011.
|
7
|
12.
|
On July 19, 2011, Guardian Investment Ltd, a related
party, on behalf of the Company, entered into a mineral properties option
agreement to acquire four primary mining licenses on Uyowa project. Total
consideration includes:
|
|
(a)
|
paying $20,000 within 7 days after execution date. The
payment was made on July 21, 2011;
|
|
|
|
|
(b)
|
paying a total amount of $470,000, of which $70,000 due
in 2012, $360,000 due in 2013 and $40,000 due in 2014; and
|
|
|
|
|
(c)
|
Royalty may be purchased at any time by paying $250,000
per Primary Mining License.
|
Our Current Business
We are an exploration stage corporation focused on acquiring,
exploring and developing gold deposits in the Lake Victoria Greenstone Belt in
Tanzania, East Africa. We hold prospective gold projects, consisting of 34
Prospecting Licenses (PLs) and 88 Primary Mining Licenses (PMLs) and five
uranium projects consisting of 9 Prospecting and Reconnaissance Licenses plus
two licenses currently under application, within its Tanzania property
portfolio, covering approximately 3,243 square kilometers (801,260 acres). We
carry out our business by acquiring, exploring and evaluating mineral properties
through our ongoing exploration program. Following exploration, we intend to
either advance them to a commercially feasible mining stage, enter joint
ventures to further develop these properties or dispose of them if the
properties do not meet our requirements. Our properties are all early stage
exploration properties. Within our mineral exploration land in Tanzania our
focus is primarily on gold, although our portfolio also contains uranium
prospects.
We have no revenues, we have incurred losses since inception
and we have relied upon the sale of our securities to fund operations. To date,
we have not discovered a commercially viable ore body, mineral deposit or
mineral reserve on any of our properties and we will be unable to do so until
further exploration is done and a comprehensive evaluation concludes an economic
and legal feasibility study.
Our property portfolio is large, therefore we may interest
other companies in our properties to either participate by means of option or
joint venture agreements in the exploration of them or to finance and establish
production if mineralization is found.
Prospective Gold Projects
The following is a brief overview of our portfolio of
prospective mineral properties, the exploration developments on them where
applicable and some of the details of the historical option agreements for them.
During the three months ended June 30, 2011, our exploration work was primarily
concentrated on the Singida, Musoma Bunda Murangi, Uyowa, North Mara and Handeni
gold projects.
Musoma Bunda Murangi Gold Project
The Musoma Bunda Murangi Gold Project is comprised of three (3)
Prospecting Licenses (PLs) that are located on the eastern side of Lake
Victoria. All three licenses lie within the Musoma-Mara Greenstone belt and
cover a combined area of 155.74 square kilometers in the northeast of the United
Republic of Tanzania, East Africa, close to the southeast shore of Lake
Victoria.
Musoma, located 30 kilometers north of the Suguti license, is
the main commercial centre of Mara Region. The town of Bunda, located on the
main Mwanza - Musoma paved highway, is 18 kilometers to the east of the
Kinyambwiga license.
Exploration Strategy
During this reporting period, exploration work has largely been
focused on the Kinyambwiga and Suguti licenses.
8
Kinyambwiga PL4653/2007
Exploration has been focused around Kanunga 1 Prospect. A
number of Schlumberger N-S profiles have been undertaken to the east and west of
Kanunga 1 in an attempt to trace the strike of the mineralized ENE-WSW quartz
vein. Results of the survey have identified at least 2 distinct chargeability
anomalies that appear consistent with the strike of the known structure (Map 1).
However, subdued to poor resistivity anomalies are noted across each of the
profiles.
Table 1: Summary of Schlumberger VES profiles planned across
Kanunga 1 Prospect
|
|
|
From
|
To
|
|
Target
|
Section
|
Easting
|
Northing
|
Northing
|
Length
|
Kanunga East
|
581940E
|
582900
|
9776900
|
9777200
|
300
|
Kanunga East
|
582100E
|
582900
|
9776900
|
9777300
|
400
|
Kanunga East
|
582420E
|
582420
|
9776950
|
9777350
|
400
|
Kanunga East
|
582900E
|
582900
|
9777000
|
9777400
|
400
|
Kanunga East
|
583220E
|
583220
|
9776650
|
9777050
|
400
|
Kanunga East
|
583400E
|
583400
|
9777260
|
9777660
|
400
|
Kanunga West
|
580660E
|
580660
|
9776500
|
9776900
|
400
|
Kanunga West
|
580500E
|
580500
|
9776450
|
9776850
|
400
|
Kanunga West
|
580340E
|
580340
|
9776400
|
9776800
|
400
|
Kanunga West
|
580180E
|
580180
|
9776350
|
9776750
|
400
|
Kanunga West
|
579540E
|
579540
|
9776150
|
9776550
|
400
|
Kanunga West
|
579220E
|
579220
|
9775930
|
9776330
|
400
|
Kanunga West
|
579220E
|
579220
|
9776600
|
9777000
|
400
|
Kanunga West
|
578900E
|
578900
|
9776600
|
9777000
|
400
|
9
Map 1: Plan showing the location of the Schlumberger IP
profiles across the interpolated mineralized structure of Kanunga 1.
Follow-up investigation into a number of soil anomalies ranging
from 80 ppb to 1,260 ppb gold that occur in the eastern part of the license,
east of Kanunga 1 was undertaken. These anomalies were found to lie within the
boundary of Kanunga School. Each of the sample positions was re-sampled to check
the authenticity of the results. Additional infill samples on 25 meter centers
were collected between the existing sample positions. An infill soil sampling
program on a 100 meter x 25 meter grid was completed across the anomaly.
Similarly, follow-up investigations of the soil anomalies to
the west of Kanunga 1 were also completed at Target 3. These soil anomalies lie
approximately 300 meters east from a circular magnetic structure, interpolated
to represent an intrusive body. No outcrop is present but the topography is
noted to be slightly raised above the surrounding plains.
A soil sampling program is in progress across the IP anomalies
as defined by the Schlumberger VES profiles west of Kanunga 1. All samples are
planned to be sieved and submitted to SGS laboratory for gold analysis by Aqua
Regia.
10
Table 2: Trench Results
Trench No
|
Target
|
Phase 1
|
|
|
Phase 2
|
Interval
|
Sample
|
Mbuga Depth
|
Reference
|
Intersections
|
KANUNGA 1 EAST
|
|
From
|
|
To
|
(m)
|
|
Expected
|
Actual
|
|
|
|
|
Orientation pit
|
|
Trench
|
|
|
(m)
|
(m)
|
|
|
|
|
Easting
|
Northings
|
|
Northings
|
|
|
|
|
|
|
KNT52
|
1
|
581980
|
9776994
|
|
9777000
|
6
|
3
|
5
|
|
KNRAB-051
|
6m@0.36g/t Au
|
KNT53
|
1
|
582047
|
9776996
|
|
9777010
|
14
|
7
|
2
|
|
KNRAB-052
|
1m@1.76g/t Au
|
|
|
|
|
|
|
0
|
0
|
|
|
|
6m@0.23g/t Au
|
|
|
|
|
|
|
0
|
0
|
|
|
|
1m@0.45g/t Au
|
KNT54
|
1
|
582094
|
9776998
|
|
9777006
|
8
|
4
|
5
|
|
KNRAB-053
|
3m@1.44g/t Au
|
KNT55
|
2
|
583136
|
9777036
|
|
9777046
|
10
|
5
|
4
|
|
KNRAB-067
|
2m@3.48g/t Au
|
KNT56
|
2
|
583240
|
9777006
|
|
9777014
|
8
|
4
|
4
|
|
KNRAB-069
|
3m@0.64g/t Au
|
KNT57
|
2
|
583344
|
9776996
|
|
9777002
|
6
|
3
|
3
|
|
KNRAB-071
|
6m@0.84g/t Au
|
KNT58
|
2
|
583388
|
9776994
|
|
9777006
|
12
|
6
|
5
|
|
KNRAB-072
|
11m@1.32g/t Au
|
KNT59
|
2
|
583294
|
9777200
|
|
9777210
|
10
|
5
|
3
|
|
KNRAB-075
|
3m@1.80g/t Au
|
KNT60
|
2
|
582546
|
9776596
|
|
9776606
|
10
|
5
|
4
|
|
KNRAB-020
|
2m@0.71g/t Au
|
KNT61
|
2
|
581784
|
9776594
|
|
9776604
|
10
|
5
|
1
|
|
KNRAB-005
|
27m@0.27g/t Au
|
|
|
|
|
94
|
|
|
|
|
|
Total samples (50gm Fire Assay)
|
|
|
|
|
47
|
|
|
|
|
Infill Soil
samples
|
|
|
|
|
|
|
|
|
|
|
|
Kanunga 1 E
|
1
|
582050
|
9777020
|
|
9777150
|
130
|
14
|
|
|
Soil
|
10 m spacing
|
Kanunga 1 E
|
1
|
582050
|
9776936
|
|
9776996
|
60
|
7
|
|
|
Soil
|
10 m spacing
|
Kanunga 1 E
|
2
|
582900
|
9776800
|
|
9777000
|
200
|
9
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 E
|
2
|
582800
|
9776800
|
|
9777000
|
200
|
9
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 E
|
2
|
583100
|
9776875
|
|
9777100
|
225
|
10
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 E
|
2
|
583200
|
9777025
|
|
9777175
|
150
|
7
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 E
|
2
|
583300
|
9776950
|
|
9777225
|
275
|
12
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 E
|
2
|
583400
|
9776975
|
|
9777275
|
300
|
13
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 W
|
3
|
579200
|
9776750
|
|
9776975
|
225
|
10
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 W
|
3
|
579100
|
9776750
|
|
9776975
|
225
|
10
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 W
|
3
|
579300
|
9776800
|
|
9777000
|
200
|
9
|
|
|
Soil
|
25 m spacing
|
Kanunga 1 W
|
3
|
583220
|
9776720
|
|
9776740
|
20
|
3
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
583220
|
9776810
|
|
9776840
|
30
|
4
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
585740
|
9777960
|
|
9778000
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
585740
|
9778060
|
|
9778100
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
579540
|
9776610
|
|
9776640
|
30
|
4
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
579540
|
9776740
|
|
9776780
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
579540
|
9776840
|
|
9776880
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
582100
|
9777030
|
|
9777120
|
90
|
10
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
581940
|
9777130
|
|
9777170
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580820
|
9776940
|
|
9776980
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580500
|
9776540
|
|
9776580
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580500
|
9776660
|
|
9776700
|
40
|
5
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580340
|
9776460
|
|
9776520
|
60
|
7
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580340
|
9776560
|
|
9776570
|
10
|
2
|
|
|
IP
|
10m spacing
|
Kanunga 1 W
|
3
|
580340
|
9776620
|
|
9776660
|
40
|
5
|
|
|
IP
|
10m spacing
|
Total Soil samples (50gm Aqua Regia)
|
|
|
|
|
185
|
|
|
|
|
* Phase 2. Trench will only be dug and sampled in bedrock
saprolite beneath mbuga.
If Mbuga is >3m deep - no Trench/pit
11
Sample on 2m composite channels and sample any quartz veins
separately - 50 gm Fire assay
A Pitting and trenching program is currently underway east of
Kanunga 1.
Map 2: Kanunga 1 East showing anomalous soil and RAB
intersections
Orientation pits have first been dug to establish the depth of
the mbuga cover over the position of the mineralized intersection. In all
cases the mbuga cover is less than 3 meters thick allowing a number of short
N-S trenches to be excavated across the anomaly.
Trenching has encountered granite and, in one section, a
non-magnetic diabase dyke. Channel samples collected on 2 meter composites are
planned to be submitted to SGS Laboratory for 50gm gold fire assays.
Once the Rotary Air Blast (RAB) drill hole anomalies have been
confirmed, a number of longer trenches will be planned to map out the extent of
the mineralized zones.
Suguti (PL3966/2006)
Exploration work has commenced on the Suguti PL. Gradient IP
surveys have been partly completed across the PL. Mapping and soil sampling
programs have been completed over non-mbuga covered in the northern and
southern parts of the Suguti License. Soil sampling has been conducted on a 400
meter x 50 meter grid in which a total of 544 samples, including 26 blank
samples, have been collected and analyzed by SGS Laboratory, Mwanza using Aqua
Regia (Table 5).
A total of 544 samples have been collected from the Suguti
project of which includes 26 blank samples.
12
Table 3: Statistical summary of soil sample results
collected at Suguti PL
Range (ppb Au)
|
Samples
|
Blanks
|
Outstanding assays
|
<10
|
354
|
21
|
|
10-20
|
83
|
4
|
20-30
|
53
|
1
|
30-40
|
5
|
|
40-50
|
2
|
|
>50
|
1
|
|
Total
|
498
|
26
|
20
|
Over 71% of the soil results returned <10ppb gold with the
remainder falling between 10 to 50ppb gold. A single, maximum soil value of
160ppb Au was reported and has yet to be verified in the field.
Regolith mapping has been completed across the entire Suguti
license. The license is transected by the major NW-SE trending Suguti Fault
which has formed a topographic depression that has subsequently been infilled by
a thick deposit of mbuga that covers an area of some 25 square kilometers and
constitutes 34% of the license. The area becomes totally waterlogged during the
wet season and is used for growing rice. Exposure is limited to minor rock out
crops on the northern side of the Suguti Fault. Granite, containing magnetite,
occurs as a hill in the northern part of the license. The granite/greenstone
contact is masked by coarse textured laterite consisting of laterised basaltic
and quartz fragments. The underlying greenstone rocks have been intensely
sheared and iron stained along to the NW-SE trending granite contact. Brick-red
soils make up the NE part of the license before being masked by the overlying
mbuga further south. A number of low order threshold soil anomalies, attaining
a maximum of 50 ppb gold, appear to form at least three NE trending parallel
zones of up to 2.5 kilometers strike length (Target 1). A coincident IP anomaly
underlies the soil anomaly (Map 3).
13
Map 3: Residual Gradient IP map of the Suguti North Prospect
showing soil anomalies and proposed Schlumberger VES surveys across Targets 1
and 2.
A reconnaissance examination has been made on the north-western
side of the license at Target 2. A single artisanal pit is present on a NW-SE
trending narrow quartz vein within felsite rocks. A number of low order
threshold soil anomalies occur in the vicinity and these anomalies may reflected
an intersection of two NE and NW trending lineaments.
Banded Iron Formations in the southern part of the property,
form topographic highs about 300 meters above the plains, have yet to be
examined. However, no coherent anomalies other than a single point value of 160
ppb gold and a single line anomaly of 20 ppb gold was obtained from the soil
sampling program. Field investigation is required before any follow-up
exploration is proposed.
The following exploration work is planned for the forthcoming
quarter:
i. Infill Soil Sampling
Infill soil
sampling on 25 meter centers along the existing soil sample traverses has
recently been completed in order to better define the soil anomalies both at
Target 1 and 2 (Table 4). A total of 112 samples are currently being prepared
for submission to SGS Laboratory Mwanza for Aqua Regia analysis of gold. All
intermediate sized termite mounds across Target 1 have been sampled and remain
to be panned. Additional three soil sample traverse lines have been completed
across the IP anomaly in the NW of Target 2. However, orientation pits, dug to
determine the depth of the mbuga, encountered underlying granite a meter below
surface. No soil or rock samples were collected over the granite.
14
Table 4: Soil sample program over Targets 1 and 2, Suguti
North Prospect
|
|
|
|
|
|
|
Mbuga Depth
|
|
|
SUGUTI N
|
Target
|
Section
|
From
|
To
|
Interval(m)
|
Sample
|
Expected
|
Actual
|
Reference
|
Comments
|
Suguti NE
|
1
|
583400
|
9802850
|
9802350
|
500
|
10
|
-
|
|
Soil*
|
25m spacing
|
|
1
|
583000
|
9802650
|
9802000
|
650
|
13
|
-
|
|
Soil*
|
25m spacing
|
|
1
|
582600
|
9802350
|
9801800
|
550
|
11
|
-
|
|
Soil*
|
25m spacing
|
|
1
|
582200
|
9802150
|
9801200
|
950
|
19
|
-
|
|
Soil*
|
25m spacing
|
|
1
|
581800
|
9801900
|
9801050
|
850
|
17
|
-
|
|
Soil*
|
25m spacing
|
|
1
|
581400
|
9801650
|
9800900
|
750
|
15
|
-
|
|
Soil*
|
25m spacing
|
Suguti NW
|
2
|
579000
|
9802000
|
9801500
|
500
|
10
|
-
|
|
Soil*
|
25m spacing
|
|
2
|
578600
|
9801950
|
9801750
|
200
|
4
|
-
|
|
Soil*
|
25m spacing
|
|
2
|
578000
|
9802500
|
9802150
|
350
|
14
|
2
|
|
Soil
|
25m spacing
|
|
2
|
577600
|
9802650
|
9802300
|
350
|
14
|
2
|
|
Soil
|
25m spacing
|
|
2
|
577200
|
9802650
|
9802350
|
300
|
12
|
2
|
|
Soil
|
25m spacing
|
Total
|
|
|
|
|
|
139
|
|
|
|
|
Soil* refer to infill samples on 25m spacing between previous
sample positions
ii. Termite samples
Termite sampling has been undertaken
across the brown-red soils over Target 1. A total of 89 samples have been
collected and are currently being prepared for submission to SGS Laboratory,
Mwanza for 500 gm BLEG analysis for gold.
iii. Schlumberger VES Survey
Schlumberger VES survey,
consisting of two N-S profiles comprising of 3 x 400 meter lengths has recently
commenced at Target 1. An additional 3 short lines of 400 meters in length are
planned across the IP anomaly at Target 2.
Table 5: Schlumberger VES survey proposed across Targets 1
and 2, Suguti North prospect
|
|
|
From
|
To
|
|
Target
|
Section
|
Easting
|
Northing
|
Northing
|
Length
|
1
|
582600E
|
582600
|
9802500
|
9802100
|
400
|
1
|
|
582600
|
9802100
|
9801700
|
400
|
1
|
|
582600
|
9801700
|
9801300
|
400
|
1
|
581400E
|
581400
|
9801900
|
9801500
|
400
|
1
|
|
581400
|
9801500
|
9801100
|
400
|
1
|
|
581400
|
9801100
|
9800700
|
400
|
2
|
579000E
|
579000
|
9802100
|
9801700
|
400
|
2
|
578100E
|
578100
|
9802500
|
9802100
|
400
|
2
|
577500E
|
577500
|
9802700
|
9802300
|
400
|
15
Murangi(PL4511/2007)
No exploration was undertaken on the Murangi Permit during the
month. Furthermore, there is no record of previous exploration undertaken on
this license.
However, exploration is planned in the forthcoming month and it
is to be focused primarily on 5 ground magnetic targets and is also planned to
include:
|
1.
|
Mapping of the target areas on 1:2000 scale
|
|
|
|
|
2.
|
Gradient IP survey across the entire license
|
|
|
|
|
3.
|
Orientation pits within each of the Targets to test the
depth of the mbuga cover for future soil sampling program either through
pitting or Augering.
|
Singida Gold Project
Company personnel first visited the Singida project area during
March, 2009 and became aware of the high level of artisanal (small scale) gold
mining that was being conducted along an estimated five (5) kilometer
mineralized zone. Subsequently, on May 15, 2009, the Company signed a Mineral
Financing Agreement with one director of the Company authorizing him, on behalf
of the Company, to acquire Primary Mining Licenses (PMLs) in the Singida area.
As of July 13, 2011, this director has entered into several different Mineral
Properties Sales and Purchase agreements with multiple PML owners that hold
title to the licenses along the mineralized zone at the Singida project area.
Twenty-three (23) PML agreements were executed for an outright purchase of the
PMLs and they have been completed. These twenty-three PMLs have been 100%
acquired by this director in behalf of the Company. The Company also has option
agreements to acquire an additional thirty-seven (37) PMLs within a targeted
area at the Singida project. Under the terms of all the agreements, if we
complete all sixty (60) of the various agreements, that when combined form the
Singida project area, then our total purchase consideration will be
approximately $6,432,930 (TZS9,896,816,657) by February, 2013.
The Company commenced Phase 2 Reverse Circulation drilling
program in March 2011, centered at the Sambaru 2,3,4 and 5 Prospects as well as
exploring a number of exploration targets within the Singida-Londoni northwest
trending shear zone at Sambaru 5 and between Sambaru 3 and Sambaru 4 (Table 6).
Drilling has recently been completed in which 92 boreholes, totaling 9,023
meters have been drilled. All boreholes, collared along northeast trending drill
fences, are inclined at -50 degrees to -65 degrees either to the northeast or to
the southwest. Total meters drilled in both drill programs amounts to 15536
meters (Table 6).
Table 6: Summary of Reverse Circulation drilling undertaken
at the Singida-Londoni Gold project
Prospect
|
Phase 1
|
Phase 2
|
Total
|
Sambaru 1
|
264
|
-
|
264
|
Sambaru 2
|
2348
|
2963
|
5311
|
Sambaru 3
|
1078
|
2931
|
4009
|
Sambaru 4
|
2163
|
2328
|
4491
|
Sambaru 5
|
564
|
897
|
1461
|
Total
|
6417
|
9119
|
15536
|
The two exploration targets were investigated by drilling. The
2
nd
zone of mineralisation located some 180 meters south of the main
mineralised zone at Sambaru 5 was intersected and was found to be narrow and of
low grade running 1.04 g/t gold over 1 meter. Similarly, the +100 ppb gold soil
anomaly located mid-way between Sambaru 3 and 4 returned anomalous results with
only one narrow intersection of 1.57 g/t gold over 1 meter being encountered. No
follow-up drilling was undertaken on either of the two targets.
Results of the drilling program are summarised in Table 7.
16
Table 7:
Summary of Reverse Circulation Drill
Results from Sambaru 2, 3, 4 and 5
Hole No.
|
Total
Depth
(m)
|
Section
|
Azimu
th
(deg)
|
Declin (deg)
|
From (m)
|
To
(m)
|
Interval
(m)
|
Grade (Au
g/t)
|
Sambaru
5
|
SGRC0080
|
40
|
4680W
|
40
|
-50
|
32
|
35
|
3
|
5.05
|
SGRC0084
|
40
|
4600W
|
40
|
-50
|
29
|
35
|
6
|
1.13
|
SGRC0085
|
60
|
4560W
|
40
|
-50
|
11
|
15
|
4
|
1.87
|
Sambaru
4
|
SGRC0097
|
70
|
3840W
|
40
|
-50
|
50
|
54
|
4
|
7.35
|
|
(including 1m @20.30 g/t Au)
|
SGRC0100
|
75
|
3920W
|
220
|
-50
|
59
|
64
|
5
|
2.35
|
SGRC0103
|
75
|
3880W
|
220
|
-55
|
79
|
82
|
3
|
6.22
|
|
(including 1m @12.10 g/t Au)
|
SGRC0107
|
90
|
3960W
|
220
|
-55
|
37
|
40
|
3
|
1.30
|
SGRC0108
|
125
|
3960W
|
220
|
-60
|
69
|
72
|
3
|
2.46
|
SGRC0115
|
55
|
3720W
|
220
|
-50
|
1
|
5
|
4
|
1.11
|
Sambaru
3
|
SGRC0122
|
120
|
2540W
|
220
|
-50
|
43
|
47
|
4
|
1.14
|
|
|
|
|
And
|
144
|
149
|
5
|
2.96
|
|
(including 1m @11.00 g/t Au)
|
SGRC0125
|
90
|
2500W
|
40
|
-58
|
14
|
60
|
46
|
2.64
|
|
(including 3m @9.75 g/t Au)
|
|
|
|
|
And
|
71
|
74
|
3
|
4.32
|
SGRC0128
|
90
|
2460W
|
220
|
-65
|
18
|
19
|
1
|
34.10
|
SGRC0130
|
136
|
2500W
|
220
|
-55
|
112
|
115
|
3
|
3.32
|
SGRC0135
|
120
|
2620W
|
220
|
-50
|
25
|
30
|
5
|
1.17
|
|
|
|
|
And
|
86
|
91
|
5
|
4.27
|
Sambaru
2
|
SGRC0137
|
50
|
1980W
|
40
|
-50
|
0
|
6
|
6
|
1.04
|
SGRC0140
|
115
|
1980W
|
40
|
-55
|
111
|
115
|
4
|
3.63
|
|
|
|
|
And
|
134
|
145
|
11
|
3.21
|
|
(including 1m @11.90 g/t Au)
|
SGRC0145
|
140
|
2660W
|
220
|
-60
|
117
|
120
|
3
|
3.02
|
SGRC0149
|
72
|
1900W
|
40
|
-50
|
45
|
50
|
5
|
1.31
|
SGRC0152
|
93
|
2100W
|
40
|
-55
|
61
|
65
|
4
|
2.01
|
SGRC0157
|
110
|
2180W
|
40
|
-65
|
28
|
30
|
2
|
3.16
|
|
|
|
|
And
|
67
|
80
|
13
|
1.99
|
|
(including 2 m@ 6.11g/t Au)
|
SGRC0160
|
128
|
2420W
|
220
|
-55
|
82
|
88
|
6
|
1.94
|
SGRC0163
|
150
|
2620W
|
220
|
-60
|
75
|
93
|
18
|
1.05
|
SGRC0166
|
125
|
2700W
|
220
|
-50
|
73
|
87
|
14
|
2.15
|
|
(including 1m@10.70g/t Au)
|
SGRC0169
|
150
|
2060W
|
40
|
-60
|
63
|
65
|
2
|
42.71
|
|
(including 1m@84.40g/t Au)
|
SGRC0170
|
120
|
1860W
|
0
|
-90
|
75
|
83
|
8
|
3.45
|
17
Sambaru 5
Drilling has intercepted the narrow and
steeply-dipping, arsenopyrite-rich gold zone across a strike length of some 160
meters. Besides the high grade intersection of
16.80 g/t gold over 2
meters
reported from Section 4640W during the Phase 1 drilling program, most
of the intercepts returned low gold values of between 0.5 to 1 g/t gold over 1
or 2 meter intervals with grade appearing to decrease with depth.
Sambaru 4
The main body of mineralization, having
a grade of 3.45 g/t gold over a true thickness of 11 meters and centered over an
area of extensive artisanal mining, was traced to a depth of 80 meters before
pinching out. The zone, narrowing rapidly out along strike and decreasing in
grade, has been traced for 320 meters. Drilling indicated a decrease in grade
and width of the mineral zone at depth.
A subsidiary, narrow mineralized lens,
located 50 meters to the north-east of the main lens was traced along a strike
for 80 meters. Anomalous grades defined the zone further to the northwest.
Sambaru 3
Sambaru 3 is the 2
nd
largest
of all 5 artisanal sites, comprising of at least 4 parallel but narrow
mineralized zones that have been traced continually across a strike length of
280 meters. The main pod of mineralization, averaging 1.93 g/t gold and having a
maximum width of 25 meters, pinches out at 110 meters in depth. It has a surface
strike extend of approximately 40 meters.
The mineral lenses dip sub-vertically
to the northeast. Drilling has indicated that a number of lenses appear to
extend beyond 110 meters depth and are open along strike both to the northwest
and southeast.
Sambaru 2
Sambaru 2 is the largest of the 5
prospects within the Singida-Londoni Project. Although artisanal workings extend
along a strike length of 580 meters, drilling has defined gold mineralization to
occur within a length of about 320 meters of strike length. Four, parallel and
vertically to sub-vertically dipping gold lenses, were intersected to depths of
130 meters although in places the lenses do appear either to pinch out or
decrease in grade.
The lenses tend to occur as narrow
semi-discontinuous veins pinching and swelling along the horizontal and
vertical distances, grades typically vary between 3.5g/t to less than 0.5g/t
gold.
An evaluation of the drill results for both Phase 1 and 2
programs has shown that gold mineralization at the Singida-Londoni project
consists of narrow medium to low grade and often discontinuous lenses. The shear
structures hosting the gold-rich zones typically pinch and swell along strike,
which in places, has resulted in larger pods of limited size as at Sambaru 3 and
Sambaru 4.
18
The Company has recently completed a Technical report in
compliance with Canadian National Instrument 43-101 and this report includes
work completed on the Singida-Londoni Gold Project the Phase 1 drilling program.
It does not include results for the Phase 2 drilling program.
Buhemba Gold Project
The Buhemba Gold Project consists of two (2) Prospecting
Licenses (PLs) that cover an area about 107km
2
.
Exploration Strategy
A field investigation of the work undertaken by Rand gold has
already been completed which has confirmed the presence of at least 4 areas of
artisanal workings. Follow-up exploration is planned to target the known areas
of artisanal mining as well as to investigate the western sheared basalt/granite
contact in PL 4892/2007. Although the PMLs of the artisanal workings do not form
part of the PL license, we believe that the owners would be amenable to entering
an option agreement. Pole-Dipole traverses are planned across the sheared
contact in order to prioritize a follow-up reverse circulation (RC) drilling
program that is expected in this year.
No work has been conducted on either of the two licenses
PL2979/2005 and PL5159/2009 southeast of Buhemba town. Soil sampling on 200
meter x 50 meter centers is planned on the license outside the mbuga-covered
areas, results from as gradient IP survey and a mapping program will dictate the
next phase of exploration.
Uyowa Gold Project
The Uyowa Gold project consists of seven (7) Prospecting
Licenses (PLs) that cover a total area of 900 square kilometers in the west
central area of Tanzania. Exploration has largely been focused in the northern
part of the license block.
Exploration Strategy
Exploration work on the Uyowa Project commenced on PL 3425/2007
in January 2011 and continued until the onset of the rainy season in early May.
All work was stopped for the duration of the rainy season up to mid-July. Field
work re-commenced in the last week of July. Prior to the rainy season, the
following exploration activities were undertaken:
-
The raw aeromagnetic data, flown by Geosurvey International G.m.b.H between
1977 to 1980 on a line spacing of 1.0 kilometer and at a height of 120 meters,
has been purchased from the Geological Survey, Dodoma and has been
subsequently re-processed and interpreted. A number of priority areas were
highlighted (Targets 1 to 5). Due to accessibility, exploration has been
focused on Target 3 which lies across the central and eastern side of the
License Block and includes PL 5916/2009.
-
Detailed ground magnetometer survey has commenced across Target 3 on 200
meter spaced N-S traverse lines. To date, at total of 35 traverses, of 7.5
kilometer each, totaling 265 line-kilometers have been completed along the
eastern part of Target 3.
-
Soil sampling on 400 meter x 50 meter centers is currently underway. A
total of 1057 samples of 1 kilogram each, including 52 Blanks, have been
collected, prepared on site to 80 mesh and submitted to SGS Laboratory Mwanza
for gold determination by Aqua Regia.
Results indicate that 77% of all samples returned below
background values (<10 ppb Au) Table 8. All of the anomalous values
(>50ppb Au) tend to be isolated single point values. The maximum soil value
reported is 1.24g/t Au.
19
Table 8: Statistical summary of soil sample results
collected on Target 3, Uyowa Gold Project
Range (ppb Au)
|
Samples
|
Blanks
|
Outstanding assays
|
<10
|
782
|
36
|
|
10-20
|
129
|
9
|
20-30
|
58
|
6
|
30-40
|
18
|
|
40-50
|
14
|
|
>50
|
8
|
1
|
Total
|
1009
|
52
|
96
|
-
A total of 12 rock samples were collected and submitted for 50gm Fire
Assay. All samples returned <0.02g/t gold.
-
Termitaria sampling was undertaken but samples have yet to be panned.
-
Regolith mapping has been undertaken in conjunction with the soil sampling
program across Target 3.
-
Remote sensing studies have been undertaken using various Band ratios with
Landsat Imagery. ASTER imaging has been obtained for the area and has been
processed using the various mineral Index ratios. Follow-up ground truthing is
planned once exploration resumes during the dry season.
Follow-up exploration on the Uyowa Block of licenses as from
the end of July is to be focused on the northern most license (PL 5153/2008)
which is host to an active artisanal mining site covering an area of 300 meters
x 100 meters. The area of workings and the surrounding environs have been
covered by 15 PMLs that do not form part of the PL.
However, an option to purchase agreement has been entered into
with the owners of the 4 PMLs that lie across the main zone of workings.
Exploration is to be prioritized on the optioned PMLs and the
area immediately along strike of the known gold lenses in order to make an
informed decision on whether or not to proceed with securing the PMLs across the
zone of known gold mineralization. This is planned to involve:
-
Regional Mag survey on 200 meter spaced N-S lines covering a 12 kilometer x
6 kilometer grid
-
Gradient array survey on 400 meter spaced N-S lines across the optioned PML
and extending out along strike across a grid of 10 kilometers x 4 kilometers
-
Soil sampling on a 200 meter x 50 meter grid across a grid area of 2.25
kilometers x 10 kilometers (excluding the artisanal site)
-
Schlumberger profiles
-
Detailed mapping
-
a 1500 meter RC drill program to test the down-dip continuity of thickness
and grade as well as exploring the strike extensions of the 4 main mineralized
zones across the PMLs.
Additional exploration is planned to encompass the PL 3425/2007
located immediately south of PL5153/2008 and include:
20
-
Ground checking of Landsat and ASTER imaging by following up on a number of
iron alteration zones
-
Field investigation and follow up sampling/pitting/trenching on any of the
delineated soil anomalies as delineated from the earlier soil sampling program
completed before the rainy season.
-
Selected Gradient IP surveys and Schlumberger VES profiling across
delineated targets.
-
RAB/RC drilling over prioritized targets.
21
Handeni Gold Project
The Handeni Project, comprising of three (3) Prospecting
Licenses and covering a total area of 200.59 square kilometers (Table 15), is
located approximately 240 kilometres by road north- west of Dar es Salaam and
some 30 kilometers south of Handeni town within the Handeni District (Map 8).
The Company has acquired 100% of PL7148/2011 as well as entering into an option
to purchase agreement for 100% of PL7002/2001 and PL4816/2807 (Table 15).
Map 8. Location map of the Handeni Project
Table 15. Details of Handeni Region Prospecting Licenses
License ID
|
Area
|
Area (km2)
|
7002/2011
|
Amani
|
172.36
|
7148/2011
|
Mkulima East
|
12.00
|
4816/2007
|
Mkulima
|
16.23
|
Total
|
200.59
|
22
Gold was discovered in the area in 2003 and was centered at
Magambazi village. However, the area has recently come under the spotlight as a
potentially new gold district. High grade gold intersections are being reported
by Canaco Resources from their drilling programs that are being conducted on
their 197 square kilometer Kilindi PL located immediately west of our PLs.
The area, situated outside the known boundary of the Tanzanian
Craton, has long been overlooked as a major exploration target due to primarily
the nature of the high grade metamorphic rocks not being considered suitable to
host major gold deposits. Increased attention is now being paid to this area
that is situated between the known Tanzanian Craton and the Proterozoic
Mozambique Mobile Belt.
The geology of the region is represented by high grade
metamorphic rocks within the amphibolite to granulite facies comprising of
feldspar-quartz biotite and garnet-hornblende-biotite gneisses and pegmatites
aligned along a regional northwest-southeast trend. The host lithologies for
gold mineralisation as reported by Canaco Resources are comprised of
garnet-silica altered amphibolite together with minor
biotite-kyanite-quartz-feldspar gneisses. Folding, with fold axes aligned along
the regional structure are evident at Magambazi, where they form, in conjunction
with the favourable mafic lithologies, the primary controls to the gold
mineralisation.
Exploration Strategy
Prior to commencing fieldwork, the following desktop studies
were undertaken:
With our objective to evaluate the licenses that are under
option as swiftly as possible, stream sediment sampling is currently being
conducted over all of the licenses.
The dominant drainage patterns are from the north-west to the
south-east and are generally defined along major lithological contacts
particularly between units of amphibolite and quartz-feldspar gneiss. The
Mligazi River, transecting the SW corner of Mkulima PL4816/2007 and the Kwale
River draining the Amani PL7002/2011 are the main river systems that drain both
license areas. Secondary tributaries are developed along the NE-SW cross-cutting
structures. Regional stream sediment sampling has been planned on
1
st
, 2
nd
, 3
rd
and 4
th
order
tributaries from the 1:50,000 scale topography maps (Map 9). To date a total of
120 samples have been collected from the Mkulima PL, in which a 1 kilogram
sample was panned on site and a 500gm sample has been submitted to SGS
Laboratory to test for bottleleachable-extractable gold (BLEG). Approximately
210 stream sediment samples are planned to be collected from Amani PL7002/2011.
Map 9. Stream Sediment Sampling Program for Handeni Region
Prospecting Licenses
23
Acquisition of Primary Mining Licenses in Singida, Tanzania
On May 15, 2009, a subsidiary of the Company, Kilimanjaro
Mining Company Inc., entered into a Mineral Financing Agreement with a director
of the Company authorizing him, on behalf of the Company, to acquire Primary
Mining Licenses (PMLs) in the Singida area of Tanzania. On October 27, 2009,
an amended Mineral Financing Agreement was signed between the director (a
Tanzanian national) and the Company. The agreement was entered into as a result
of certain requirements under the Tanzania Mining Act as it relates to the
ability to hold title to Primary Mining Licenses (PMLs). The Mining Act allows
only a Tanzanian national or a Tanzanian corporation that is 100% owned by
Tanzanian nationals to hold title to PMLs. As a result, the Company entered into
the Mineral Financing Agreement along with a Statutory Declaration and
Declaration of Trust with one of its directors (a Tanzanian National) to
facilitate the optioning, exploration and purchase of the PMLs at the Singida
gold project. Upon application, approval and the issuing of a Special Mining
License that is comprised of two or more of the PMLs in the Singida project
area, the Company will become the registered owner on title.
At the option of the Company, any PMLs may be relinquished at
any time during the agreement and the title transferred back to the original
owner. Also, at the option of the Company, a 2% Net Smelter Production royalty
or 2% of the Net Sale Value may be substituted in place of the final payment for
each PML and paid on a pro rata basis determined by the total final number of
PMLs involved in a special mining license.
Under the terms of the mineral properties sales and purchase
agreements the Company has completed initial option payments in the amount of
$1,707,810. As of June 30, 2011, the Company has acquired 100% of 23 PMLs. The
Company has the option to acquire 37 additional and different PMLs in the
Singida area. Pursuant to the original agreement and the subsequent addendums,
the Company agreed to pay approximately $646,030 on August 9, 2011, $419,100 on
January 23, 2013 and $3,828,000 on February 24, 2013.
24
Acquisition of Prospecting Licenses in Tanzania
On April 20, 2011, the Company entered into a Prospecting
License Purchase Agreement with Pili Sadiki, to acquire a 100% interest in a
certain prospecting license located in the Kiabakari Musoma District of
Tanzania.
On April 20, 2011, the Company entered into a Prospecting
License Purchase Agreement with Rashid Omar, to acquire a 100% interest in a
certain prospecting license located in the Handeni Tanga District of
Tanzania.
On May 30, 2011, the Company entered into a Prospecting License
Purchase Agreement with Manga Mining Company to acquire a 100% interest in a
certain prospecting license located in the Handeni Tanga District of
Tanzania.
On July 1, 2011, the Company entered into a Prospecting License
Purchase Agreement with I. M. Kwematuku Export Trade Ltd. to acquire up to 100%
interest in a certain prospecting license located in the Handeni Tanga District
of Tanzania.
On July 19, 2011, Guardian Investment Ltd, a related party, on
behalf of the Company, entered into a mineral properties option agreement to
acquire four primary mining licenses within the license area of the Uyowa
project.
General
The following is a discussion and analysis of our plan of
operation and results of operations for the three month period ended June 30,
2011, and the factors that could affect our future financial condition. This
discussion and analysis should be read in conjunction with our consolidated
unaudited financial statements and the notes thereto included elsewhere in this
quarterly report. Our consolidated financial statements are prepared in
accordance with United States generally accepted accounting principles. All
references to dollar amounts in this section are in United States dollars unless
expressly stated otherwise.
Plan of Operation
As of June 30, 2011, we had working capital of approximately
$2,000,000. We plan to spend approximately $640,000 for our property
acquisitions and $1,270,000 for exploration activities through 2011, with work
being conducted on several projects including soil sampling, trenching and
drilling. We will need to raise additional funds to finance the exploration
activities on our projects. There is no assurance that such financing would be
available at this time.
Our estimated expenses over the next twelve months are as
follows:
Cash Requirements during the Next Twelve Months
Expense
|
|
($)
|
|
Property acquisition and holding costs
|
|
640,000
|
|
Exploration expenses
|
|
1,270,000
|
|
Professional fee
|
|
250,000
|
|
General and administration fee
|
|
1,030,000
|
|
Total
|
|
3,190,000
|
|
There is no historical financial information about us upon
which to base an evaluation of our performance. We are an exploration stage
corporation and have not generated any revenues from operations. We cannot
guarantee we will be successful in our business operations. Our business is
subject to risks inherent in the establishment of a new business enterprise,
including limited capital resources, possible delays in the exploration of our
properties, possible cost overruns due to price and cost increases for services
and economic conditions. Because the Company does not currently derive any
production revenue from operations, its ability to conduct exploration and
development on properties is largely based upon its ability to raise capital by
equity funding.
25
Our exploration objective is to find an economic mineral body
containing gold. Our success depends upon finding mineralized material. This
includes a determination by our contracted consultants and professional staff
whether the property contains resources and/or reserves. Mineralized material is
a mineralized body, which has been delineated by appropriately spaced drilling
or underground sampling to support sufficient tonnage and average percentage
grade of metals to justify removal. If we dont find mineralized material or we
cannot remove mineralized material, either because we do not have the money to
do so or because it is not economically feasible to do so, we will cease
operations or seek other properties.
RESULTS OF OPERATIONS
Three Month Summary
|
|
Three Months Ended
|
|
|
|
June 30,
|
|
|
|
2011
|
|
|
2010
|
|
Revenue
|
$
|
-
|
|
$
|
-
|
|
Expenses
|
|
403,656
|
|
|
525,989
|
|
Other income (expenses)
|
|
1,485,464
|
|
|
(633
|
)
|
Net Income (Loss)
|
$
|
1,081,808
|
|
$
|
(526,622
|
)
|
Revenue
We had no operating revenues for the three month period ended
June 30, 2011 and 2010. We anticipate that we will not generate any revenues
until we generate additional financing to support our planned operations.
Operating Costs and Expenses
The major components of our expenses for the three months ended
June 30, 2011 and 2010 are outlined in the table below:
|
|
Three Months Ended
|
|
|
|
June 30, 2011
|
|
|
June 30, 2010
|
|
Amortization and depreciation
|
|
7,125
|
|
|
5,775
|
|
Exploration costs
|
|
53,056
|
|
|
104,453
|
|
General and administrative
|
|
68,825
|
|
|
30,441
|
|
Management and director fees
|
|
5,000
|
|
|
31,500
|
|
Professional fees
|
|
100,025
|
|
|
312,316
|
|
Salaries
|
|
144,987
|
|
|
24,783
|
|
Travel and accommodation
|
|
24,638
|
|
|
16,721
|
|
Total Expenses
|
|
403,656
|
|
|
525,989
|
|
General and Administrative Expenses
The $38,384 increase in our general and administrative expenses
for the three month period ended June 30, 2011 as compared to the same period in
fiscal 2010 was primarily due to increase in computer related expenses, office
rent and insurance expenses.
Liquidity and Capital Resources
Working Capital
|
|
June 30, 2011
|
|
|
March 31, 2011
|
|
Current Assets
|
$
|
2,218,638
|
|
$
|
3,071,597
|
|
Current Liabilities
|
|
216,523
|
|
|
961,420
|
|
Working Capital
|
$
|
2,002,115
|
|
$
|
2,110,117
|
|
26
Cash Flows
|
|
Three Months
|
|
|
|
Ended
|
|
|
|
June 30, 2011
|
|
Cash used in Operating Activities
|
$
|
(466,354
|
)
|
Cash provided by Investing Activities
|
|
(255,894
|
)
|
Cash provided by Financing Activities
|
|
-
|
|
Net Increase (Decrease) in Cash
|
$
|
(722,248
|
)
|
We had an approximately cash balance of $1,560,000 and working
capital of $2,000,000 as of June 30, 2011 compared to cash of $2,282,901 and
working capital of $2,110,117 as of March 31, 2011. We anticipate that we will
incur approximately $1,280,000 for operating expenses, including professional,
legal and accounting expenses associated with our reporting requirements under
the Exchange Act during the next twelve months. Accordingly, we will need to
obtain additional financing in order to complete our full business plan.
Going Concern
The unaudited financial statements accompanying our quarterly
report on Form 10-Q for the quarter ended June 30, 2011 have been prepared on a
going concern basis, which implies that our company will continue to realize its
assets and discharge its liabilities and commitments in the normal course of
business. Our company has not generated revenues since inception and has never
paid any dividends and is unlikely to pay dividends or generate earnings in the
immediate future. The continuation of our company as a going concern is
dependent upon the continued financial support from our shareholders, the
ability of our company to obtain necessary equity financing to achieve our
operating objectives, and the attainment of profitable operations. As of June
30, 2011, we had cash of $1,560,654 and we estimate that we will require
approximately $1,280,000 for general and administration costs and professional
fees, and $1,910,000 for property acquisition holding and exploration costs
associated with our plan of operation over the next twelve months. Although we
have sufficient funds for general and administration activities, we do not have
sufficient funds for planned mineral property acquisition and exploration
activities and therefore we will be required to raise additional funds.
The advancement of our business is dependent upon us raising
additional financial support. The issuance of additional equity securities by us
could result in a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.
Future Financings
We had an approximate cash balance of $1,560,000 and working
capital of $2,000,000 as of June 30, 2011 compared to a cash balance of
$2,282,902 and working capital of $2,110,177 as of March 31, 2011 and we
estimate that we will require approximately $3,190,000 for costs associated with
our plan of operation over the next twelve months. Accordingly, we do not have
sufficient funds for planned operations and we will be required to raise
additional funds for operations. We intend to raise additional funds from
another equity offering or loans. At the present time, we are attempting to
raise additional money, but there is no assurance that we will be successful. If
we need additional funds and are unable to raise them, we will have to suspend
or cease operations until we succeed in raising additional funds.
Outstanding shares and options
As of August 15, 2011, we have 97,458,733 shares of common
stock outstanding, 4,200,000 stock options outstanding and 41,404,901 warrants
outstanding.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources that are material to
stockholders.
27
1.
Risks And
Uncertainties
Much of the information included in this quarterly report
includes or is based upon estimates, projections or other forward looking
statements. Such forward looking statements include any projections and
estimates made by us and our management in connection with our business
operations. 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.
Such estimates, projections or other forward looking
statements involve various risks and uncertainties as outlined below. We
caution the reader that important factors in some cases have affected and, in
the future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other forward looking statements.
Risks Associated with Mining
All of our properties are in the exploration stage. There is
no assurance that we can establish the existence of any mineral resource on any
of our properties in commercially exploitable quantities. Until we can do so, we
cannot earn any revenues from operations and if we do not do so we will lose all
of the funds that we expend on exploration. If we do not discover any mineral
resource in a commercially exploitable quantity, our business could fail.
Despite exploration work on our mineral properties, we have not
established that any of them contain any mineral reserve, nor can there be any
assurance that we will be able to do so. If we do not, our business could
fail.
A mineral reserve is defined by the Securities and Exchange
Commission in its Industry Guide 7 (which can be viewed over the Internet at
http://www.sec.gov/divisions/corpfin/forms/industry.htm#secguide7
) as
that part of a mineral deposit which could be economically and legally extracted
or produced at the time of the reserve determination. The probability of an
individual prospect ever having a reserve that meets the requirements of the
Securities and Exchange Commissions Industry Guide 7 is extremely remote; in
all probability our mineral resource property does not contain any reserve and
any funds that we spend on exploration will probably be lost.
Even if we do eventually discover a mineral reserve on one or
more of our properties, there can be no assurance that we will be able to
develop our properties into producing mines and extract those resources. Both
mineral exploration and development involve a high degree of risk and few
properties which are explored are ultimately developed into producing mines.
The commercial viability of an established mineral deposit will
depend on a number of factors including, by way of example, the size, grade and
other attributes of the mineral deposit, the proximity of the resource to
infrastructure such as a smelter, roads and a point for shipping, government
regulation and market prices. Most of these factors will be beyond our control,
and any of them could increase costs and make extraction of any identified
mineral resource unprofitable.
Mineral operations are subject to applicable law and
government regulation. Even if we discover a mineral resource in a commercially
exploitable quantity, these laws and regulations could restrict or prohibit the
exploitation of that mineral resource. If we cannot exploit any mineral resource
that we might discover on our properties, our business may fail.
Both mineral exploration and extraction require permits from
various foreign, federal, state, provincial and local governmental authorities
and are governed by laws and regulations, including those with respect to
prospecting, mine development, mineral production, transport, export, taxation,
labour standards, occupational health, waste disposal, toxic substances, land
use, environmental protection, mine safety and other matters. There can be no
assurance that we will be able to obtain or maintain any of the permits required
for the continued exploration of our mineral properties or for the construction
and operation of a mine on our properties at economically viable costs. If we
cannot accomplish these objectives, our business could fail.
28
We believe that we are in compliance with all material laws and
regulations that currently apply to our activities but there can be no assurance
that we can continue to remain in compliance. Current laws and regulations could
be amended and we might not be able to comply with them, as amended. Further,
there can be no assurance that we will be able to obtain or maintain all permits
necessary for our future operations, or that we will be able to obtain them on
reasonable terms. To the extent such approvals are required and are not
obtained, we may be delayed or prohibited from proceeding with planned
exploration or development of our mineral properties.
Our business activities are conducted in Tanzania.
Our mineral exploration activities in Tanzania may be affected
in varying degrees by political stability and government regulations relating to
the mining industry and foreign investment in that country. The government of
Tanzania may institute regulatory policies that adversely affect the exploration
and development (if any) of the Companys properties. Any changes in regulations
or shifts in political conditions in this country are beyond the control of the
Company and may adversely affect its business. Investors should assess the
political and regulatory risks related to the Companys foreign country
investments. Our operations may be affected in varying degrees by government
regulations with respect to restrictions on production, price controls, export
controls, foreign exchange controls, income taxes, expropriation of property,
environmental legislation and mine safety.
We may not have clear title to our properties.
Acquisition of title to mineral properties is a very detailed
and time-consuming process, and the Companys title to its properties may be
affected by prior unregistered agreements or transfers, or undetected defects.
Several of the Companys prospecting licenses are currently subject to renewal
by the Ministry of Energy and Minerals of Tanzania. In result, there is a risk
that we may not have clear title to all our mineral property interests, or they
may be subject to challenge or impugned in the future. We have exploration
licenses. We do not have a license to mine any minerals or reserves whatsoever
at this time on any part of our properties. Once exploration has advanced to a
point where mining on one or more of our properties is feasible, we plan to
apply for a mining license or licenses.
If we establish the existence of a mineral resource on any
of our properties in a commercially exploitable quantity, we will require
additional capital in order to develop the property into a producing mine. If we
cannot raise this additional capital, we will not be able to exploit the
resource, and our business could fail.
If we do discover mineral resources in commercially exploitable
quantities on any of our properties, we will be required to expend substantial
sums of money to establish the extent of the resource, develop processes to
extract it and develop extraction and processing facilities and infrastructure.
Although we may derive substantial benefits from the discovery of a major
deposit, there can be no assurance that such a resource will be large enough to
justify commercial operations, nor can there be any assurance that we will be
able to raise the funds required for development on a timely basis. If we cannot
raise the necessary capital or complete the necessary facilities and
infrastructure, our business may fail.
Mineral exploration and development is subject to
extraordinary operating risks. We do not currently insure against these risks.
In the event of a cave-in or similar occurrence, our liability may exceed our
resources, which would have an adverse impact on our company.
Mineral exploration, development and production involve many
risks, which even a combination of experience, knowledge and careful evaluation
may not be able to overcome. Our operations will be subject to all the hazards
and risks inherent in the exploration for mineral resources and, if we discover
a mineral resource in commercially exploitable quantity, our operations could be
subject to all of the hazards and risks inherent in the development and
production of resources, including liability for pollution, cave-ins or similar
hazards against which we cannot insure or against which we may elect not to
insure. Any such event could result in work stoppages and damage to property,
including damage to the environment. We do not currently maintain any insurance
coverage against these operating hazards. The payment of any liabilities that
arise from any such occurrence would have a material adverse impact on our
company.
29
Mineral prices are subject to dramatic and unpredictable
fluctuations.
We expect to derive revenues, if any, either from the sale of
our mineral resource properties or from the extraction and sale of precious and
base metals such as gold, silver and copper. The price of those commodities has
fluctuated widely in recent years, and is affected by numerous factors beyond
our control, including international, economic and political trends,
expectations of inflation, currency exchange fluctuations, interest rates,
global or regional consumptive patterns, speculative activities and increased
production due to new extraction developments and improved extraction and
production methods. The effect of these factors on the price of base and
precious metals, and therefore the economic viability of any of our exploration
properties and projects, cannot accurately be predicted.
The mining industry is highly competitive and there is no
assurance that we will continue to be successful in acquiring mineral claims. If
we cannot continue to acquire properties to explore for mineral resources, we
may be required to reduce or cease operations.
The mineral exploration, development, and production industry
is largely un-integrated. We compete with other exploration companies looking
for mineral resource properties. While we compete with other exploration
companies in the effort to locate and acquire mineral resource properties, we
will not compete with them for the removal or sales of mineral products from our
properties if we should eventually discover the presence of them in quantities
sufficient to make production economically feasible. Readily available markets
exist worldwide for the sale of mineral products. Therefore, we will likely be
able to sell any mineral products that we identify and produce.
In identifying and acquiring mineral resource properties, we
compete with many companies possessing greater financial resources and technical
facilities. This competition could adversely affect our ability to acquire
suitable prospects for exploration in the future. Accordingly, there can be no
assurance that we will acquire any interest in additional mineral resource
properties that might yield reserves or result in commercial mining operations.
If our costs of exploration are greater than anticipated,
then we may not be able to complete the exploration program for our Tanzanian
properties without additional financing, of which there is no assurance that we
would be able to obtain.
We are proceeding with the initial stages of exploration on our
Tanzanian properties. We are carrying out an exploration program that has been
recommended by a consulting geologist. This exploration program outlines a
budget for completion of the recommended exploration program. However, there is
no assurance that our actual costs will not exceed the budgeted costs. Factors
that could cause actual costs to exceed budgeted costs include increased prices
due to competition for personnel and supplies during the exploration season,
unanticipated problems in completing the exploration program and delays
experienced in completing the exploration program. Increases in exploration
costs could result in our not being able to carry out our exploration program
without additional financing. There is no assurance that we would be able to
obtain additional financing in this event.
Because of the speculative nature of exploration of mining
properties, there is substantial risk that no commercially exploitable minerals
will be found and our business will fail.
We are in the initial stage of exploration of our mineral
property, and thus have no way to evaluate the likelihood that we will be
successful in establishing commercially exploitable reserves of gold, silver or
other valuable minerals on our Tanzanian properties.
The search for valuable minerals as a business is extremely
risky. We may not find commercially exploitable reserves of gold, silver or
other valuable minerals in our mineral property. Exploration for minerals is a
speculative venture necessarily involving substantial risk. The expenditures to
be made by us on our exploration program may not result in the discovery of
commercial quantities of ore. The likelihood of success must be considered in
light of the problems, expenses, difficulties, complications and delays
encountered in connection with the exploration of the mineral properties that we
plan to undertake. 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 complete our business
plan.
30
Because our executive officers have limited experience in
mineral exploration and do not have formal training specific to the
technicalities of mineral exploration, there is a higher risk that our business
will fail.
Our executive officers have limited experience in mineral
exploration and do not have formal training as geologists or in the technical
aspects of management of a mineral resource exploration company. As a result of
this inexperience, there is a higher risk of our being unable to complete our
business plan for the exploration of our mineral property. With no direct
training or experience in these areas, our management may not be fully aware of
many of the specific requirements related to working within this industry. Our
decisions and choices may not take into account standard engineering or
managerial approaches mineral resource exploration companies commonly use.
Consequently, the lack of training and experience of our management in this
industry could result in management making decisions that could result in a
reduced likelihood of our being able to locate commercially exploitable reserves
on our mineral property with the result that we would not be able to achieve
revenues or raise further financing to continue exploration activities. In
addition, we will have to rely on the technical services of others with
expertise in geological exploration in order for us to carry out our planned
exploration program. If we are unable to contract for the services of such
individuals, it will make it difficult and maybe impossible to pursue our
business plan. There is thus a higher risk that our operations, earnings and
ultimate financial success could suffer irreparable harm and our business will
likely fail.
Risks Relating to Our Common Stock
If we issue additional shares in the future, it will result
in the dilution of our existing shareholders.
Our articles of incorporation authorize the issuance of up to
250,000,000 shares of common stock with a par value of $0.00001 per share. Our
board of directors may choose to issue some or all of such shares to acquire one
or more businesses or to provide additional financing in the future. The
issuance of any such shares will reduce the book value and market price of the
outstanding shares of our common stock. If we issue any such additional shares,
such issuance will reduce the proportionate ownership and voting power of all
current shareholders. Further, such issuance may result in a change of control
of our corporation.
Our common stock is illiquid and shareholders may be unable
to sell their shares.
There is currently a limited market for our common stock and we
can provide no assurance to investors that a market will develop. If a market
for our common stock does not develop, our shareholders may not be able to
re-sell the shares of our common stock that they have purchased and they may
lose all of their investment. Public announcements regarding our company,
changes in government regulations, conditions in our market segment or changes
in earnings estimates by analysts may cause the price of our common shares to
fluctuate substantially. In addition, stock prices for junior mineral
exploration companies fluctuate widely for reasons that may be unrelated to
their operating results. These fluctuations may adversely affect the trading
price of our common shares.
Penny stock rules will limit the ability of our stockholders
to sell their stock.
The Securities and Exchange Commission has adopted regulations
which generally define 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 Securities and
Exchange Commission 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 customers 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 customers 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 purchasers 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.
31
The Financial Industry Regulatory Authority, or FINRA, has
adopted sales practice requirements which may also limit a shareholders ability
to buy and sell our stock.
In addition to the penny stock rules described above, FINRA
has adopted rules that require that in recommending an investment to a customer,
a broker-dealer must have reasonable grounds for believing that the investment
is suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customers financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative
low priced securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for its shares.
Because of the early stage of development and the nature of
our business, our securities are considered highly speculative.
Our securities must be considered highly speculative, generally
because of the nature of our business and the early stage of our development. We
are engaged in the business of identifying, acquiring, exploring and developing
commercial reserves of primarily gold and potentially uranium. Our properties
are in the exploration stage only and are without known reserves of gold and/or
uranium. Accordingly, we have not generated any revenues nor have we realized a
profit from our operations to date and there is little likelihood that we will
generate any revenues or realize any profits in the short term. Any
profitability in the future from our business will be dependent upon locating
and developing economic reserves of gold and/or uranium, which itself is subject
to numerous risk factors as set forth herein. Since we have not generated any
revenues, we will have to raise additional monies through the sale of our equity
securities or debt in order to continue our business operations.
We do not intend to pay dividends on any investment in the
shares of stock of our company.
We have never paid any cash dividends and currently do not
intend to pay any dividends for the foreseeable future. To the extent that we
require additional funding currently not provided for in our financing plan, our
funding sources may prohibit the payment of a dividend. Because we do not intend
to declare dividends, any gain on an investment in our company will need to come
through an increase in the stocks price. This may never happen and investors
may lose all of their investment in our company.
Risks Related to Our Company
Our by-laws contain provisions indemnifying our officers and
directors.
Our by-laws provide the indemnification of our directors and
officers to the fullest extent legally permissible under the Nevada corporate
law against all expenses, liability and loss reasonably incurred or suffered by
them in connection with any action, suit or proceeding. Furthermore, our by-laws
provide that our board of directors may cause our company to purchase and
maintain insurance for our directors and officers, and we have implemented
director and officer insurance coverage.
Because most of our directors and officers are residents of
other countries other than the United States, investors may find it difficult to
enforce, within the United States, any judgments obtained against our directors
and officers.
Most of our directors and officers are nationals and/or
residents of countries other than the United States, and all or a substantial
portion of such persons assets are located outside the United States. As a
result, it may be difficult for investors to enforce within the United States
any judgments obtained against our officers or directors, including judgments predicated upon the civil liability provisions of the
securities laws of the United States or any state thereof.
32
Item 3. Quantitative and Qualitative Disclosures About
Market Risk.
Not Applicable.
Item 4. Controls and Procedures.
As required by Rule 13a-15 of the Securities Exchange Act of
1934, our principal executive officer and principal financial officer evaluated
our companys disclosure controls and procedures (as defined in Rules 13a-15(e)
of the Securities Exchange Act of 1934) as of the end of the period covered by
this report. Based on this evaluation, our principal executive officer and
principal financial officer concluded that as of the end of the period covered
by this report, these disclosure controls and procedures were not effective.
Disclosure controls and procedures are controls and other procedures that are
designed to ensure that the information required to be disclosed by our company
in reports it files or submits under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods specified
in the rules and forms of the Securities Exchange Commission and to ensure that
such information is accumulated and communicated to our companys management,
including our principal executive officer and principal financial officer, to
allow timely decisions regarding required disclosure. The conclusion that our
disclosure controls and procedures were not effective was due to the presence of
the following material weaknesses in internal control over financial reporting
which are indicative of many small companies with small staff: (i) inadequate
segregation of duties and effective risk assessment; and (ii) insufficient
written policies and procedures for accounting and financial reporting with
respect to the requirements and application of both United States generally
accepted accounting principles and Securities and Exchange Commission
guidelines. Management anticipates that such disclosure controls and procedures
will not be effective until the material weaknesses are remediated.
We plan to take steps to enhance and improve the design of our
internal controls over financial reporting. During the period covered by this
quarterly report on Form 10-Q, we have not been able to remediate the material
weaknesses identified above. To remediate such weaknesses, we plan to implement
the following changes during our fiscal year ending March 31, 2012, subject to
obtaining additional financing: (i) appoint additional qualified personnel to
address inadequate segregation of duties and ineffective risk management; and
(ii) adopt sufficient written policies and procedures for accounting and
financial reporting. The remediation efforts set out above are largely dependent
upon our securing additional financing to cover the costs of implementing the
changes required. If we are unsuccessful in securing such funds, remediation
efforts may be adversely effected in a material manner.
It should be noted that while our management believes our
disclosure controls and procedures provide a reasonable level of assurance, they
do not expect that our disclosure controls and procedures or internal controls
will prevent all error and all fraud. A control system, no matter how well
conceived or operated, can provide only reasonable, not absolute, assurance that
the objectives of the control system are met. Further, the design of a control
system must reflect the fact that there are resource constraints, and the
benefits of controls must be considered relative to their costs. Because of the
inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if
any, within our company have been detected. These inherent limitations include
the realities that judgments in decision making can be faulty, and that
breakdowns can occur because of simple error or mistake. Additionally, controls
can be circumvented by the individual acts of some persons, by collusion of two
or more people, or by management override of the controls. The design of any
system of internal control is based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions.
Over time, controls may become inadequate because of changes in conditions, or
the degree of compliance with the policies or procedures may deteriorate.
Because of the inherent limitations in a cost-effective control system,
misstatements due to error or fraud may occur and not be detected.
There were no changes in our internal control over financial
reporting during the three month period ended June 30, 2011 that have materially
affected or are reasonably likely to materially affect, our internal control
over financial reporting.
33
PART II - OTHER INFORMATION
ITEM 1A. RISK FACTORS.
Not Applicable.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS.
On April 20, 2011, the Company signed license purchase
agreements to acquire one prospecting license comprising the Handeni Gold
Project. The total consideration was $113,250, of which $77,250 was paid on
April 29, 2011 and $36,000 is due on receipt of license. On June 14 and June 20,
2011 the Company paid a finders fee of $60,000 in cash and issued 400,000
common shares with a fair value of $108,000. We issued these shares to one
non-U.S. person (as that term is defined in Regulation S of the Securities Act
of 1933) in an offshore transaction in which we relied on the registration
exemption provided for in Regulation S and/or Section 4(2) of the Securities Act
of 1933.
On May 30, 2011, the Company signed prospecting licence
purchase agreements comprising the Handeni Gold Project to acquire one
prospecting license. The total consideration includes:
1)
|
paying $10,000 within 5 days after execution date. The
payment was made on June 16, 2011;
|
|
|
2)
|
paying a total amount of $450,000 to the owner of the
license, of which $70,000 due in 2011, $170,000 due in 2012 and $200,000
due in 2013
|
|
|
3)
|
paying a finders fee of $30,000 and 300,000 common
shares. On June 14 and 20, 2011, the Company paid $3,000 in cash and
issued 30,000 common shares with a fair value of $8,100. We issued these
shares to one non-U.S. person (as that term is defined in Regulation S of
the Securities Act of 1933) in an offshore transaction in which we relied
on the registration exemption provided for in Regulation S and/or Section
4(2) of the Securities Act of 1933.
|
On April 20, 2011, the Company signed license purchase
agreements to acquire one prospecting license comprising the Buhemba Project.
The total consideration was $112,150, of which $89,650 was paid on April 29,
2011 and $22,500 is due on receipt of license. On June 14 and June 20, 2011 the
Company paid a finders fee of $60,000 in cash and issued 400,000 common shares
with a fair value of $108,000. We issued these shares to one non-U.S. person (as
that term is defined in Regulation S of the Securities Act of 1933) in an
offshore transaction in which we relied on the registration exemption provided
for in Regulation S and/or Section 4(2) of the Securities Act of 1933.
On April 20 and May 30, 2011, the Company entered into three
prospecting licences purchase agreements to acquire three prospecting licenses.
As per the agreements, the Company agreed to pay a finders fee of 830,000
common shares. On June 20, 2011, the Company issued 830,000 common shares with a
fair value of $224,100 as finders fee to a company. We issued these shares to
one non-U.S. person (as that term is defined in Regulation S of the Securities
Act of 1933) in an offshore transaction in which we relied on the registration
exemption provided for in Regulation S and/or Section 4(2) of the Securities Act
of 1933.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. (REMOVED AND RESERVED).
ITEM 5. OTHER INFORMATION.
None.
34
ITEM 6. EXHIBITS
Exhibit
|
|
Number
|
Description
|
3.1
|
Articles of
Incorporation (incorporated by reference from our Registration Statement
on Form SB-2, filed on June 6, 2007)
|
3.2
|
Certificate of Amendment dated
December 7, 2010 (incorporated by reference from our Current Report on
Form 8-K dated December 10, 2010)
|
3.3
|
Amended and Restated
Bylaws (incorporated by reference from our Current Report on Form 8-K
filed on June 7, 2011)
|
4.1
|
Specimen Stock Certificate
(incorporated by reference from our Registration Statement on Form SB-2
filed on June 6, 2007)
|
4.2
|
Form of Warrant
Certificate for Offering Completed September 7, 2010 (incorporated by
reference from our Quarterly Report on Form 10-Q filed on November 23,
2010)
|
10.1
|
License (incorporated by reference
from our Registration Statement on Form SB-2, filed on June 6, 2007)
|
10.2
|
Amendment to License
Agreement, dated June 3, 2008 (incorporated by reference from our Annual
Report on Form 10-K filed on June 26, 2008)
|
10.3
|
Option Agreement with Geo Can
Resources Company Limited (incorporated by reference from our Annual
Report on Form 10-K filed on July 14, 2009)
|
10.4
|
Binding Letter
Agreement with Kilimanjaro Mining Company Inc. (incorporated by reference
from our Annual Report on Form 10-K filed on July 14, 2009)
|
10.5
|
Consulting Services Agreement with
Stocks That Move (incorporated by reference from our Quarterly Report on
Form 10-Q filed on November 23, 2009)
|
10.6
|
Consulting Agreement
with Robert Lupo (incorporated by reference from our Quarterly Report on
Form 10-Q filed on February 22, 2010)
|
10.7
|
Addendum to the Consulting Agreement
with Robert Lupo (incorporated by reference from our Quarterly Report on
Form 10-Q filed on February 22, 2010)
|
10.8
|
Finders Fee
Agreement with Robert A. Young and the RAYA Group (incorporated by
reference from our Annual Report on Form 10-K filed on July 14, 2019)
|
10.9
|
Termination of the Consulting
Agreement with Robert Lupo (incorporated by reference from our Annual
Report on Form 10-K filed on July 14, 2010)
|
10.10
|
Consulting Agreement
with Clive Howard Matthew King (incorporated by reference from our Annual
Report on Form 10-K filed on July 14, 2010)
|
10.11
|
Consulting Agreement dated October 7,
2010 between the Company and Misac Noubar Nabighian (incorporated by
reference from our Current Report on Form 8-K filed on October 13, 2010)
|
10.12
|
2010 Stock Option
Plan (incorporated by reference from our Current Report on Form 8-K filed
on October 13, 2010)
|
10.13
|
Stock Exchange Agreement with
Kilimanjaro Mining Company, Inc. and their selling shareholders
(incorporated by reference from our Quarterly Report on Form 10-Q filed on
November 23, 2009)
|
10.14
|
Form of Subscription
Agreement for Offering Completed September 7, 2010 (incorporated by
reference from our Quarterly Report on Form 10-Q filed on November 23,
2010)
|
10.15
|
Amendment No. 1 to Consulting
Agreement between the Company and Clive King dated effective November 11,
2010 (incorporated by reference from our Quarterly Report on Form 10-Q
filed on November 23, 2010)
|
10.16
|
Form of Mineral
Property Sales Agreement dated May 15, 2009, July 29, 2009, August 28,
2009 and November 19, 2009 between a director of the Company and the
landowners listed below (collectively the Landowners) (incorporated by
reference from our Quarterly Report on Form 10-Q filed on November 23,
2010):
|
|
No
|
Owners Name
|
|
S01
|
Pius Joackim Game in
Parenership with Mustafa Kaombwe and Msua Mkumbo
|
|
S03
|
Mohamed Suleimani and Partners Plus Chombo,
Alfred Joakim and Heri S. Mhula
|
|
S04
|
Maswi Marwa In Partnership with
Robert Malando, Andrew Julius Marando and Mathew Melania
|
35
Exhibit
|
|
|
Number
|
|
Description
|
|
S05
|
John Bina Wambura in
Partnership with Fabiano Lango
|
|
S06
|
Elizabeth Shango
|
|
S07
|
Athuman Chiboni in Partnership
with Maswi Marwa and Robert Malando
|
|
S08
|
Malando Maywili in Partnership with Charles
Mchembe
|
|
S09
|
Robert Malando
|
|
S10
|
Raymond Athumani Munyawi
|
|
S11
|
Jeremia K. Lulu in Partnership
with Agnes Musa, Juma Shashu, Neema Safari, Neema Tungaraza, Safari
Neema Tungaraza, Safari Meema and Simon Gidazada
|
|
S12
|
Heri S. Mhula and partners Samweli Sumbuka,
Plus Gam and Shambulingole
|
|
S13
|
Limbu Magambo Nyoda and
Partners Saba Joseph, Bakari Kahinda
|
|
S14
|
Shambuli Sumbuka in Partnership with Limbu
Gambo
|
|
S15
|
Salama Mselemu
|
|
S16
|
John Bina Wambura in Partnership with Bosco
Sevelin Chaila; Plus Game; Saimon Jonga
|
|
S17
|
John Bina Wambura in
Partnership with Jumanne Mtemi; Anton Gidion; Bosco Sevelin Chaila; Plus
Game; Saimon Jonga
|
|
S18
|
Limbu Magambo in Partnership with Pous GamI and
Shambuli Sumbuka
|
|
S19
|
Lukas Mmary in Partnership with
Henry Pajero, John Bina, Massanja Game, Mwajuma Joseph, Mwita Magita and
Plus Game
|
|
S20
|
Maswi Marwa In Partnership with Shagida
malando; Marwa Marwa; Benidict Mitti and Fred Mgongo
|
|
S21
|
Mustafa IDD Kaombwe
|
|
S22
|
Mustafa IDD Kaombwe in Partnership with Mahega
Malugoyi; Julias Kamana; Ramadhani Lyanga and Abas Mustafa
|
|
S23
|
Ramadhani Mohamed Lyanga In
partnership With Mustafa Kaombwe and Bethod Njega
|
|
S24
|
Ales David Kajoro in partnership with Henry
Ignas; Daud Peter and Julias Charles Rugiga
|
|
S25
|
Joel Mazemle in Partnership
with Christina Mazemle, Plus Chombo and Limbu Magambo Nyoda
|
|
S26
|
Idd Ismail in Partnership with Bakari Abdi,
Elizabeth U. Yohana, Emanuel Marco, Hamisi Ramadhan, Husein
Hasan, Mnaya Hosea, and Sanane Msigalali
|
10.17
|
Form of Addendum No.
1 to Mineral Property Sales Agreement dated September 18, 2009 between a
director of the Company and the Landowners (incorporated by reference from
our Quarterly Report on Form 10-Q filed on November 23, 2010)
|
10.18
|
Form of Addendum No. 2 to Mineral
Property Sales Agreement dated January 18, 2010 between a director of the
Company and the Landowners (incorporated by reference from our Quarterly
Report on Form 10-Q filed on November 23, 2010)
|
10.19
|
Form of Addendum No.
3 to Mineral Property Sales Agreement dated July 27, 2010 between a
director of the Company and the Landowners (incorporated by reference from
our Quarterly Report on Form 10- Q filed on November 23, 2010)
|
10.20
|
Mineral Financing Agreement between
the Company and Ahmed Magoma dated October 19, 2009 (incorporated by
reference from our Quarterly Report on Form 10-Q filed on November 23,
2010)
|
10.21
|
Property Purchase
Agreement between Geo Can Resources Company Limited and Kilimanjaro Mining
Company, Inc dated May 5, 2009(incorporated by reference from our
Quarterly Report on Form 10-Q filed on November 23, 2010)
|
10.22
|
Amendment to Mineral Financing
Agreement between the Company and Ahmed Magoma dated October 27, 2009
(incorporated by reference from our Quarterly Report on Form 10-Q filed on
November 23, 2010)
|
10.23
|
Declaration of Trust
of Geo Can Resources Company Limited dated July 23, 2009 (incorporated by
reference from our Quarterly Report on Form 10-Q filed on November 23,
2010)
|
10.24
|
Form of Subscription Agreement for
non US Subscribers (incorporated by reference from our Current Report on
Form 8-K filed on March 11, 2011)
|
10.25
|
Form of Subscription
Agreement for US Subscribers (incorporated by reference from our Current
Report on Form 8-K filed on March 11, 2011)
|
10.26
|
Consulting Agreement dated April 26,
2011 between David Kalenuik and the Company (incorporated by reference
from our Current Report on Form 8-K filed on May 2, 2011)
|
10.27
|
Consulting Agreement
dated April 26, 2011 between Roger Newell and the Company (incorporated by
reference from our Current Report on Form 8-K filed on May 2, 2011)
|
10.28
|
Employment Agreement dated April 26,
2011 between Heidi Kalenuik and the Company (incorporated by reference
from our Current Report on Form 8-K filed on May 2, 2011)
|
36
Exhibit
|
|
Number
|
Description
|
10.29
|
Employment Agreement dated
April 26, 2011 between Ming Zhu and the Company (incorporated by reference
from our Current Report on Form 8-K filed on May 2, 2011)
|
10.30
|
Geita Option Agreement dated
May 6, 2011 between Otterburn Ventures Inc. and the Company (incorporated
by reference from our Current Report on Form 8-K filed on May 12, 2011)
|
10.31
|
Kalemela Option Agreement dated
May 6, 2011 between Otterburn Ventures Inc. and the Company (incorporated
by reference from our Current Report on Form 8-K filed on May 12, 2011)
|
10.32
|
North Mara Option Agreement
dated May 6, 2011 between Otterburn Ventures Inc. and the Company
(incorporated by reference from our Current Report on Form 8-K filed on
May 12, 2011)
|
10.33
|
Singida Option Agreement dated
May 6, 2011 among Otterburn Ventures Inc., the Company and Ahmed Abubakar
Magoma (incorporated by reference from our Current Report on Form 8-K
filed on May 12, 2011)
|
14.1
|
Code of Ethics (incorporated by
reference from our Annual Report on Form 10-K filed on June 26, 2008)
|
31.1*
|
Certification of Chief
Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
31.2*
|
Certification of Chief
Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
32.1*
|
Certification of Chief
Executive Officer pursuant Section 906 Certifications under Sarbanes-Oxley
Act of 2002
|
32.2*
|
Certification of Chief
Financial Officer pursuant Section 906 Certifications under Sarbanes-Oxley
Act of 2002
|
99.2
|
Audit Committee Charter
(incorporated by reference from our Annual Report on Form 10-K filed on
June 26, 2008)
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99.3
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Disclosure Committee Charter
(incorporated by reference from our Annual Report on Form 10-K filed on
June 26, 2008)
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EX-101.INS
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XBRL INSTANCE DOCUMENT
|
EX-101.SCH
|
XBRL TAXONOMY EXTENSION
SCHEMA
|
EX-101.CAL
|
XBRL TAXONOMY EXTENSION
CALCULATION LINKBASE
|
EX-101.DEF
|
XBRL TAXONOMY EXTENSION
DEFINITION LINKBASE
|
EX-101.LAB
|
XBRL TAXONOMY EXTENSION LABEL
LINKBASE
|
EX-101.PRE
|
XBRL TAXONOMY EXTENSION
PRESENTATION LINKBASE
|
* Filed herewith.
37
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
LAKE VICTORIA MINING COMPANY, INC.
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|
|
|
|
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By
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/s/ David Kalenuik
|
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David Kalenuik
|
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President and Chief Executive Officer
|
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(Principal Executive Officer)
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Date:
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August 11, 2011
|
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By
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/s/ Ming Zhu
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Ming Zhu
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Chief Financial Officer
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(Principal Accounting Officer and Principal
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Financial Officer)
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Date:
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August 11, 2011
|
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