U.S. SECURITIES AND EXCHANGE
COMMISSION
Washington,
D.C. 20549
FORM 10-K
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE
ACT OF 1934
For
the fiscal year ended March 31, 2010
Commission
file number: 333-151419
RANGER
GOLD CORP.
(Exact
name of registrant as specified in its charter)
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Nevada
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74-3206736
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(State
of incorporation)
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(I.R.S.
Employer Identification No.)
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2533 N.
Carson Street, Suite 5018
Carson City, Nevada,
89706
(Address
of principal executive offices)
(775)
888-3133
(Registrant’s
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Exchange Act:
None
Securities
registered pursuant to Section 12(g) of the Exchange Act:
Common
Stock, $0.0001 par value
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes
¨
No
x
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes
¨
No
x
Indicate
by check mark whether the registrant (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act 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 if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.
x
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
Large
accelerated filer
¨
Accelerated
filer
¨
Non-accelerated
filer
¨
(Do not
check if a smaller reporting
company) Smaller
Reporting Company
x
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes
¨
No
x
The
issuer’s revenues for its most recent fiscal year were $Nil
The
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the average bid and asked price of such
common equity as September 30, 2009 was approximately $600,000.
The
number of shares of the issuer’s common stock issued and outstanding as of June
24, 2010 was 46,020,000 shares.
Documents
Incorporated By Reference: None
1
TABLE OF
CONTENTS
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Page | ||
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Glossary
of Mining Terms
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PART
I
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Item
1
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Business
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6 | |
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Item
1A
Item
1B
Item
2
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Risk
Factors
Unresolved
Staff Comments
Properties
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10
14
14
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Item
3
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Legal
Proceedings
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21 | |
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Item
4
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(Removed
and Reserved)
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21 | |
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PART
II
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Item
5
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Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
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22 | |
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Item
6
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Selected
Financial Data
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24 | |
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Item
7
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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24 | |
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Item
7A
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Quantitative
and Qualitative Disclosures About Market Risk.
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30 | |
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Item
8
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Financial
Statements and Supplementary Data.
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30 | |
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Item
9
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Changes
in and Disagreements With Accountants on Accounting and Financial
Disclosure
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30 | |
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Item
9A
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Controls
and Procedures
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30 | |
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Item
9B
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Other
Information
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32 | |
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PART
III
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Item
10
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Directors,
Executive Officers and Corporate Governance
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32 | |
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Item
11
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Executive
Compensation
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34 | |
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Item
12
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Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
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35 | |
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Item
13
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Certain
Relationships and Related Transactions, and Director
Independence
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35 | |
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Item
14
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Principal
Accountant Fees and Services
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36 | |
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PART
IV
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Item
15
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Exhibits,
Financial Statement Schedules
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37 | |
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SIGNATURES
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39 | ||
2
Glossary of Mining
Terms
Adit(s),
Historic working
driven horizontally, or nearly so into a hillside to explore for and exploit
ore.
Adularia.
A potassium-rich
alteration mineral – a form of orthoclase.
Ag.
Elemental symbol for
silver.
Air track holes.
Drill hole
constructed with a small portable drill rig using an air-driven
hammer.
Au.
Elemental symbol for
gold.
Core holes.
A hole in the
ground that is left after the process where a hollow drill bit with diamond chip
teeth is used to drill into the ground. The center of the hollow drill fills
with the core of the rock that is being drilled into, and when the drill is
extracted, a hole is left in the ground.
Felsic Tertiary Volcanic
Rocks.
Quartz-rich rocks derived from volcanoes and deposited between two
and sixty-five million years ago.
Geochemical sampling.
Sample
of soil, rock, silt, water or vegetation analyzed to detect the presence of
valuable metals or other metals which may accompany them. For example, arsenic
may indicate the presence of gold.
Geologic mapping.
Producing a
plan and sectional map of the rock types, structure and alteration of a
property.
Geophysical survey.
Electrical, magnetic, gravity and other means used to detect features,
which may be associated with mineral deposits
Leaching
. Leaching is a cost
effective process where ore is subjected to a chemical liquid that dissolves the
mineral component from ore, and then the liquid is collected and the metals
extracted from it.
Level(s),
Main underground
passage driven along a level course to afford access to stopes or workings and
provide ventilation and a haulageway for removal of ore.
Magnetic lows.
An occurrence
that may be indicative of a destruction of magnetic minerals by later
hydrothermal (hot water) fluids that have come up along faults. These
hydrothermal fluids may in turn have carried and deposited precious metals such
as gold and/or silver.
Plug.
A vertical pipe-like
body of magma representing a volcanic vent similar to a dome.
Quartz Monzonite.
A medium to
coarse crystalline rock composed primarily of the minerals quartz, plagioclase
and orthoclase.
Quartz Stockworks.
A
multi-directional system of quartz veinlets.
3
RC holes.
Short form for
Reverse Circulation Drill holes. These are holes left after the process of
Reverse Circulation Drilling.
Resource.
An estimate of the
total tons and grade of a mineral deposit defined by surface sampling, drilling
and occasionally underground sampling of historic diggings when
available.
Reverse circulation drilling.
A less expensive form of drilling than coring that does not allow for the
recovery of a tube or core of rock. The material is brought up from depth as a
series of small chips of rock that are then bagged and sent in for analysis.
This is a quicker and cheaper method of drilling, but does not give as much
information about the underlying rocks.
Scoping Study.
A detailed
study of the various possible methods to mine a deposit.
Sedimentation.
The process of
deposition of a solid material from a state of suspension or solution in a fluid
(usually air or water).
Silicic dome.
A convex
landform created by extruding quartz-rich volcanic rocks
Stope(s)
, An excavation from
which ore has been removed from sub-vertical openings above or below
levels.
Tertiary.
That portion of
geologic time that includes abundant volcanism in the western U.S.
Trenching.
A cost effective
way of examining the structure and nature of mineral ores beneath gravel cover.
It involves digging long usually shallow trenches in carefully selected areas to
expose unweathered rock and allow sampling.
Tuffaceous.
Pertaining to
sediments which contain up to 50% tuff.
Volcanic center.
Origin of
major volcanic activity
Volcanoclastic.
Coarse,
unsorted sedimentary rock formed from erosion of volcanic debris.
4
Forward-Looking
Statements
This
Annual Report on Form 10-K contains forward-looking information.
Forward-looking information includes statements relating to future actions,
prospective products, future performance or results of current or anticipated
products, sales and marketing efforts, costs and expenses, interest rates,
outcome of contingencies, financial condition, results of operations, liquidity,
business strategies, cost savings, objectives of management of Ranger Gold Corp.
(the “Company”, “Ranger”, or “we”) and other matters. Forward-looking
information may be included in this Annual Report on Form 10-K or may be
incorporated by reference from other documents filed with the Securities and
Exchange Commission (the “SEC”) by the Company. One can find many of these
statements by looking for words including, for example, “believes,” “expects,”
“anticipates,” “estimates” or similar expressions in this Annual Report on
Form 10-K or in documents incorporated by reference in this Annual Report
on Form 10-K. The Company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new information or
future events.
The
Company has based the forward-looking statements relating to the Company’s
operations on management’s current expectations, estimates and projections about
the Company and the industry in which it operates. These statements are not
guarantees of future performance and involve risks, uncertainties and
assumptions that we cannot predict. In particular, we have based many of these
forward-looking statements on assumptions about future events that may prove to
be inaccurate. Accordingly, the Company’s actual results may differ materially
from those contemplated by these forward-looking statements. Any differences
could result from a variety of factors, including, but not limited to general
economic and business conditions, competition, and other factors.
5
We are
engaged in natural resource exploration and anticipate acquiring, exploring, and
if warranted and feasible, developing natural resource properties. Currently we
are in the exploration state and are undertaking two exploration programs in
Nevada.
History
Ranger
Gold Corp. (formerly Fenario, Inc.) (the “Company”) was incorporated on May 11,
2007 under the laws of the State of Nevada. The Company’s business at
that time was the development and licensing of proprietary software solutions
for healthcare providers, health care professionals and health insurance
companies. Due to the state of the economy, the Company did not
conduct any significant operations other than organizational matters, filing its
Registration Statement and filings of periodic reports with the SEC. The Company
has since abandoned its original business plan and has entered the mineral
exploration industry.
On May
11, 2007, we issued an aggregate of 25,000,000 shares of our common stock to
Uziel Leibowitz, our former President, Chief Executive Officer, Chairman, and
Director. The shares were issued in consideration for the payment of
$500.
In
January 2008, we issued 20,000,000 shares of common stock to 40 investors at a
purchase price of $.002 per share for gross proceeds of $40,000, in a private
placement relying on the exemption from the registration requirements of the
Securities Act provided by Regulation S and/or Section 4(2) of the Securities
Act. Each purchaser represented to us that such purchaser was not a
United States person (as defined in Regulation S) and was not acquiring the
shares for the account or benefit of a United States person. Each purchaser
further represented that at the time of the origination of contact concerning
the subscription for the shares and the date of the execution and delivery of
the subscription agreement for such shares, such purchaser was outside of the
United States. We did not make any offers in the United States, and there were
no selling efforts in the United States. There were no underwriters or
broker-dealers involved in the private placement and no underwriting discounts
or commissions were paid.
On June
20, 2008, the Company commenced an offering of up to 15,000,000 shares of common
stock, $0.01 per share, pursuant to the prospectus contained in the Registration
Statement on Form S-1, filed with the Securities and Exchange Commission on June
4, 2008, and declared effective on June 19, 2008 (file number
333-151419). On July 23, 2008, the Company closed the offering prior
to the offering termination date because it had not been successful at selling
any shares in the offering as of said date.
On
October 28, 2009 the Company’s principal shareholder entered into a Stock
Purchase Agreement which provided for the sale of 25,000,000 shares of common
stock of the Company to Gary Basrai. Effective as of October 28,
2009, in connection with the share acquisition, Mr. Basrai was appointed
President, Chief Executive Officer, Chief Financial Officer, Treasurer,
Director, and Chairman of the Company.
On
November 6, 2009 Paul Strobel was elected to the Board of Directors of the
Company.
6
On
November 9, 2009, Mr. Basrai, as the holder of 25,000,000 (at that time
representing 55.5%) of the issued and outstanding shares of the Company’s common
stock, provided the Company with written consent in lieu of a meeting of
stockholders (the “Written Consent”) authorizing the Company to amend the
Company’s Articles of Incorporation for the purpose of changing the name of the
Company from “Fenario, Inc.” to “Ranger Gold Corp.” In connection
with the change of the Company’s name to Ranger Gold Corp. the Company’s
business was changed to mineral resource exploration. The change in
name and business received its final approval by the regulatory authorities on
January 7, 2010.
Also on
November 9, 2009 as part of the Written Consent and in relation to the Company’s
name and business change, the Written Consent adopted a resolution to implement
a forward stock split the Company’s issued and outstanding shares of common
stock. The Board of Directors subsequently approved a 5:1 forward
stock split which became effective on January 21, 2010 and was payable to all
shareholders of record as of January 15, 2010, the record date. All
references to share and per share amounts have been restated in this 10-K and
related financial statements to reflect the forward stock split.
On
November 27, 2009 the Company executed a property option agreement with
MinQuest, Inc. (“MinQuest”) granting the Company the right to acquire 100% of
the mining interests of a mineral exploration property currently controlled by
MinQuest. The property known as the CX Property is located in Nye
County, Nevada and currently consists of 72 unpatented claims.
On
January 25, 2010 the Company completed a private placement issuing 550,000 units
at $0.15 per unit for total proceeds of $82,500. The units were
offered by the Company pursuant to an exemption from registration under
Regulation S of the Securities Act of 1933, as amended. Each unit
consists of one common share of the Company and two non-transferable share
purchase warrants, designated Class A and Class B. The Class A
warrants are exercisable at a price of $0.25 per share and the Class B warrants
are exercisable at a price of $0.50 per share. The Class A warrants
are exercisable commencing January 25, 2011 and the Class B warrants are
exercisable commencing January 25, 2012. Both the Class A and Class B
warrants expire on January 25, 2015.
On
February 3, 2010 the Company adopted its 2010 Stock Option Plan (the “2010
Plan”). The 2010 Plan provides for the granting of up to 5,000,000
stock options to key employees, directors and consultants, of common shares of
the Company.
On March
10, 2010 the Company closed a private placement of 70,000 common shares at $0.15
per share for a total offering price of $10,500. The shares were
offered by the Company pursuant to an exemption from registration under
Regulation S of the Securities Act of 1933, as amended.
On March
16, 2010 Shelby Cave was elected to the Board of Directors of the
Company.
On March
29, 2010, the Company executed a second property option agreement with MinQuest
granting the Company the right to acquire 100% of the mining interests of a
Nevada mineral exploration property currently controlled by
MinQuest. The property known as the Truman Property is located in
Mineral County, Nevada and currently consists of 52 unpatented
claims.
7
On April
20, 2010, the Company completed a private placement of 400,000 common shares at
$1.25 per share for a total offering price of $500,000. The shares were offered
by the Company pursuant to an exemption from registration under Regulation S of
the Securities Act of 1933, as amended.
Business
Operations
We are a
natural resource exploration company with an objective of acquiring, exploring,
and if warranted and feasible, developing natural resource properties. Our
primary focus in the natural resource sector is gold. We are an exploration
state company. We do not consider ourselves a “blank check” company required to
comply with Rule 419 of the Securities and Exchange Commission, because we were
not organized for the purpose of effecting, and our business plan is not to
effect, a merger with or acquisition of an unidentified company or companies, or
other entity or person. We do not intend to merge with or acquire another
company in the next 12 months.
Though we
have the expertise on our board of directors to take a resource property that
hosts a viable ore deposit into mining production, the costs and time frame for
doing so are considerable, and the subsequent return on investment for our
shareholders would be very long term. Therefore, we anticipate selling or
partnering any ore bodies that we may discover to a major mining company. Many
major mining companies obtain their ore reserves through the purchase of ore
bodies found by junior exploration companies. Although these major mining
companies do some exploration work themselves, many of them rely on the junior
resource exploration companies to provide them with future deposits for them to
mine. By selling or partnering a deposit found by us to these major mining
companies, it would provide an immediate return to our shareholders without the
long time frame and cost of putting a mine into operation ourselves, and it
would also provide future capital for the Company to continue
operations.
The
search for valuable natural resources as a business is extremely risky. We can
provide investors with no assurance that the properties we have optioned in
Nevada contain commercially exploitable reserves. Exploration for natural
reserves is a speculative venture involving substantial risk. Few properties
that are explored are ultimately developed into producing commercially feasible
reserves. 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 and
any money spent on exploration would be lost.
8
Natural
resource exploration and development requires significant capital and our assets
and resources are limited. Therefore, we anticipate participating in the natural
resource industry through the selling or partnering of our properties, the
purchase of small interests in producing properties, the purchase of properties
where feasibility studies already exist or by the optioning of natural resource
exploration and development projects. To date we have two properties under
option, and are in the early stages of exploring these properties. There has
been no indication as yet that any commercially viable mineral deposits exist on
these properties, and there is no assurance that a commercially viable mineral
deposit exists on any of our properties. Further exploration will be required
before a final evaluation as to the economic and legal feasibility is
determined.
Financing
On
January 25, 2010 the Company completed a private placement issuing 550,000 units
at $0.15 per unit for total proceeds of $82,500. Each unit consists
of one common share of the Company and two non-transferable share purchase
warrants, designated Class A and Class B. The Class A warrants are
exercisable at a price of $0.25 per share and the Class B warrants are
exercisable at a price of $0.50 per share. The Class A warrants are
exercisable commencing January 25, 2011 and the Class B warrants are exercisable
commencing January 25, 2012. Both the Class A and Class B warrants
expire on January 25, 2015.
On March
10, 2010 the Company closed a private placement of 70,000 common shares at $0.15
per share for a total offering price of $10,500 and on April 20, 2010, the
Company completed a private placement of 400,000 common shares at $1.25 per
share for a total offering price of $500,000.
The
shares or units from these financings were offered by the Company pursuant to an
exemption from registration under Regulation S of the Securities Act of 1933, as
amended.
With the
funds currently held by the Company, we are adequately funded for all work
programs and option commitments for the next 12 months. If we were to develop
any of our properties beyond the exploration activities currently being
undertaken by the Company, we would need to raise further funding. If
additional funding is required, management plans to seek the additional capital
through private placements and public offerings of its common stock but there
can be no assurances that management would be successful in its attempt to raise
the additional funds.
Competition
The
mineral exploration industry, in general, is intensively competitive and even if
commercial quantities of ore are discovered, a ready market may not exist for
sale of same. Numerous factors beyond our control may affect the marketability
of any substances discovered. These factors include market fluctuations, the
proximity and capacity of natural resource markets and processing equipment,
government regulations, including regulations relating to prices, taxes,
royalties, land tenure, land use, importing and exporting of minerals and
environmental protection. The exact effect of these factors cannot be accurately
predicted, but the combination of these factors may result in our not receiving
an adequate return on invested capital.
9
Government
Regulation
The
federal government and various state and local governments have adopted laws and
regulations regarding the protection of natural resources, human health and the
environment. We will be required to conduct all exploration activities in
accordance with all applicable laws and regulations. These may include requiring
working permits for any exploration work that results in physical disturbances
to the land and locating claims, posting claims and reporting work performed on
the mineral claims. The laws and regulations may tell us how and where we can
explore for natural resources, as well as environmental matters relating to
exploration and development. Because these laws and regulations change
frequently, the costs of compliance with existing and future environmental
regulations cannot be predicted with certainty.
Any
exploration or production on United States Federal land will have to comply with
the Federal Land Management Planning Act which has the effect generally of
protecting the environment. Any exploration or production on private property,
whether owned or leased, will have to comply with the Endangered Species Act and
the Clean Water Act. The cost of complying with environmental concerns under any
of these acts varies on a case-by-case basis. In many instances the cost can be
prohibitive to development. Environmental costs associated with a particular
project must be factored into the overall cost evaluation of whether to proceed
with the project.
Other
than the normal bonding requirements, there are no costs to us at the present
time in connection with compliance with environmental laws. However, since we do
anticipate engaging in natural resource projects, these costs could occur at any
time. Costs could extend into the millions of dollars for which we could be
liable. In the event of liability, we would be entitled to contribution from
other owners so that our percentage share of a particular project would be the
percentage share of our liability on that project. However, other owners may not
be willing or able to share in the cost of the liability. Even if liability is
limited to our percentage share, any significant liability would wipe out our
assets and resources.
Employees
We have
commenced only limited operations. Therefore, we have no full time employees.
Our sole officer and three directors provide planning and organizational
services for us on a part-time basis.
Subsidiaries
We do not
have any subsidiaries and we are not part of a group.
Factors that May Affect
Future Results
1.
We will require additional funds in the future to achieve our current business
strategy and our inability to obtain funding will cause our business to
fail.
10
Based
upon current plans we expect to incur operating losses in future periods. This
will happen because there are expenses associated with the acquisition and
exploration of natural resource properties. While we have sufficient cash on
hand to fund our operating needs to March 31, 2011, we will need to raise
additional funds in the future through public or private debt or equity sales in
order to fund our future operations and fulfill contractual obligations. These
financings may not be available when needed. Even if these financings are
available, it may be on terms that we deem unacceptable or are materially
adverse to your interests with respect to dilution of book value, dividend
preferences, liquidation preferences, or other terms. Our inability to obtain
financing would have an adverse effect on our ability to implement our current
exploration in Arizona and Nevada, and as a result, could require us to diminish
or suspend our operations and possibly cease our existence. Obtaining additional
financing would be subject to a number of factors, including the market prices
for the mineral property and silver and copper. These factors may make the
timing, amount, terms or conditions of additional financing unavailable to
us.
2.
If we do not complete the required option payments and capital expenditure
requirements mandated in our respective agreements with MinQuest, Inc.
(“MinQuest”) we will lose our interest in that respective property and our
business may fail.
If we do
not make all of the property payments to MinQuest or incur the required
expenditures in accordance with the respective property option agreements we
will lose our option to acquire the respective property for which we have not
made the payments and may not be able to continue to execute our business
objectives if we are unable to find an alternate exploration interest. Since our
payment obligations are non-refundable, if we do not make any payments, we will
lose any payments previously made and all our rights to the
properties.
3.
Because of our reliance on MinQuest our operations would be severely impacted
should our relationship with MinQuest be terminated for any reason.
Both of
our properties have been acquired from MinQuest. In addition, to date
all of our exploration activity on these properties has been undertaken by
MinQuest. As a result, MinQuest has significant knowledge about our
properties and it would be very difficult for us to replace MinQuest should our
relationship with them be terminated for any reason. To date, there
have not been any conflicts between the Company and MinQuest.
11
4.
Because our Officer and Directors serve as Officers and Directors of other
companies engaged in mineral exploration, a potential conflict of interest could
negatively impact our ability to acquire properties to explore and to run our
business.
All of
our Directors and Officers work for other mining and mineral exploration
companies. Due to time demands placed on our Directors and Officers,
and due to the competitive nature of the exploration business, the potential
exists for conflicts of interest to occur from time to time that could adversely
affect our ability to conduct our business. The Officers and Directors’
full-time employment with other entities limits the amount of time they can
dedicate to us as a director or officer. Also, our Directors and Officers may
have a conflict of interest in helping us identify and obtain the rights to
mineral properties because they may also be considering the same properties. To
mitigate these risks, we work with several geologists in order to ensure that we
are not overly reliant on any one of our Directors to provide us with geological
services. However, we cannot be certain that a conflict of interest
will not arise in the future. To date, there have not been any
conflicts of interest between any of our Directors or Officers and the
Company.
5.
Because of the speculative nature of exploration and development, there is a
substantial risk that our business will fail.
The
search for valuable natural resources as a business is extremely risky. We can
provide investors with no assurance that the properties we have in Arizona and
Nevada contain commercially exploitable reserves. Exploration for natural
reserves is a speculative venture involving substantial risk. Few properties
that are explored are ultimately developed into producing commercially feasible
reserves. 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.
6.
Because we have not commenced business operations, we face a high risk of
business failure due to our inability to predict the success of our
business
We are in
the initial stages of exploration of our mineral claims and thus have no way to
evaluate the likelihood that we will be able to operate our business
successfully. To date have been involved primarily in organizational activities,
and the acquisition and exploration of the mineral claims. We have not earned
any revenues as of the date of this report.
7.
Because of the unique difficulties and uncertainties inherent in mineral
exploration and the mining business, we face a high risk of business
failure
Potential
investors should be aware of the difficulties normally encountered by
early-stage mineral exploration companies and the high rate of failure of such
enterprises. 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. These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates.
12
In
addition, the search for valuable minerals involves numerous hazards. As a
result, we may become subject to liability for such hazards, including
pollution, cave-ins and other hazards against which we cannot insure or against
which we may elect not to insure. The payment of such liabilities may have a
material adverse effect on our financial position.
8.
Because we anticipate our operating expenses will increase prior to our earning
revenues, we may never achieve profitability
Prior to
completion of our exploration stage, we anticipate that we will incur increased
operating expenses without realizing any revenues. Therefore, we expect to incur
significant losses into the foreseeable future. We recognize that if we are
unable to generate significant revenues from the exploration of our mineral
claims we will not be able to earn profits or continue operations. There is no
history upon which to base any assumption as to the likelihood that we will
prove successful, and we can provide investors with no assurance that we will
generate any operating revenues or ever achieve profitable operations. If we are
unsuccessful in addressing these risks, our business will most likely
fail.
9.
Because access to our mineral claims may be restricted by inclement weather we
may be delayed in our exploration
Access to
our mineral properties may be restricted through some of the year due to weather
in the
local
area. As a result, any attempt to test or explore the property is largely
limited to the times when weather permits such activities. These limitations can
result in significant delays in exploration efforts. Such delays can have a
significant negative effect on our results of operations.
10.
Because our President has only agreed to provide his services on a part-time
basis, he may not be able or willing to devote a sufficient amount of time to
our business operations, causing our business to fail
Mr.
Basrai, our sole officer, owns and operates several businesses. As a
result of his duties and responsibilities with the other businesses Mr. Basrai
provides his management services to a number of companies. Because we are in the
early stages of our business, Mr. Basrai will not be spending all of his
time working for the Company. Mr. Basrai will expend enough time to oversee
the work programs that have been approved by the Company. Later, if
the demands of our business require additional time from Mr. Basrai, he is
prepared to adjust his timetable to devote more time to our business. However,
it still may not be possible for Mr. Basrai to devote sufficient time to
the management of our business, as and when needed, especially if the demands of
Mr. Basrai’s other interests increase. Competing demands on
Mr. Basrai’s time may lead to a divergence between his interests and the
interests of our shareholders.
13
Risks Related To Legal
Uncertainty and Regulations
11.
As we undertake exploration of our mineral claims, we will be subject to
compliance with government regulation that may increase the anticipated cost of
our exploration programs
There are
several governmental regulations that materially restrict mineral exploration.
We will be subject to the federal, state and local laws of the United States and
Nevada as we carry out our exploration programs. We may be required to obtain
work permits, post bonds and perform remediation work for any physical
disturbance to the land in order to comply with these laws. While our planned
exploration program budgets for regulatory compliance, there is a risk that new
regulations could increase our costs of doing business and prevent us from
carrying out our exploration programs.
|
12.
|
Our
auditors’ opinion on our March 31, 2010 and 2009 financial statements
includes an explanatory paragraph in respect of there being substantial
doubt about our ability to continue as a going
concern.
|
We have
incurred net losses of $244,733 from May 11, 2007 (inception) to March 31,
2010. Our financial statements do not include any adjustments
relating to the recoverability and classification of recorded assets, or the
amounts of and classification of liabilities that might be necessary in the
event the Company cannot continue in existence. We anticipate
generating losses for at least the next 12 months. Therefore, there
is substantial doubt about our ability to continue operations in the future as a
going concern. We will need to obtain additional funds in the
future. Our plans to deal with this cash requirement include loans
from existing shareholders, raising additional capital from the public or
private sale of equity or entering into a strategic arrangement with a third
party. If we cannot continue as a viable entity, our shareholders may
lose some or all of their investment in our company.
There are
no unresolved staff comments.
We do not
lease or own any real property. We currently maintain our corporate office on a
one-year lease basis at 2533 N. Carson Street, Carson City, Suite 5018, Carson
City, Nevada, 89706. Management believes that our office space is
suitable for our current needs.
14
In the
following discussion relating to our interests in real property, there are
references to “patented” mining claims and “unpatented” mining claims. A
patented mining claim is one for which the U.S. government has passed its title
to the claimant, giving that person title to the land as well as the minerals
and other resources above and below the surface. The patented claim is then
treated like any other private land and is subject to local property taxes. An
unpatented mining claim on U.S. government lands establishes a claim to the
locatable minerals (also referred to as stakeable minerals) on the land and the
right of possession solely for mining purposes. No title to the land passes to
the claimant. If a proven economic mineral deposit is developed, provisions of
federal mining laws permit owners of unpatented mining claims to patent (to
obtain title to) the claim. If one purchases an unpatented mining claim that is
later declared invalid by the U.S. government, one could be
evicted.
15
Map of
our CX and Truman Properties located in Nevada.
16
CX
Property
Acquisition of
Interest
Pursuant
to a Property Option Agreement, dated as of November 27, 2009 the Company
executed a property option agreement with MinQuest, Inc. (“MinQuest”) granting
the Company the right to acquire 100% of the mining interests of a mineral
exploration property currently controlled by MinQuest. The property
known as the CX Property is located in Nye County, Nevada and currently consists
of 72 unpatented claims (the ‘CX”). Annual option payments and
minimum annual exploration expenditures are as noted below:
|
Property
|
Work
|
|||
|
Payments
|
Expenditures
|
|||
|
Upon
Execution of the Agreement
|
$
|
-
|
$
|
-
|
|
By
February 25, 2010
|
20,000
|
-
|
||
|
By
February 25, 2011
|
20,000
|
50,000
|
||
|
By
February 25, 2012
|
20,000
|
150,000
|
||
|
By
February 25, 2013
|
30,000
|
200,000
|
||
|
By
February 25, 2014
|
40,000
|
350,000
|
||
|
By
February 25, 2015
|
50,000
|
200,000
|
||
|
By
February 25, 2016
|
50,000
|
200,000
|
||
|
By
February 25, 2017
|
50,000
|
200,000
|
||
|
By
February 25, 2018
|
50,000
|
200,000
|
||
|
By
February 25, 2019
|
50,000
|
200,000
|
||
|
By
February 25, 2020
|
100,000
|
750,000
|
||
|
$
|
480,000
|
$
|
2,500,000
|
|
Upon
execution of the CX agreement, MinQuest accepted a 90-day, non-interest bearing
promissory note from the Company for the initial $20,000 property option
payment. On February 25, 2010 the Company paid the $20,000 balance of
the note as well as reimbursed MinQuest for CX’s holding and related property
costs in the amount of $23,512.
Description
and Location of the CX Property
The CX
Property is located in Nye County, Nevada, 80 km north of Tonopah and currently
consists of 72 unpatented claims.
Exploration
History of the CX Property
Between
1970 and 1989, approximately 100 holes were drilled on the CX
Property. Over 70 of these holes tested the main resource area while
the rest tested the three remaining targets. Drill testing has been relatively
shallow, with only 8 holes known to be deeper than 800 feet (240m) all located
within the resource area.
17
Since
1989 work on the project has been limited to geologic mapping, rock chip
sampling, geophysical surveys and reinterpretation of
targets. Fieldwork by various groups identified mineralization with
variable Ag:Au ratios. The rock-chip sampling confirmed the presence
of gold mineralization with a low Ag:Au ratio peripheral to the known resource
area. Previous limited shallow drilling in these two areas
intersected gold mineralization. This Au-rich facies contains higher
arsenic, antimony and mercury suggesting a separate gold mineralizing
event.
A
3-dimensional drill model of the resource was reportedly completed by Bullion
River Gold in 2004. The model suggests that gold-silver
mineralization remains open along strike and at depth of the resource
area.
Geology
of the CX Property
The CX
lies within a clustered group of calderas considered part of the Jefferson
Mountain Caldera system. The project area is underlain by a Middle
Tertiary (22-26Ma) caldera complex consisting of felsic ash-flow tuffs,
tuffaceous sediments, and intrusions. The property lies along the margin of one
of several nested calderas. Widespread alteration and mineralization coincides
with a district-scale, northeast-trending structural zone coinciding with a
caldera margin.
The CX is
a volcanic-hosted, low-sulfidation, silver-gold, and epithermal system extending
for more than 5.5 km along a northeast-trending structural zone defined by
alteration, veining, gold-silver mineralization, faulting, and intrusions.
Mineralization occurs in quartz-vein stockworks and breccias within sericitized,
argillized and silicified volcanic rocks. Arsenic, molybdenum, mercury,
thallium, and antimony are strongly elevated with gold and
silver. Base-metal contents are low throughout the area. Strongly
sericitized, alkali rhyolite stocks with quartz veinlets containing
gold-silver-molybdenum mineralization are the likely source of
mineralization.
Current
State of Exploration
The CX
claims presently do not have any mineral resources or reserves. The company has
reviewed the results of the historic drilling and sampling. There is
no mining plant or equipment located within the property boundaries. Currently,
there is no power supply to the mineral claims. Our planned program includes
compilation of all activities to the present with a follow-up reverse
circulation drill program. However, this program is exploratory in
nature and no minable reserves may ever be found.
18
Geological
Exploration Program
In April
2010 our Board of Directors approved a $150,000 exploration program that will
include 3,000 feet of reverse circulation drilling. Previous
exploration mainly focused on a small core area where numerous drill holes were
concentrated. The core area occurs near the center of the claim
block. The outlying targets were tested with wide spaced, shallow
drill holes. Some of the targets had two episodes of drilling, both
confirming the existence of significant gold and silver mineralization over
substantial widths. These outlying targets were poorly understood,
but remain attractive targets. Subsequent drilling added to the
understanding of the model through detailed mapping, sampling and a geophysical
survey. However, the program was prematurely truncated due to budget
cuts. The various targets were further defined, but never tested by
drilling.
Ranger
has collected all of the data from the previous programs and intends to confirm
the validity of the targets, prioritize the best two and test them with a drill
program.
Truman
Property
Acquisition of
Interest
Pursuant
to a Property Option Agreement dated March 29, 2010, the Company executed a
second property option agreement with MinQuest granting the Company the right to
acquire 100% of the mining interests of a Nevada mineral exploration property
currently controlled by MinQuest. The property known as the Truman
Property is located in Mineral County, Nevada and currently consists of 52
unpatented claims (the “Truman”). Annual option payments and minimum
annual exploration expenditures are as noted below:
|
Property
|
Work
|
|||
|
Payments
|
Expenditures
|
|||
|
Upon
Execution of the Agreement
|
$
|
10,000
|
$
|
-
|
|
By
March 29, 2011
|
10,000
|
50,000
|
||
|
By
March 29, 2012
|
20,000
|
150,000
|
||
|
By
March 29, 2013
|
30,000
|
200,000
|
||
|
By
March 29, 2014
|
40,000
|
350,000
|
||
|
By
March 29, 2015
|
50,000
|
200,000
|
||
|
By
March 29, 2016
|
50,000
|
200,000
|
||
|
By
March 29, 2017
|
50,000
|
200,000
|
||
|
By
March 29, 2018
|
50,000
|
200,000
|
||
|
By
March 29, 2019
|
50,000
|
200,000
|
||
|
By
March 29, 2020
|
150,000
|
750,000
|
||
|
$
|
510,000
|
$
|
2,500,000
|
|
19
Upon
execution of the Agreement the Company paid MinQuest $10,000 and well as
reimbursed MinQuest for Truman’s holdings and related property costs in the
amount of $7,859.
Description
and Location of the Truman Property
The
Truman Property is located within the Buena Vista Mining District in
southwestern Mineral County, Nevada, USA approximately 161 kilometers west of
Tonopah, Nevada and 72.4 kilometers north-northeast of Bishop, California and
currently consists of 52 unpatented claims.
Exploration
History of the Truman Property
The
project covers 8 epithermal gold and silver targets hosted within a sequence of
Tertiary volcanics and Paleozoic sediments. These targets have been
partially defined by previous exploration groups over a 25 year
period. The historic efforts of five exploration groups have helped
define high grade gold and silver values occurring in veins and low grade gold
values occurring in bulk minable configurations.
Geology
of the Truman Mineral Claims
The
project covers 8 epithermal gold and silver targets hosted within a sequence of
Tertiary volcanics and Paleozoic sediments. Regionally the Truman Property is
located at the southwestern end of the Mina deflection within and adjacent to
the Coaldale Fault Zone. To the south the White Mountains are made up
of quartz monzonite of the Inyo Batholith containing roof pendants of highly
metamorphosed Cambrian to Ordovician sediments. The east and north
flanks of the White Mountains are composed predominantly of welded and
non-welded ash flows, andesitic flows and breccias, quartz latite, basalt and
tuffaceous volcanoclastics and sediments.
The
Cambrian Polleta Formation, a coarse grained marble to recrystallized limestone,
is the oldest formation known in the area. The thickness within the
project area is at least 320 meters. The Harkless Formation lies
conformably above the Polleta Formation. The Harkless is composed of
a red to brown phyllite which produces slaty to pencil like shards when
weathered. The Harkless ranges from 30 to 100 meters
thick.
The
Cambrian formations are intruded by a group of felsic to intermediate stocks
ranging from Jurassic to Miocene (Crowder, et al, 1972). A possible
Jurassic age adamellite is mapped in sections 2 and 3. Mineralization
peripheral to the intrusive bodies include quartz-calcite vein fillings within
faults containing gold and silver. A luecogranite near the center
boundary of sections 10 and 11 is fault bounded and difficult to determine the
relationships with either the ash fall tuffs or the Paleozoic
sediments. A porphyrytic rhyolite stock occurring along the range
front adjacent to the Pediment Target in the central part of section 11 is
believed to be Tertiary in age (Crowder, et al, 1972). The
porphyrytic rhyolite has been altered to a quartz-sericite-pyrite matrix with
stockwork quartz veining along the north and east margins. Contact
type alteration and mineralization are exposed in several areas around the stock
in Section 11. At least three distinct dike generations cut the
Paleozoic, intrusive and volcanic country rocks. These dikes are
intermediate to basic ranging from andesitic to diabase in nature.
20
Current
State of Exploration
The
Truman claims presently do not have any mineral resources or reserves. The
property that is the subject of our mineral claims is undeveloped and does not
contain any open-pits. No reported historic production is noted for
the property. There is no mining plant or equipment located on the
property that is the subject of the mineral claim. Currently, there is no power
supply to the mineral claims. Our planned exploration program is exploratory in
nature and no mineral reserves may ever be found. Although drill
holes are present within the property boundary, there is no drilled resource on
our claims.
Geological
Exploration Program
In April
2010 our Board of Directors approved a $150,000 exploration program that will
include 3,000 feet of reverse circulation drilling. The project
covers 8 epithermal gold and silver targets hosted within a sequence of Tertiary
volcanics and Paleozoic sediments. These targets have been partially
defined by previous exploration groups over a 25 year period. The
historic efforts of five exploration groups have helped define high grade gold
and silver values occurring in veins and low grade gold values occurring in bulk
minable configurations.
The
company intends to concentrate on three previously identified mineralized
zones. Although the various targets were previously discovered by
others, they remain poorly explored because of past property disputes or a lack
of understanding of the geology and an ore model. Recent
breakthroughs in geologic concepts in the immediate area and ore models typified
by the aforementioned targets coupled with the historic results collected from
others work provides an excellent opportunity for Ranger to take advantage
of.
Ranger
intends to confirm its geologic theory through mapping of the target areas,
defining the targets with additional sampling and then drilling.
There are
no pending legal proceedings to which the Company is a party or in which any
director, officer or affiliate of the Company, any owner of record or
beneficially of more than 5% of any class of voting securities of the Company,
or security holder is a party adverse to the Company or has a material interest
adverse to the Company. The Company’s properties are not the subject
of any pending legal proceedings.
21
PART
II
Matters, and Issuer Purchases of Equity
Securities.
Market
Information
.
Our
common stock is traded on the Financial Industry Regulatory Authority Over The
Counter Bulletin Board (“OTCBB”) under the symbol “RNGC.” The OTCBB does not
have any quantitative or qualitative standards such as those required for
companies listed on Nasdaq. The following table sets forth the range
of quarterly high and low closing bid prices of the common stock as reported on
http://finance.yahoo.com during the years ending March 31, 2010 and March 31,
2009:
|
Financial Quarter
|
Bid Price Information
*
|
||
|
Year
|
Quarter
|
High Bid Price
|
Low Bid Price
|
|
2010
|
Fourth
Quarter
|
$1.10
|
$0.15
|
|
Third
Quarter
|
$0.03
|
$0.03
|
|
|
Second
Quarter
|
$0.03
|
$0.03
|
|
|
First
Quarter
|
$0.03
|
$0.03
|
|
|
2009
|
Fourth
Quarter
|
$0.03
|
$0.03
|
|
Third
Quarter
|
$0.03
|
$0.03
|
|
|
Second
Quarter
|
$-
|
$-
|
|
|
First
Quarter
|
$-
|
$-
|
|
*The
quotations reflect inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions.
Holders
.
On June
22, 2010, there were approximately thirty-one (31) holders of record of the
Company’s common stock.
Dividends
.
The
Company has not declared or paid any cash dividends on its common stock nor does
it anticipate paying any in the foreseeable future. Furthermore, the Company
expects to retain any future earnings to finance its operations and expansion.
The payment of cash dividends in the future will be at the discretion of its
Board of Directors and will depend upon its earnings levels, capital
requirements, any restrictive loan covenants and other factors the Board
considers relevant.
Warrants or
Options
.
At March
31, 2010 the Company had 1,400,000 (2009 – nil) common stock options and
1,100,000 (2009 – nil) outstanding. Each common stock option and
warrant is convertible into one share of common stock of the
Company.
22
Securities Authorized for
Issuance under Equity Compensation Plans
We do not
have any equity compensation plans that were approved by our shareholders. Set
forth below is certain information as of March 31, 2010, the end of our most
recently completed fiscal year, regarding equity compensation plans that have
not been approved by our stockholders.
|
Equity
compensation plans not approved by stockholders – as of March 31,
2010
|
||||||||
|
Plan
Category
|
Number
of securities to be
issued
upon exercise of
outstanding
options, warrants and rights
|
Weighted
average exercise
price
of outstanding options,
warrants
and rights
|
Number
of securities
remaining
available for
future
issuance
|
|||||
|
2010
Stock Option Plan
|
5,000,000
|
$0.68
|
3,600,000
|
|||||
|
Share
Purchase Warrants
|
1,100,000
|
$0.38
|
N/A
|
|||||
As of
March 31, 2010, there were a total of 1,400,000 options granted under the 2010
Plan with exercise prices ranging from $0.50 per share to $1.00 per
share.
The
following discussion describes material terms of grants made pursuant to the
stock option plans:
On
February 3, 2010 the Company adopted its 2010 Stock Option Plan (“the 2010
Plan”). The 2010 Plan provides for the granting of up to 5,000,000
stock options to key employees, directors and consultants, of common shares of
the Company. Under the 2010 Plan, the granting of stock options, the
exercise prices, and the option terms are determined by the Company's Option
Committee, a committee designated to administer the 2010 Plan by the Board of
Directors. For incentive options, the exercise price shall not be
less than the fair market value of the Company's common stock on the grant date.
(In the case of options granted to an employee who owns stock possessing more
than 10% of the voting power of all classes of the Company's stock on the date
of grant, the option price must not be less than 110% of the fair market value
of common stock on the grant date.). Options granted are not to
exceed terms beyond five years. No stock options have been granted
under the 2010 Plan.
In order
to exercise an option granted under the Plan, the optionee must pay the full
exercise price of the shares being purchased. Payment may be made either: (i) in
cash; or (ii) at the discretion of the Committee, by delivering shares of common
stock already owned by the optionee that have a fair market value equal to the
applicable exercise price; or (iii) with the approval of the Committee, with
monies borrowed from us.
23
Subject
to the foregoing, the Committee has broad discretion to describe the terms and
conditions applicable to options granted under the Plan. The Committee may at
any time discontinue granting options under the Plan or otherwise suspend, amend
or terminate the Plan and may, with the consent of an optionee, make such
modification of the terms and conditions of such optionee’s option as the
Committee shall deem advisable.
Recent Sales of Unregistered
Securities; Use of Proceeds from Registered Securities.
On
January 25, 2010 the Company completed a private placement issuing 550,000 units
at $0.15 per unit for total proceeds of $82,500. Each unit consists
of one common share of the Company and two non-transferable share purchase
warrants, designated Class A and Class B. The Class A warrants are
exercisable at a price of $0.25 per share and the Class B warrants are
exercisable at a price of $0.50 per share. The Class A warrants are
exercisable commencing January 25, 2011 and the Class B warrants are exercisable
commencing January 25, 2012. Both the Class A and Class B warrants
expire on January 25, 2015.
On March
10, 2010 the Company closed a private placement of 70,000 common shares at $0.15
per share for a total offering price of $10,500.
On April
20, 2010, the Company completed a private placement of 400,000 common shares at
$1.25 per share for a total offering price of $500,000.
All of
the above transactions were offered by the Company pursuant to an exemption from
registration under Regulation S of the Securities Act of 1933, as
amended.
Purchases of Equity
Securities by the Company and Affiliated Purchasers.
None.
A smaller
reporting company, as defined by Item 10 of Regulation S-K, is not required to
provide the information required by this item.
Overview
We are a
natural resource exploration company with an objective of acquiring, exploring,
and if warranted and feasible, exploiting natural resource properties. Our
primary focus in the natural resource sector is gold. We do not consider
ourselves a “blank check” company required to comply with Rule 419 of the
Securities and Exchange Commission, because we were not organized for the
purpose of effecting, and our business plan is not to effect, a merger with or
acquisition of an unidentified company or companies, or other entity or person.
We do not intend to merge with or acquire another company in the next 12
months.
24
Though we
have the expertise on our board of directors to take a resource property that
hosts a viable ore deposit into mining production, the costs and time frame for
doing so are considerable, and the subsequent return on investment for our
shareholders would be very long term indeed. We therefore anticipate optioning
or selling any ore bodies that we may discover to a major mining company. Most
major mining companies obtain their ore reserves through the purchase of ore
bodies found by junior exploration companies. Although these major mining
companies do some exploration work themselves, many of them rely on the junior
resource exploration companies to provide them with future deposits for them to
mine. By optioning or selling a deposit found by us to these major mining
companies, it would provide an immediate return to our shareholders without the
long time frame and cost of putting a mine into operation ourselves, and it
would also provide future capital for the company to continue
operations.
The
search for valuable natural resources as a business is extremely risky. We can
provide investors with no assurance that the properties we have in Nevada
contain commercially exploitable reserves. Exploration for natural
reserves is a speculative venture involving substantial risk. Few properties
that are explored are ultimately developed into producing commercially feasible
reserves. Problems such as unusual or unexpected geological 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 and any money spent on exploration would be lost.
Natural
resource exploration and development requires significant capital and our assets
and resources are limited. Therefore, we anticipate participating in the natural
resource industry through the purchase or option of early stage
properties. To date we have two properties under option. We
have not yet conducted exploration on the properties but we have initiated an
exploration program that will include mapping, sampling, surveying and drilling
on each of our two properties. There has been no indication as yet that any
mineral deposits exist on the properties, and there is no assurance that a
commercially viable mineral deposit exists on our properties. Further
exploration will be required before a final evaluation as to the economic and
legal feasibility is determined.
In the
following discussion, there are references to “unpatented” mining claims. An
unpatented mining claim on U.S. government lands establishes a claim to the
locatable minerals (also referred to as stakeable minerals) on the land and the
right of possession solely for mining purposes. No title to the land passes to
the claimant. If a proven economic mineral deposit is developed, provisions of
federal mining laws permit owners of unpatented mining claims to patent (to
obtain title to) the claim. If you purchase an unpatented mining claim that is
later declared invalid by the U.S. government, you could be
evicted.
Plan of
Operation
During
the twelve-month period ending March 31, 2011, our objective is to continue to
explore the properties subject to our mineral claims. The funds in
our treasury are sufficient to meet all planned activities as outlined below,
with a contingency margin. As a result of this, we do not expect to enter into
any new financing arrangements during the twelve months ending March 31,
2011.
25
We
continue to run our operations with the use of contract operators, and as such
do not anticipate a change to our company staffing levels. We remain focused on
keeping the staff compliment, which currently consists of our three directors
and one investor relations person, at a minimum to conserve capital. Our
staffing in no way hinders our operations, as outsourcing of necessary
operations continues to be the most cost effective and efficient manner of
conducting the business of the Company.
We do not
anticipate any equipment purchases in the twelve months ending March 31,
2011.
The
following is an overview of the project work to date, as well as anticipated
work for the next twelve months. Specific dates when work will begin, and how
long it will take to complete each step is subject to change due to the
variables of weather, availability of work crews for a particular type of work,
and the results of work that is planned, the outcome of which will determine
what the next step on that project will be.
CX
Property
Pursuant
to a Property Option Agreement, dated as of November 27, 2009 the Company
executed a property option agreement with MinQuest, Inc. (“MinQuest”) granting
the Company the right to acquire 100% of the mining interests of a mineral
exploration property currently controlled by MinQuest. The property
known as the CX Property is located in Nye County, Nevada and currently consists
of 72 unpatented claims (the ‘CX”). To earn a 100% interest in the
CX, the Company must make certain annual option payments totaling $480,000 and
incur certain annual exploration expenditures totaling $2,500,000 to February
25, 2020. Upon execution of the CX agreement, MinQuest accepted a 90-day,
non-interest bearing promissory note from the Company for the initial $20,000
property option payment. On February 25, 2010 the Company paid the
$20,000 balance of the note as well as reimbursed MinQuest for CX’s holding and
related property costs in the amount of $23,512.
In April
2010 our Board of Directors approved a $150,000 exploration program that will
include 3,000 feet of reverse circulation drilling. Previous
exploration mainly focused on a small core area where numerous drill holes were
concentrated. The core area occurs near the center of the claim
block. The outlying targets were tested with wide spaced, shallow
drill holes. Some of the targets had two episodes of drilling, both
confirming the existence of significant gold and silver mineralization over
substantial widths. These outlying targets were poorly understood,
but remain attractive targets. Subsequent drilling added to the
understanding of the model through detailed mapping, sampling and a geophysical
survey. However, the program was prematurely truncated due to budget
cuts. The various targets were further defined, but never tested by
drilling.
Ranger
has collected all of the data from the previous programs and intends to confirm
the validity of the targets, prioritize the best two and test them with a drill
program.
26
Truman
Property
Pursuant
to a Property Option Agreement dated March 29, 2010, the Company executed a
second property option agreement with MinQuest granting the Company the right to
acquire 100% of the mining interests of a Nevada mineral exploration property
currently controlled by MinQuest. The property known as the Truman
Property is located in Mineral County, Nevada and currently consists of 52
unpatented claims (the “Truman”). To earn a 100% interest in the
Truman the Company must make certain annual option payments totaling $510,000
and incur certain annual exploration expenditures totaling $2,500,000 to March
29, 2020. Upon execution of the Agreement the Company paid MinQuest $10,000 and
well as reimbursed MinQuest for Truman’s holdings and related property costs in
the amount of $7,859.
In April
2010 our Board of Directors approved a $150,000 exploration program that will
include 3,000 feet of reverse circulation drilling. The project
covers 8 epithermal gold and silver targets hosted within a sequence of Tertiary
volcanics and Paleozoic sediments. These targets have been partially
defined by previous exploration groups over a 25 year period. The
historic efforts of five exploration groups have helped define high grade gold
and silver values occurring in veins and low grade gold values occurring in bulk
minable configurations.
The
company intends to concentrate on three previously identified mineralized
zones. Although the various targets were previously discovered by
others, they remain poorly explored because of past property disputes or a lack
of understanding of the geology and an ore model. Recent
breakthroughs in geologic concepts in the immediate area and ore models typified
by the aforementioned targets coupled with the historic results collected from
others work provides an excellent opportunity for Ranger to take advantage
of.
Ranger
intends to confirm its geologic theory through mapping of the target areas,
defining the targets with additional sampling and then drilling.
Results of
Operations
The
Year Ended March 31, 2010 compared to the Year Ended March 31, 2009
We did
not earn any revenues during the year ended March 31, 2010 or
2009. We do not anticipate earning revenues until such time as we
have entered into commercial production of our mineral properties. We
are presently in the exploration stage of our business and we can provide no
assurance that we will discover commercially exploitable levels of mineral
resources on our properties, or if such resources are discovered, that we will
enter into commercial production of our mineral properties.
27
For the
year ended March 31, 2010 we had a net loss of $187,903 compared to $53,980 in
the corresponding period in 2009. The increase in the net loss was
largely due to the acquisition of the CX and Truman properties from
MinQuest. Upon execution of the CX agreement, MinQuest accepted a
90-day, non-interest bearing promissory note from the Company for the initial
$20,000 property option payment. On February 25, 2010 the Company
paid the $20,000 balance of the note as well as reimbursed MinQuest for CX’s
holding and related property costs in the amount of $23,512. Upon
execution of the Truman agreement the Company paid MinQuest $10,000 and well as
reimbursed MinQuest for Truman’s holdings and related property costs in the
amount of $7,859. The Company did not have any mineral property
acquisition and exploration expenditures in 2009 as at that time the Company had
not yet become a mineral exploration business. General and
administrative expenses increased to $104,457 for the year ended March 31, 2010
from $53,810 for the same period in 2009. The increase was due to an
increased level of activity as the Company changed its business operations to
mineral exploration as well stock-based compensation of $58,626 that was
incurred in 2010 but not in 2009.
The
Year Ended March 31, 2009 compared to the period from May 11, 2007 (inception)
to March 31, 2008
We did
not earn any revenues during the year ended March 31, 2009 or for the period
from May 11, 2007 (inception) to March 31, 2008. For the year ended
March 31, 2009 we had a net loss of $53,980 compared to $2,850 for the period
from May 11, 2007 (inception) to March 31, 2008. The increase was due
to the Company undertaking very little activity for the period ended March 31,
2008 while for the year ended March 31, 2009 the Company incurred general and
administrative expenses as part of the filing of its S-1 registration
statement.
Liquidity and capital
resources
We had
total assets of $28,300 at March 31, 2010 consisting of cash of $27,189 and
prepaid expenses of $1,111. We had total liabilities of $44,872 at
March 31, 2010 all of which are current liabilities consisting of accounts
payable and accrued liabilities.
We
anticipate that we will incur the following to March 31, 2011:
|
|
-
|
$30,000
in connection with property option payments under the Company’s CX and
Truman option agreements;
|
|
|
-
|
$115,000
in property exploration expenses and claim payments in order to meet the
requirements of the Company’s property option
agreements;
|
|
-
|
$56,000
for operating expenses, including working capital and general, legal,
accounting and administrative expenses associated with reporting
requirements under the Securities Exchange Act of
1934.
|
28
Cash used
in operations was $37,981 for the year ended March 31, 2010 while it was $47,310
for 2009. The larger net loss in 2010 ($187,903) compared to 2009
($53,980) was offset by several factors. In 2010, there was
$58,626 in stock-based compensation while there was no such item in
2009. In 2010 accounts payable were increased by $62,407 while in
2009 accounts payable were reduced by $830. The effect of the change
over the two year period resulted in a $63,237 difference in cash flows from
2010 compared to 2009. In addition, the total property option
payments of $30,000 that have been included in the net loss for 2010 have been
classified as an investing activity on the statement of cash
flows. As a result of there being no known resource on either of the
Company’s exploration properties, the property option payments have been written
off and disclosed as investing activities. Cash flows from financing
activities for 2010 were the result of $93,000 received from private placements
and $1,830 in proceeds received from a loan payable compared to $15,500 received
from loan proceeds in 2009. The total loan balance of $17,330 was
forgiven in 2010.
Cash used
in operations was $47,310 for the year ended March 31, 2009 compared to $850 for
period from May 11, 2007 (inception) to March 31, 2008. The net loss
was $53,980 for the year ended March 31, 2009 while it was $2,850 for the period
from May 11, 2007 (inception) to March 31, 2008. There were no
investing activities in either period while financing activities in 2009 related
to $15,500 received from loan proceeds and for the period ended March 31, 2008
net proceeds of $33,000 were received from the sale of common
stock.
Cash from
operations from inception to date has not been sufficient to provide the
operating capital necessary to operate. On January 25, 2010 the Company
completed a private placement issuing 550,000 units at $0.15 per unit for total
proceeds of $82,500. Each unit consists of one common share of the
Company and two non-transferable share purchase warrants, designated Class A and
Class B. The Class A warrants are exercisable at a price of $0.25 per
share and the Class B warrants are exercisable at a price of $0.50 per
share. The Class A warrants are exercisable commencing January 25,
2011 and the Class B warrants are exercisable commencing January 25,
2012. Both the Class A and Class B warrants expire on January 25,
2015. On March 10, 2010 the Company closed a private placement of
70,000 common shares at $0.15 per share for a total offering price of
$10,500. On April 20, 2010, the Company completed a private placement
of 400,000 common shares at $1.25 per share for a total offering price of
$500,000. All of the above transactions were offered by the Company pursuant to
an exemption from registration under Regulation S of the Securities Act of 1933,
as amended.
Going Concern
Consideration
Management
believes that the gross proceeds from the private placements will be sufficient
to continue our planned activities until at least March 31, 2011, the end of our
next fiscal year. However, we anticipate generating losses and therefore we may
be unable to continue operations in the future as a going concern. No adjustment
has been made in the accompanying financial statements to the amounts and
classification of assets and liabilities that could result should we be unable
to continue as a going concern.
We
currently have no agreements, arrangements or understandings with any person to
obtain funds through bank loans, lines of credit or any other
sources.
29
Accordingly,
our independent auditors included an explanatory paragraph in their report on
the accompanying financial statements regarding concerns about our ability to
continue as a going concern. Our financial statements contain additional note
disclosures describing the circumstances that lead to this disclosure by our
independent auditors.
Off-balance sheet
arrangements
We have
no off-balance sheet arrangements.
A smaller
reporting company, as defined by Item 10 of Regulation S-K, is not required to
provide the information required by this item.
The
financial statements are set forth immediately preceding the signature
page.
Financial Disclosure.
None.
EVALUATION OF DISCLOSURE CONTROLS AND
PROCEDURES
As
required by Rule 13a-15 under the Securities Exchange Act of 1934 (the “Exchange
Act”), the Company’s management carried out an evaluation of the effectiveness
of the design and operation of its disclosure controls and procedures as of
March 31, 2010, being the date of the Company’s most recently completed fiscal
year end. This evaluation was carried out under the supervision and with the
participation of our Principal Executive Officer and Principal Financial
Officer, Mr. Gary Basrai.
Our Chief
Executive Officer and Principal Financial Officer, after evaluating the
effectiveness of the Company’s “disclosure controls and procedures” (as defined
in the Securities Exchange Act of 1934 (Exchange Act) Rules 13a-15(e) or
15d-15(e)) as of the end of the period covered by this annual report, has
concluded that our disclosure controls and procedures are effective at a
reasonable assurance level based on his evaluation of these controls and
procedures as required by paragraph (b) of Exchange Act Rules 13a-15 or
15d-15.
30
MANAGEMENT’S
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting. As defined in Rules 13a-15(f) under the
Securities Exchange Act of 1934, internal control over financial reporting is a
process designed by, or under the supervision of, the Company’s principal
executive, principal operating and principal financial officers, or persons
performing similar functions, and effected by the Company’s board of directors,
management and other personnel, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with accounting principles generally
accepted in the United States of America.
The
Company’s internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records, that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
Company’s assets; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the Company are being made only in accordance with
authorizations of the Company’s management and directors; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company’s assets that could have a
material effect on the financial statements.
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
The
Company’s management, including the Company’s Chief Executive Officer and
Principal Financial Officer assessed the effectiveness of the Company’s internal
control over financial reporting as of March 31, 2010. In making this
assessment, management used the framework in “Internal Control - Integrated
Framework” promulgated by the Committee of Sponsoring Organizations of the
Treadway Commission, commonly referred to as the “COSO” criteria. Based on the
assessment performed, management believes that as of March 31, 2010, the
Company’s internal control over financial reporting was not effective based upon
the COSO criteria due to the following material weakness:
|
·
|
Our
Company’s administration is composed of small number of administrative
individuals resulting in a situation where limitations on segregation of
duties exist. In order to remedy this situation we would need
to hire additional staff to provide greater segregation of
duties. Currently, it is not feasible to hire additional staff
to obtain optimal segregation of duties. Management will
reassess this matter in the following year to determine whether
improvement in segregation of duty is
feasible.
|
This
annual report does not include an attestation report of the Company’s
independent registered public accounting firm regarding internal control over
financial reporting. Management’s report was not subject to attestation by the
Company’s registered public accounting firm pursuant to temporary rules of the
SEC that permit the Company to provide only management’s report in this annual
report.
31
CHANGES
IN INTERNAL CONTROL OVER FINANCIAL REPORTING
During
the most recently completed fiscal year ended March 31, 2010, the Company made
use of a small number of administrative assistants and as a result, a limitation
in the segregation of duties occurred. This weakness has been
reported by the Company.
None.
Governance.
Directors and
Officers
.
All
directors of our Company hold office until the next annual general meeting of
the stockholders or until their successors are elected and qualified. The
officers of our Company are appointed by our board of directors and hold office
until their earlier death, retirement, resignation or removal. Our directors,
executive officers and other significant employees, their ages, positions held
and duration each person has held that position, are as follows:
|
Name
|
Position
Held with the Company
|
Age
|
Date
First Appointed
|
|
Gary
Basrai
|
Chairman,
President, Chief Executive Officer, Chief Operating Officer,
Secretary Treasurer, and Director
|
58
|
October
28, 2009
|
|
Paul
Strobel
|
Director
|
62
|
November
6, 2009
|
|
Shelby
Cave
|
Director
|
33
|
March
16, 2010
|
Business
Experience
The
following is a brief account of the education and business experience of each
director, executive officer and key employee during at least the past five
years, indicating each person’s principal occupation during the period, and the
name and principal business of the organization by which he was
employed.
Gary Basrai
is an accomplished
businessman who has owned and operated several businesses in the Fremont,
California area for over 30 years. He is the former President of the
Alameda County Pharmacist Association and a current Board member of the Alameda
Alliance for Health, a company which provides health care coverage to over
100,000 children and adults. In addition, Mr. Basrai is an active
consultant to several Intermediate Care Facilities as well as the Fremont
Surgery Center. Mr. Basrai holds a Doctorate of Pharmacy from the UOP
School of Pharmacy.
32
Paul Strobel
is an
accomplished geologist who has over 30 years of practical experience. Since 2008
he has been the Managing Partner of Western Resource Consultants which is a
privately-held business providing consulting services to the mineral exploration
industry. Prior to his current role he was a Vice President at Gold
Reef International for one year, General Manager at Chambers Group, Inc. for one
year and from 1997 to 2005 he was a contract geologist for Marston
Environmental. Mr. Strobel holds a Bachelor of Science degree
from the University of Arizona.
Shelby Cave
is in her final
year of a doctoral program in geological sciences at Arizona State University
(“ASU”) where she has been a researcher and instructor since
2001. Since 2008 she has also worked as a contract geologist
for a number of exploration companies. Ms. Cave obtained a Bachelor
of Geological Science degree from the University of North Carolina in 2000, a
Master’s in Geological Sciences from ASU in 2004 and anticipates completing her
doctorate at ASU in 2010.
There are
no family relationships among our directors or officers. None of our
directors or officers has been affiliated with any company that has filed for
bankruptcy within the last five years. We are not aware of any
proceedings to which any of our officers or directors, or any associate of any
such officer or director, is a party adverse to our company or has a material
interest adverse to it. There are no agreements with respect to the
election of Directors. Other than described in Section 10 below, we have not
compensated our Directors for service on our Board of Directors, any committee
thereof, or reimbursed for expenses incurred for attendance at meetings of our
Board of Directors and/or any committee of our Board of Directors.
Audit Committee Financial
Expert
.
The Board
of Directors has not established an audit committee and does not have an audit
committee financial expert. The Board is seeking additional Board members whom
it hopes will qualify as such an expert.
Section 16(a) Beneficial
Ownership Reporting Compliance
.
Section
16(a) of the Securities Exchange Act of 1934 requires officers and Directors of
the Company and persons who own more than ten percent of a registered class of
the Company’s equity securities to file reports of ownership and changes in
their ownership with the Securities and Exchange Commission, and forward copies
of such filings to the Company.
On May
11, 2007 by action taken by our board of directors, we issued 25,000,000 shares
of our common stock to Uziel Leibowitz, our former President, Chief Executive
Officer, Chairman, and Director. The shares were issued in
consideration for the payment of $500. This transaction was conducted
in reliance upon an exemption from registration provided under Section 4(2) of
the Securities Act of 1933, as amended. Mr. Leibowitz was our officer
and director and had access to all of the information which would be required to
be included in a registration statement, and the transaction did not involve a
public offering.
33
On
October 28, 2009 Uziel Leibowitz , the Company’s former principal shareholder
entered into a Stock Purchase Agreement which provided for the sale of
25,000,000 shares of common stock of the Company to Gurpartap (Gary) Singh
Basrai. Effective as of October 28, 2009, in connection with the share
acquisition, Mr. Basrai was appointed President, Chief Executive Officer, Chief
Financial Officer, Treasurer, Director, and Chairman of the
Company. Mr. Basrai has made the required filings with the Securities
and Exchange Commission.
Code of
Ethics
.
The
Company has not adopted a Code of Ethics, as defined by SEC rules that applies
to the Company's Chief Executive Officer and Chief Financial Officer, and
Secretary (its principal executive officer and principal accounting and
financial officer). The Company has not adopted such a Code of Ethics because of
the small size and limited resources of the Company, and because management's
attention has been focused on matters pertaining to raising capital and the
operation of the business.
Changes to Procedures for
Recommendations of Director Nominees
.
During
the fiscal year ended March 31, 2010, there were no material changes to the
procedures by which security holders may recommend nominees to our board of
directors.
Compensation
Discussion and Analysis.
During
the fiscal year ended March 31, 2010, Gary Basrai was our President, Chief
Executive Officer, Chairman, and Director. During such period, Mr. Basrai did
not receive any compensation for his services.
During
the period from May 11, 2007 (inception) to October 28, 2009, Uziel Leibowitz
was or President, Chief Executive Officer, Chairman and director. During such
period, Mr. Leibowitz did not receive any compensation for his services. Since
inception, we have not paid compensation exceeding $100,000 per year to any of
our executive officers.
Outstanding
Equity Awards
There has
been no equity awards of any kind granted to any of the Company’s officers or
directors as of March 31, 2010 or 2009.
Compensation
of Directors
The
Company pays two of its Directors $500 per month to serve on the Board of
Directors. Payments commence effective the date of appointment and
continue as long as the respective individual remains a member of the Board of
Directors. During the twelve months ended March 31, 2010 the Company
paid Mr. Strobel $2,500 and paid Ms. Cave $250
respectively. Effective April 1, 2010 the Company executed a
consulting agreement with Mr. Strobel to assist the Company with identifying and
assessing potential property acquisitions.
34
and Related Stockholder
Matters.
The
following table lists, as of June 24, 2010, the number of shares of common stock
of the Company beneficially owned by (i) each person or entity known to the
Company to be the beneficial owner of more than 5% of the outstanding common
stock; (ii) each officer and director of the Company; and (iii) all officers and
directors as a group. Information relating to beneficial ownership of common
stock by our principal stockholders and management is based upon information
furnished by each person using “beneficial ownership” concepts under the rules
of the Securities and Exchange Commission. Under these rules, a person is deemed
to be a beneficial owner of a security if that person has or shares voting
power, which includes the power to vote or direct the voting of the security, or
investment power, which includes the power to vote or direct the voting of the
security. The person is also deemed to be a beneficial owner of any security of
which that person has a right to acquire beneficial ownership within 60 days.
Under the Securities and Exchange Commission rules, more than one person may be
deemed to be a beneficial owner of the same securities, and a person may be
deemed to be a beneficial owner of securities as to which he or she may not have
any pecuniary beneficial interest. Except as noted below, each person has sole
voting and investment power.
The percentages below are calculated
based on 46,020,000 shares of Common Stock which are issued and outstanding as
of June 24, 2010. Unless indicated otherwise, all addresses below are
c/o Ranger Gold Corp., 2533 N. Carson Street, Suite 5018, Carson City, Nevada,
89706.
|
Name
of Beneficial Owner
|
Amount
and Nature of Beneficial Ownership
|
Percentage
of
Class
|
|||
|
Gary
Basrai
|
25,000,000
|
54.3%
|
|||
|
Paul
Strobel
|
-
|
-
|
|||
|
Shelby
Cave
|
-
|
-
|
|||
|
Directors
and Officers as a Group (3 individuals)
|
25,000,000
|
54.3%
|
Securities Authorized for
Issuance under Equity Compensation Plans
Information
regarding our equity compensation plans is set forth above under Part II, Item
5.
Related
Party Transactions
Other
than payments made to Directors for serving on the Company’s Board of Directors,
there were no related party transactions for the years ended March 31, 2010 or
2009.
35
Director
Independence
We are
not subject to the listing requirements of any national securities exchange or
national securities association and, as a result, we are not at this time
required to have our board comprised of a majority of “independent directors.”
We do not believe that any of our directors currently meet the definition of
“independent” as promulgated by the rules and regulations of the American Stock
Exchange.
Wolinetz, Lafazan & Company P.C.
was the independent registered public accounting firm for the Company from May
11, 2007 (inception) until November 4, 2009. On November 4, 2009, the Company
named Robison, Hill & Co. as its principal independent accountants. The
decision to change accountants was approved by the Registrant’s Board of
Directors. F
ees billed to the Company for the fiscal years
ending March 31, 2010 and 2009 are set forth below:
|
Fiscal
year ending
March
31, 2010
|
Fiscal
year ending
March
31, 2009
|
|||||||
|
Audit
Fees
|
$ | 12,000 | $ | 8,500 | ||||
|
Audit
Related Fees
|
NIL
|
NIL
|
||||||
|
Tax
Fees
|
NIL
|
NIL
|
||||||
|
All
Other Fees
|
NIL
|
NIL
|
||||||
As of
March 31, 2010, the Company did not have a formal, documented pre-approval
policy for the fees of the principal accountant. It is in the process of
adopting such a policy.
36
|
EXHIBIT
NUMBER
|
DESCRIPTION
|
|
|
3.1
|
Certificate
of Incorporation of Registrant. (1)
|
|
|
3.2
|
By-Laws
of Registrant. (1)
|
|
|
4.1
|
Form
of stock certificate. (1)
|
|
|
4.2
|
Form
of Class A Warrant. (3)
|
|
|
4.3
|
Form
of Class B Warrant. (3)
|
|
|
10.1
|
Form
of Regulation S Subscription Agreement (1)
|
|
|
10.2
|
CX
Property Option Agreement dated November 27, 2009 by and between Ranger
Gold Corp. and MinQuest, Inc. (2)
|
|
|
10.3
|
Form
of Regulation S Subscription Agreement (3)
|
|
|
10.4
|
2010
Stock Option Plan (4)
|
|
|
10.5
|
Form
of Regulation S Subscription Agreement (5)
|
|
|
10.6
|
Truman
Property Option Agreement dated March 29, 2010 by and between Ranger Gold
Corp. and MinQuest, Inc. (6)
|
|
|
31
|
Rule
13a-14(a)/15d14(a) Certifications (attached hereto)
|
|
|
32
|
Section
1350 Certifications (attached
hereto)
|
(1)
Previously filed as Exhibit 3.1 to Registration Statement, filed with the
Securities and Exchange Commission on June 4, 2008, file no.
333-151419
(2)
Previously filed with the Company’s Form 8-K submitted to the SEC on November
11, 2009.
(3)
Previously filed with the Company’s Form 8-K submitted to the SEC on January 26,
2010.
(4)
Previously filed with the Company’s Form 8-K submitted to the SEC on February 4,
2010.
(5)
Previously filed with the Company’s Form 8-K submitted to the SEC on March 3,
2010.
(6)
Previously filed with the Company’s Form 8-K submitted to the SEC on April 1,
2010.
37
RANGER
GOLD CORP.
(An
Exploration State Company)
-:-
INDEPENDENT
AUDITOR’S REPORT
MARCH 31,
2010 and 2009
38
|
Contents
|
Page
|
||
|
Report
of Independent Registered Public Accountants
|
F -
1
|
||
|
Balance
Sheets
|
|||
|
March
31, 2010 and 2009
|
F -
3
|
||
|
Statements
of Operations for the
|
|||
|
Years
Ended March 31, 2010 and 2009 and the Cumulative Period
|
|||
|
from
May 11, 2007 (inception) to March 31, 2010
|
F -
4
|
||
|
Statement
of Stockholders’ Equity
|
|||
|
Since
May 11, 2010 (inception) to March 31, 2010
|
F -
5
|
||
|
Statements
of Cash Flows for the
|
|||
|
Years
Ended March 31, 2010 and 2009 and the Cumulative Period
|
|||
|
from
May 11, 2007 (inception) to March 31, 2010
|
F –
6
|
||
|
Notes
to Financial Statements
|
F -
8
|
||
39
|
||||
|
ROBISON,
HILL & CO.
|
Certified
Public Accountants
|
|||
|
A
PROFESSIONAL CORPORATION
|
||||
|
BRENT
M. DAVIES, CPA
|
||||
|
DAVID
O. SEAL, CPA
|
||||
|
W.
DALE WESTENSKOW, CPA
|
||||
|
BARRY
D. LOVELESS, CPA
|
||||
|
STEPHEN
M. HALLEY, CPA
|
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS
Ranger
Gold Corp.
(formerly Fenario, Inc,)
(An
Exploration Stage Company)
We have
audited the accompanying balance sheets of Ranger Gold Corp. (formerly Fenario
Inc.) (an exploration stage company) as of March 31, 2010 and the related
statements of operations, and cash flows for the year ended March 31, 2010 and
the cumulative since May 11, 2007 (inception) to March 31, 2010, and the
statement of stockholder’s equity since May 11, 2007 (inception) to March 31,
2010. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the company’s
internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Ranger Gold Corp. (formerly Fenario
Inc.) (an exploration stage company) as of March 31, 2010 and the results of its
operations and its cash flows for the year ended March 31, 2010 and the
cumulative since May 11, 2007 (inception) to March 31, 2010, in conformity with
accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has incurred net losses of approximately $245,000 and
has no source of revenues, which raise substantial doubt about its ability to
continue as a going concern. Management’s plans in regard to these
matters are also described in Note 2. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
_/s/
Robison, Hill & Co.____
Certified
Public Accountants
Salt Lake
City, Utah
June 23,
2010
F -
1
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
Board of
Directors and Stockholders
Fenario,
Inc.
We have
audited the accompanying balance sheet of Fenario, Inc. (a Development Stage
Company) (“the Company”) as of March 31, 2009 and the related statements of
operations, stockholders’ equity (deficiency) and cash flows for the year then
ended. These financial statements are the responsibility of the
Company’s management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no
such opinion. Also, an audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Fenario, Inc. at March 31, 2009,
and the results of its operations and its cash flows for the year then ended in
conformity with accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has incurred an operating loss for the year ended March
31, 2009, has had no revenues and has not commenced planned principal
operations. These factors raise substantial doubt about the Company’s
ability to continue as a going concern. Management’s plans regarding
those matters are also described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
WOLINETZ,
LAFAZAN & COMPANY, P.C.
Rockville
Centre, New York
June 24,
2009
F -
2
RANGER GOLD CORP
.
(formerly
Fenario, Inc.)
(An
Exploration Stage Company)
BALANCE
SHEETS
|
March
31,
|
March
31,
|
|||||||
|
2010
|
2009
|
|||||||
|
ASSETS:
|
||||||||
|
Current
Assets:
|
||||||||
|
Cash
|
$
|
27,189
|
$
|
340
|
||||
|
Prepaid
expenses
|
1,111
|
—
|
||||||
|
Total
Current Assets
|
28,300
|
340
|
||||||
|
|
||||||||
|
Total
Assets
|
$
|
28,300
|
$
|
340
|
||||
|
LIABILITIES
& STOCKHOLDERS’ EQUITY (DEFICIT):
|
||||||||
|
Current
Liabilities:
|
||||||||
|
Accounts
Payable and Accrued Liabilities
|
$
|
44,872
|
$
|
1,170
|
||||
|
Loans
Payable (Note 5)
|
—
|
15,500
|
||||||
|
Total
Current Liabilities
|
44,872
|
16,670
|
||||||
|
Stockholders’
Equity (Deficit):
|
||||||||
|
Preferred
Stock, Par Value $.0001
|
||||||||
|
Authorized
5,000,000 shares,
|
||||||||
|
No
shares issued at March 31, 2010 and 2009
|
—
|
—
|
||||||
|
Common
Stock, Par Value $.0001
|
||||||||
|
Authorized
500,000,000 shares,
|
||||||||
|
Issued
45,620,000 shares at
|
||||||||
|
March
31, 2010 (March 31, 2009 – 45,000,000)
|
4,562
|
4,500
|
||||||
|
Paid-In
Capital
|
223,599
|
36,000
|
||||||
|
Deficit
Accumulated Since Inception of Exploration Stage
|
(244,733
|
)
|
(56,830
|
)
|
||||
|
|
||||||||
|
Total
Stockholders’ Equity (Deficit)
|
(16,572
|
)
|
(16,330)
|
|||||
|
Total
Liabilities and Stockholders’ Equity (Deficit)
|
$
|
28,300
|
$
|
340
|
||||
|
|
||||||||
The
accompanying notes are an integral part of these financial
statements.
F -
3
RANGER
GOLD CORP.
(formerly
Fenario, Inc.)
(An
Exploration Stage Company)
STATEMENTS
OF OPERATIONS
|
Cumulative
|
||||||||||||
|
Since
|
||||||||||||
|
May
11, 2007
|
||||||||||||
|
For
the Year Ended
|
Inception
of
|
|||||||||||
|
March
31,
|
Exploration
|
|||||||||||
|
2010
|
2009
|
State
|
||||||||||
|
Revenues
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||
|
Cost
of Revenues
|
—
|
—
|
—
|
|||||||||
|
Gross
Margin
|
—
|
—
|
—
|
|||||||||
|
Expenses:
|
||||||||||||
|
Mineral
Property Exploration Expenditures
|
53,071
|
—
|
53,071
|
|||||||||
|
General
and Administrative
|
104,457
|
53,810
|
161,117
|
|||||||||
|
Net
Loss from Operations
|
(157,528
|
)
|
(53,810
|
)
|
(214,188
|
)
|
||||||
|
Other
Income (Expense)
|
||||||||||||
|
Interest
|
(375
|
)
|
(170)
|
(545
|
)
|
|||||||
|
Net
Other Income (Expense)
|
(375
|
)
|
(170
|
)
|
(545
|
)
|
||||||
|
Write-down
of Mineral Property Acquisition Payments
|
(30,000
|
)
|
—
|
(30,000
|
)
|
|||||||
|
Net
Loss
|
$
|
(187,903
|
)
|
$
|
(53,980
|
)
|
$
|
(244,733
|
)
|
|||
|
Basic
and Diluted loss per
|
||||||||||||
|
Share
|
$
|
(0.00
|
)
|
$
|
(0.00)
|
|||||||
|
Weighted
Average Shares
|
||||||||||||
|
Outstanding
|
45,101,973
|
45,000,000
|
||||||||||
The
accompanying notes are an integral part of these financial
statements.
F -
4
RANGER
GOLD CORP.
(formerly
Fenario, Inc.)
(An
Exploration Stage Company)
STATEMENT
OF STOCKHOLDERS’ EQUITY (DEFICIT)
|
Deficit
|
||||||||||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||||||||||
|
During
|
||||||||||||||||||||||||||||
|
Preferred
Stock
|
Common
Stock
|
Paid-In
|
Exploration
|
|||||||||||||||||||||||||
|
|
Shares
|
Par
Value
|
Shares(1)
|
Par
Value
|
Capital
|
Stage
|
Total
|
|||||||||||||||||||||
|
Balance
at May 11, 2007
|
||||||||||||||||||||||||||||
|
(inception)
|
— | $ | — | — | $ | — | $ | — | $ | — | $ | - | ||||||||||||||||
|
Common
Stock Issued to
|
||||||||||||||||||||||||||||
| Founder at $0.00002 per share, | ||||||||||||||||||||||||||||
|
May, 2007
|
— | — | 25,000,000 | 2,500 | (2,000 | ) | — | 500 | ||||||||||||||||||||
|
Common
Stock Issued at $0.002
|
||||||||||||||||||||||||||||
|
per
share, January, 2008
|
— | — | 20,000,000 | 2,000 | 38,000 | — | 40,000 | |||||||||||||||||||||
|
Net
Loss
|
— | — | — | — | — | (2,850 | ) | (2,850 | ) | |||||||||||||||||||
|
Balance
at March 31, 2008
|
— | — | 45,000,000 | 4,500 | 36,000 | (2,850 | ) | 37,650 | ||||||||||||||||||||
|
Net
Loss
|
— | — | — | — | — | (53,980 | ) | (53,980 | ) | |||||||||||||||||||
|
Balance
at March 31, 2009
|
— | — | 45,000,000 | 4,500 | 36,000 | (56,830 | ) | (16,330 | ) | |||||||||||||||||||
|
Contributions
from shareholders
|
— | — | — | — | 36,035 | — | 36,035 | |||||||||||||||||||||
|
Common
Stock Issued at $0.15
|
||||||||||||||||||||||||||||
|
per
share, January, 2010
|
— | — | 550,000 | 55 | 82,445 | — | 82,500 | |||||||||||||||||||||
|
Common
Stock Issued at $0.15
|
||||||||||||||||||||||||||||
|
per
share, March, 2010
|
— | — | 70,000 | 7 | 10,493 | — | 10,500 | |||||||||||||||||||||
|
March
2010, Compensation
|
||||||||||||||||||||||||||||
|
from
the Issuance of Stock
|
||||||||||||||||||||||||||||
|
Options
at Fair Market Value
|
— | — | — | — | 58,626 | — | 58,626 | |||||||||||||||||||||
|
Net
Loss
|
— | — | — | — | — | (187,903 | ) | (187,903 | ) | |||||||||||||||||||
|
Balance
March 31, 2010
|
— | $ | — | 45,620,000 | $ | 4,562 | $ | 223,599 | $ | (244,733 | ) | $ | (16,572 | ) | ||||||||||||||
The
accompanying notes are an integral part of these financial
statements.
F -
5
RANGER
GOLD CORP.
(formerly
Fenario, Inc.)
(An
Exploration Stage Company)
STATEMENTS
OF CASH FLOWS
|
Cumulative
|
||||||||||||
|
Since
|
||||||||||||
|
May
11, 2007
|
||||||||||||
|
For
the Year Ended
|
Inception
of
|
|||||||||||
|
March
31,
|
March
31,
|
Exploration
|
||||||||||
|
2010
|
2009
|
State
|
||||||||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
|
Net
Loss
|
$
|
(187,903
|
)
|
$
|
(53,980
|
)
|
$
|
(244,733
|
)
|
|||
|
Adjustments
to Reconcile Net Loss to Net
|
||||||||||||
|
Cash
Used in Operating Activities:
|
||||||||||||
|
Compensation
Expense of Stock Options
|
58,626
|
—
|
58,626
|
|||||||||
|
Write-down
of Mineral Property Acquisition Cost
|
30,000
|
—
|
30,000
|
|||||||||
|
Deferred
Offering Costs
|
—
|
7,500
|
—
|
|||||||||
|
Change
in Operating Assets and Liabilities:
|
||||||||||||
|
(Increase)
Decrease in Prepaid Expenses
|
(1,111)
|
—
|
(1,111
|
)
|
||||||||
|
Increase
(Decrease) in Accounts Payable
and Accrued Liabilities
|
62,407
|
(830)
|
63,577
|
|||||||||
|
Net
Cash Used in Operating Activities
|
(37,981
|
)
|
(47,310)
|
(93,641
|
)
|
|||||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||
|
Mineral
Property Acquisition Costs
|
(30,000
|
)
|
—
|
(30,000
|
)
|
|||||||
|
Net
Cash Used in Investing Activities
|
(30,000
|
)
|
—
|
(30,000
|
)
|
|||||||
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
|
Proceeds
from Sale of Common Stock
|
93,000
|
—
|
133,500
|
|||||||||
|
Net
Proceeds from Loan Payable
|
1,830
|
15,500
|
17,330
|
|||||||||
|
Net
Cash Provided by Financing Activities
|
94,830
|
15,500
|
150,830
|
|||||||||
|
Net
(Decrease) Increase in
|
||||||||||||
|
Cash
and Cash Equivalents
|
26,849
|
(31,810)
|
27,189
|
|||||||||
|
Cash
and Cash Equivalents
|
||||||||||||
|
at
Beginning of Period
|
340
|
32,150
|
—
|
|||||||||
|
Cash
and Cash Equivalents
|
||||||||||||
|
at
End of Period
|
$
|
27,189
|
$
|
340
|
$
|
27,189
|
||||||
F -
6
RANGER
GOLD CORP.
(formerly
Fenario, Inc.)
(An
Exploration Stage Company)
STATEMENTS
OF CASH FLOWS
(Continued)
|
Cumulative
|
||||||||||||
|
Since
|
||||||||||||
|
May
11, 2007
|
||||||||||||
|
For
the Year Ended
|
Inception
of
|
|||||||||||
|
March
31,
|
March
31,
|
Exploration
|
||||||||||
|
2010
|
2009
|
State
|
||||||||||
|
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
|
||||||||||||
|
Cash
paid during the year for:
|
||||||||||||
|
Interest
|
$ | — | $ | — | $ | — | ||||||
|
Income
taxes
|
$ | — | $ | — | $ | — | ||||||
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
|
||||||||||||
|
Settlement
of Note Payable by a Contribution from a Shareholder (Note
5)
|
$ | 17,330 | $ | — | $ | 17,330 | ||||||
|
Settlement
of Accounts Payable by a Contribution from a Shareholder
|
$ | 18,705 | $ | — | $ | 18,705 | ||||||
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:
|
||||||||||||
During
the year ended March 31, 2010, the Company granted 1,400,000 stock options to
various consultants at exercise prices of $0.50 and $1.00 per share. The Company
has used the Black-Scholes model to determine the fair value of these stock
options. Consulting expense of $58,626 has been recorded for the year
ended March 31, 2010. The vesting period for some of these options is
up to three years. As a result, the unvested portions of the options
will be revalued in subsequent periods.
The
accompanying notes are an integral part of these financial
statements.
F -
7
Organization
and Basis of Presentation
Ranger
Gold Corp. (formerly Fenario, Inc.) (“the Company”) was incorporated on May 11,
2007 under the laws of the State of Nevada. The Company’s business at
that time was the development and licensing of proprietary software solutions
for healthcare providers, health care professionals and health insurance
companies.
On
October 28, 2009 the Company’s principal shareholder entered into a Stock
Purchase Agreement which provided for the sale of 25,000,000 shares of common
stock of the Company to Gary Basrai. Effective as of October 28, 2009, in
connection with the share acquisition, Mr. Basrai was appointed President, Chief
Executive Officer, Chief Financial Officer, Treasurer, Director, and Chairman of
the Company.
On
November 9, 2009, Mr. Basrai, as the holder of 25,000,000 (representing 55.5%)
of the issued and outstanding shares of the Company’s common stock, provided the
Company with written consent in lieu of a meeting of stockholders authorizing
the Company to amend the Company’s Articles of Incorporation for the purpose of
changing the name of the Company from “Fenario, Inc.” to “Ranger Gold
Corp.” In connection with the change of the Company’s name to Ranger
Gold Corp. the Company’s business was changed to mineral resource
exploration. The change in name and business received its final
approval by the regulatory authorities on January 7, 2010.
In
connection with the name change, the written consent also adopted a resolution
to split the Company’s common stock. The Board of Directors
subsequently approved a 5:1 forward stock split. The record and
payment dates of the forward split were January 15 and January 21, 2010
respectively. All of the common shares issued and outstanding
on January 15, 2010 were split. All references to share and per
share amounts have been restated in these financial statements to reflect the
split.
The
accompanying financial statements have been prepared in U.S. dollars and in
accordance with accounting principles generally accepted in the United States on
a going concern basis.
Nature
of Operations
The
Company has no products or services as of March 31, 2010. The Company
was established to operate in the development and licensing of proprietary
software solutions for healthcare providers, health care professionals and
health insurance companies. However, the Company was not able to
proceed in the intended business and on October 28, 2009 a change of control of
the Company took place. Subsequent to the change of control the
Company became a mineral resource exploration company and will continue to seek
opportunities in this field. The Company is currently engaging in the
acquisition, exploration, and if warranted and feasible, development of natural
resource properties.
The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
and commitments in the normal course of business. The Company has
incurred a net loss of $244,733 for the period from May 11, 2007 (inception) to
March 31, 2010, and has no sales.
The
Company's ability to continue as a going concern is dependent on its ability to
develop its natural resource properties and ultimately achieve profitable
operations and to generate sufficient cash flow from financing and operations to
meet its obligations as they become payable. The Company expects that it will
need approximately $201,000 to fund its operations during the next twelve months
which will include property option payments, exploration of its properties as
well as the costs associated with maintaining an office. The Company
completed a financing on April 20, 2010 for total proceeds of
$500,000. As a result, the Company currently has sufficient cash to
fund its planned operations for the next twelve months. However, in
order to develop its properties, the Company will need to obtain financing in
the future. Management plans to seek additional capital through
private placements and public offerings of its common stock. Although
there are no assurances that management’s plans will be realized, management
believes that the Company will be able to continue operations in the
future. Accordingly, no adjustment relating to the recoverability and
classification of recorded asset amounts and the classification of liabilities
has been made to the accompanying financial statements in anticipation of the
Company not being able to continue as a going concern.
F -
8
If the
Company were unable to continue as a going concern, then substantial adjustments
would be necessary to the carrying values of assets, the reported amounts of its
liabilities, the reported expenses, and the balance sheet classifications
used.
Management’s Estimates and
Assumptions
The
preparation of financial statements in conformity with generally accepted
accounting principles requires the Company’s management to make estimates and
assumptions that affect the amounts reported in these financial statements and
notes. Significant areas requiring the use of estimates relate to accrued
liabilities, stock-based compensation, and the impairment of long-lived
assets. Management believes the estimates utilized in preparing these
financial statements are reasonable and prudent and are based on management’s
best knowledge of current events and actions the Company may undertake in the
future. Actual results could differ from those estimates.
Reclassifications
Certain
reclassifications have been made in the financial statements for the year ended
March 31, 2009 to conform to accounting and financial statement presentation for
the year ended March 31, 2010.
Cash and Cash
Equivalents
For
purposes of the statement of cash flows, the Company considers all highly liquid
debt instruments purchased with a maturity of three months or less to be cash
equivalents to the extent the funds are not being held for investment
purposes.
Foreign
Currency
The
Company’s functional currency is the U.S. dollar and to date has undertaken all
of its transactions in U.S. dollars. Any transaction gains and losses that may
occur will be included in the statement of operations as they
occur.
Concentration of Credit
Risk
The
Company has no off-balance-sheet concentrations of credit risk such as foreign
exchange contracts, options contracts or other foreign hedging arrangements. The
Company maintains all of its cash balances with one financial institution in the
form of a demand deposit.
Loss per
Share
Net
income (loss) per share is computed by dividing the net income by the weighted
average number of shares outstanding during the period. As of March 31, 2010,
the company has outstanding common stock options and warrants of 1,400,000 and
1,100,000, respectively. The effects of the Company’s common stock
equivalents are anti-dilutive for March 31, 2010 and 2009 and are thus not
presented.
Comprehensive
Income
The
Company has adopted SFAS No. 130, “Reporting Comprehensive Income”, which
establishes standards for reporting and display of comprehensive income, its
components and accumulated balances. The Company has disclosed this information
on its Statement of Operations. Comprehensive income is comprised of net income
(loss) and all changes to capital deficit except those resulting from
investments by owners and distribution to owners.
Stock
Options
The
Company implemented Accounting Standards Codification ("ASC")
Section 718-10-25 (formerly Statement of Financial Accounting Standards
("SFAS") 123R, Accounting for Stock-Based Compensation) requiring the Company to
provide compensation costs for the Company's stock options determined in
accordance with the fair value based method prescribed in ASC
Section 718-20-25. The Company estimates the fair value of each stock
option at the grant date by using the Black-Scholes option-pricing model and
provides for expense recognition over the service period, if any, of the stock
option.
F -
9
Property Holding
Costs
Holding
costs to maintain a property on a care and maintenance basis are expensed in the
period they are incurred. These costs include security and maintenance expenses,
lease and claim fees payments, and environmental monitoring and reporting
costs.
Exploration and Development
Costs
Mineral
property interests include optioned and acquired mineral development and
exploration stage properties. The amount capitalized related to a mineral
property interest represents its fair value at the time it was optioned or
acquired, either as an individual asset or as a part of a business combination.
The value of such assets is primarily driven by the nature and amount of
mineralized material believed to be contained in such properties. Exploration
costs are expensed as incurred and development costs are capitalized if proven
and probable reserves exist and the property is a commercially minable property.
Mine development costs incurred either to develop new ore deposits, expand the
capacity of operating mines, or to develop mine areas substantially in advance
of current production are capitalized. Costs incurred to maintain assets on a
standby basis are charged to operations. Costs of abandoned projects are charged
to operations upon abandonment. The Company evaluates, at least quarterly, the
carrying value of capitalized mineral interests costs and related property,
plant and equipment costs, if any, to determine if these costs are in excess of
their net realizable value and if a permanent impairment needs to be recorded.
The periodic evaluation of carrying value of capitalized costs and any related
property, plant and equipment costs are based upon expected future cash flows
and/or estimated salvage value.
Fair Value of Financial
Instruments
The
carrying value of the Company's financial instruments, including prepaid
expenses, accounts payable and accrued liabilities, and loans payable at March
31, 2010 and 2009 approximates their fair values due to the short-term nature of
these financial instruments.
New Accounting
Pronouncements
ASC 805
In
December 2007, the FASB issued ASC 805, “
Business Combinations”
. Among
other things, ASC 805 establishes principles and requirements for how the
acquirer in a business combination (i) recognizes and measures in its financial
statements the identifiable assets acquired, the liabilities assumed, and any
non-controlling interest in the acquired business; (ii) recognizes and measures
the goodwill acquired in the business combination or a gain from a bargain
purchase; and (iii) determines what information to disclose to enable users of
the financial statements to evaluate the nature and financial effects of the
business combination. ASC 805 was effective for fiscal years beginning on or
after December 15, 2008. This standard will affect the Company’s accounting
treatment for any future business combinations.
ASC
815-10
In March
2008, the FASB issued guidance, included in ASC 815-10
“Derivatives and Hedging,”
which seeks to enhance disclosure about how and why a company uses
derivatives; how derivative instruments are accounted for and how derivatives
affect a company’s financial position, financial performance and cash flows.
This Statement was effective for financial statements issued for fiscal years
and interim periods beginning after November 15, 2008. This Statement
encourages, but does not require, comparative disclosures for earlier periods at
initial adoption. The adoption of this statement did not have a material effect
on the Company’s reported financial position or results of
operations.
F -
10
ASC
815-40
In June
2008, the FASB ratified guidance which is now part of ASC 815-40, “
Contracts in Entity’s Own
Equity
”. The objective of this issue is to provide guidance for
determining whether an equity-linked financial instrument (or embedded feature)
is indexed to an entity’s own stock. This issue applies to any freestanding
financial instrument or embedded feature that has all the characteristics of a
derivative instrument or an instrument which may be potentially settled in an
entity’s own stock regardless of whether the instrument possess derivative
characteristics. This issue provides a two-step approach to assist in making
these determinations and is effective for financial statements issued for fiscal
years beginning after December 15, 2008. The adoption of this statement did not
have a material effect on the Company’s reported financial position or results
of operations.
ASC 820
In April
2009, the FASB issued additional disclosure requirements related to fair values,
which are included in ASC 820, “
Interim Disclosures about Fair Value
of Financial Instruments.”
The provisions require disclosures about fair
value of financial instruments for interim reporting periods of publicly traded
companies as well as in annual financial statements. The required disclosures
were effective for interim reporting periods ending after June 15, 2009. The
adoption of the provisions did not have a material impact on the Company’s
statements of financial position, results of operations and cash
flows.
AS 855
In May
2009, the FASB issued FASB ASC 855,
“Subsequent Events”
. FASB ASC
855 incorporates accounting and disclosure requirements related to subsequent
events into U.S. GAAP. The requirements of FASB ASC 855 for subsequent-events
accounting and disclosure are not significantly different from those in existing
accounting standards, which the Company has historically followed for financial
reporting purposes. As a result, the adoption of this guidance did not have any
material impact on the financial statements. The Company has evaluated
subsequent events through the filing date of these financial
statements.
ASC 105
In July
2009, the FASB issued new guidance relating to the
FASB Accounting Standards
Codification
at FASB
ASC 105, as the single source of authoritative nongovernmental U.S. generally
accepted accounting principles (GAAP). The codification is effective for interim
periods ending after September 15, 2009. All existing accounting standards were
superseded as described in ASC 105. All other accounting literature not included
in the Codification is non-authoritative. The adoption of ASC 105 did not impact
the Company’s results of operations, financial position or cash
flows.
ASU
2009-05
In August
2009, the FASB issued ASU No. 2009-05, “
Measuring Liabilities at Fair
Value,
” or ASU 2009-05, which amends ASC 820 to provide clarification of
a circumstances in which a quoted price in an active market for an identical
liability is not available. A reporting entity is required to measure fair value
using one or more of the following methods: 1) a valuation technique that uses
a) the quoted price of the identical liability when traded as an asset or b)
quoted prices for similar liabilities (or similar liabilities when traded as
assets) and/or 2) a valuation technique that is consistent with the principles
of ASC 820. ASU 2009-05 also clarifies that when estimating the fair value of a
liability, a reporting entity is not required to adjust to include inputs
relating to the existence of transfer restrictions on that liability. The
adoption of this ASU did not have an impact on the Company’s financial
statements.
F -
11
CX
Property
On
November 27, 2009 the Company executed a property option agreement with
MinQuest, Inc. (“MinQuest”) granting the Company the right to acquire 100% of
the mining interests of a mineral exploration property currently controlled by
MinQuest. The property known as the CX Property is located in Nye
County, Nevada and currently consists of 72 unpatented claims (the
‘CX”). Annual option payments and minimum annual exploration
expenditures are as noted below:
|
Property
|
Work
|
|||
|
Payments
|
Expenditures
|
|||
|
Upon
Execution of the Agreement
|
$
|
-
|
$
|
-
|
|
By
February 25, 2010
|
20,000
|
-
|
||
|
By
February 25, 2011
|
20,000
|
50,000
|
||
|
By
February 25, 2012
|
20,000
|
150,000
|
||
|
By
February 25, 2013
|
30,000
|
200,000
|
||
|
By
February 25, 2014
|
40,000
|
350,000
|
||
|
By
February 25, 2015
|
50,000
|
200,000
|
||
|
By
February 25, 2016
|
50,000
|
200,000
|
||
|
By
February 25, 2017
|
50,000
|
200,000
|
||
|
By
February 25, 2018
|
50,000
|
200,000
|
||
|
By
February 25, 2019
|
50,000
|
200,000
|
||
|
By
February 25, 2020
|
100,000
|
750,000
|
||
|
$
|
480,000
|
$
|
2,500,000
|
|
Upon
execution of the CX agreement, MinQuest accepted a 90-day, non-interest bearing
promissory note from the Company for the initial $20,000 property option
payment. On February 25, 2010 the Company paid the $20,000 balance of
the note as well as reimbursed MinQuest for CX’s holding and related property
costs in the amount of $23,512. As a result of the CX property not
containing any known resource, the Company has written down its initial $20,000
property option payment in the statement of operations and comprehensive loss at
March 31, 2010.
F -
12
Truman
Property
On March
29, 2010, the Company executed a second property option agreement with MinQuest
granting the Company the right to acquire 100% of the mining interests of a
Nevada mineral exploration property currently controlled by
MinQuest. The property known as the Truman Property is located in
Mineral County, Nevada and currently consists of 52 unpatented claims (the
“Truman”). Annual option payments and minimum annual exploration
expenditures are as noted below:
|
Property
|
Work
|
|||
|
Payments
|
Expenditures
|
|||
|
Upon
Execution of the Agreement
|
$
|
10,000
|
$
|
-
|
|
By
March 29, 2011
|
10,000
|
50,000
|
||
|
By
March 29, 2012
|
20,000
|
150,000
|
||
|
By
March 29, 2013
|
30,000
|
200,000
|
||
|
By
March 29, 2014
|
40,000
|
350,000
|
||
|
By
March 29, 2015
|
50,000
|
200,000
|
||
|
By
March 29, 2016
|
50,000
|
200,000
|
||
|
By
March 29, 2017
|
50,000
|
200,000
|
||
|
By
March 29, 2018
|
50,000
|
200,000
|
||
|
By
March 29, 2019
|
50,000
|
200,000
|
||
|
By
March 29, 2020
|
150,000
|
750,000
|
||
|
$
|
510,000
|
$
|
2,500,000
|
|
Upon
execution of the Agreement the Company paid MinQuest $10,000 and well as
reimbursed MinQuest for Truman’s holdings and related property costs in the
amount of $7,859. As a result of the Truman property not containing any known
resource, the Company has written down its initial $10,000 property option
payment in the statement of operations and comprehensive loss at March 31,
2010.
Under the
two agreements with MinQuest, all of our payment obligations are
non-refundable. If we do not make any payments under either of the
respective agreements we will lose any payments made and all our rights to that
respective property. If all said payments under an agreement are made, then we
will acquire all mining interests in that respective property. If the
Company fails to make any payment when due, each agreement gives the Company a
60-day grace period to pay the amount of the deficiency.
MinQuest
has retained a 3% royalty of the aggregate proceeds received by the Company from
any smelter or other purchaser of any ores, concentrates, metals or other
material of commercial value produced from either property, minus the cost of
transportation of the ores, concentrates or metals, including related insurance,
and smelting and refining charges, including penalties.
The
Company may use MinQuest for its mineral exploration expertise on the
properties. Furthermore, both the Company and MinQuest have the right to assign,
sell, mortgage or pledge their rights in each respective agreement or on each
respective property. In addition, any mineral interests staked, located, granted
or acquired by either the Company or MinQuest which are located within a one
mile radius of either property will be included in the option granted to the
Company for that respective property.
F -
13
Either
agreement can be terminated independent of the other
agreement. Either agreement will terminate if the Company fails to
comply with any of its obligations under either agreement and fails to cure such
alleged breach. If the Company gives notice that it denies a default has
occurred, the matter shall be determined finally through such means of dispute
resolution as such matter has been subjected to by either party. Each agreement
provides that all disputes shall be resolved by a sole arbitrator under the
rules of the Arbitration Act of Nevada. The Company also has the right to
terminate either agreement independent of the other agreement by giving notice
to MinQuest.
The loan
payable was due on demand and bore interest at 5% per annum. Upon the
acquisition of control by Mr. Basrai on October 28, 2009 the loan and accrued
interest in the total amount of $17,330 was forgiven by the lender.
Deferred
tax assets of the Company are as follows:
|
2010
|
2009
|
|||||||
|
Non-capital
losses carried forward
|
63,000 | 19,000 | ||||||
|
Less:
valuation allowance
|
(63,000 | ) | (19,000 | ) | ||||
|
Deferred
tax asset recognized
|
- | - | ||||||
A
valuation allowance has been recorded to reduce the net benefit recorded in the
financial statements related to these deferred tax assets. The valuation
allowance is deemed necessary as a result of the uncertainty associated with the
ultimate realization of these deferred tax assets.
The
provision for income tax differs from the amount computed by applying statutory
federal income tax rate of 34% (2009 – 34%) to the net loss for the
year. The sources and effects of the tax differences are as
follows:
|
2010
|
2009
|
|||||||
|
Computed
expected tax benefit
|
64,000 | 18,000 | ||||||
|
Permanent
differences
|
(20,000 | ) | - | |||||
|
Change
in valuation allowance
|
(44,000 | ) | (18,000 | ) | ||||
|
Income
tax provision
|
- | - | ||||||
As of
March 31, 2010, the Company had a net operating loss carryforward for income tax
reporting purposes of approximately $185,000 (2009 - $57,000) which expire
between 2028 and 2030.
The
Company currently pays two of its directors $500 per month to serve on its Board
of Directors. The payments are made quarterly in
advance. The total amount paid to the Directors for the year ended
March 31, 2010 was $2,750 (2009 - $nil). In addition, the Company has
a consulting agreement with one of its directors to provide a variety of
services including assisting with the identification and assessment of
properties for potential acquisition. No services were rendered and
no payments were made under this consulting agreement for the years ended March
31, 2010 or 2009.
F -
14
On
February 3, 2010 the Company adopted its 2010 Stock Option Plan (“the 2010
Plan”). The 2010 Plan provides for the granting of up to 5,000,000
stock options to key employees, directors and consultants, of common shares of
the Company. Under the 2010 Plan, the granting of stock options, the
exercise prices, and the option terms are determined by the Company's Option
Committee, a committee designated to administer the 2010 Plan by the Board of
Directors. For incentive options, the exercise price shall not be
less than the fair market value of the Company's common stock on the grant date.
(In the case of options granted to an employee who owns stock possessing more
than 10% of the voting power of all classes of the Company's stock on the date
of grant, the option price must not be less than 110% of the fair market value
of common stock on the grant date.). Options granted are not to
exceed terms beyond five years. No stock options have been granted
under the 2010 Plan.
In order
to exercise an option granted under the Plan, the optionee must pay the full
exercise price of the shares being purchased. Payment may be made either: (i) in
cash; or (ii) at the discretion of the Committee, by delivering shares of common
stock already owned by the optionee that have a fair market value equal to the
applicable exercise price; or (iii) with the approval of the Committee, with
monies borrowed from us.
Subject
to the foregoing, the Committee has broad discretion to describe the terms and
conditions applicable to options granted under the Plan. The Committee may at
any time discontinue granting options under the Plan or otherwise suspend, amend
or terminate the Plan and may, with the consent of an optionee, make such
modification of the terms and conditions of such optionee’s option as the
Committee shall deem advisable.
For the
year ended March 31, 2010, 1,400,000 stock options were granted to various
consultants at exercise prices of $0.50 and $1.00 per share. No
options were granted under the 2010 Plan during the year ended March 31,
2009. The Black-Scholes option pricing model was used to calculate to
estimate the fair value of the options granted in 2010. The following
assumptions were made:
|
Risk
Free Rate
|
0.18%
|
|
Expected
Life of Option
|
5
years
|
|
Expected
Volatility of Stock (Based on Historical Volatility)
|
84.1%
|
|
Expected
Dividend yield of Stock
|
0.00
|
Total
stock option expense of $58,626 was recognized for the year ended March 31, 2010
with $7,710 being recorded as mineral property exploration expenditures and
$50,916 as general and administrative.
The
following table sets forth the options outstanding under the 2010 Plan as of
March 31, 2010:
|
Available
for Grant
|
Options
Outstanding
|
Weighted
Average Exercise Price
|
||||||||||
|
Balance,
March 31, 2009
|
- | - | $ | - | ||||||||
|
Approval
of 2010 Plan
|
5,000,000 | - | - | |||||||||
|
Options
granted
|
(1,400,000 | ) | 1,400,000 | $ | 0.68 | |||||||
|
Balance,
March 31, 2010
|
3,600,000 | 1,400,000 | $ | 0.68 | ||||||||
The
following table summarizes information concerning outstanding and exercisable
common stock options under the 2010 Plan at March 31, 2010:
|
Exercise
Prices
|
Options
Outstanding
|
Remaining
Contractual Life
(in
years)
|
Weighted
Average
Exercise
Price
|
Number
of Options Currently Exercisable
|
Weighted
Average
Exercise
Price
|
|
$
0.50
|
900,000
|
4.96
|
$
0.50
|
-
|
$
0.50
|
|
$
1.00
|
500,000
|
4.96
|
$
1.00
|
-
|
$
1.00
|
|
1,400,000
|
$
0.68
|
-
|
F -
15
The
aggregate intrinsic value of stock options outstanding at March 31, 2010 was
$590,000 and the aggregate intrinsic value of stock options exercisable at March
31, 2010 was $nil. No stock options were exercised in
2010. As of March 31, 2010 there was $1,077,974 in unrecognized
compensation expense that will be recognized over three years.
A summary
of status of the Company’s unvested stock options as of March 31, 2010 under all
plans is presented below:
|
Number
of
Options
|
Weighted
Average
Exercise
Price
|
Weighted
Average
Grant
Date Fair Value
|
||||||||||
|
Unvested
at March 31, 2009
|
- | - | - | |||||||||
|
Granted
|
1,400,000 | $ | 0.68 | $ | 0.27 | |||||||
|
Vested
|
- | - | - | |||||||||
|
Unvested
at March 31, 2010
|
1,400,000 | $ | 0.68 | $ | 0.27 | |||||||
On
January 25, 2010, the Company issued 550,000 Class A warrants and 550,000 Class
B warrants. Each Class A warrant is exercisable for one common share
at an exercise price of $0.25 per warrant for a period of four years commencing
January 25, 2011. Each Class B warrant is exercisable for one common
share at an exercise price of $0.50 per warrant for a period of three years
commencing January 25, 2012.
The
following table sets forth common share purchase warrants outstanding as of
March 31, 2010:
| Warrants Outstanding | ||||
|
Balance,
March 31, 2009
|
- | |||
|
Warrants
granted
|
1,100,000 | |||
|
Balance,
March 31, 2010
|
1,100,000 | |||
The
following table lists the common share warrants outstanding at March 31,
2010. Each warrant is exchangeable for one common share.
|
Number
Outstanding
|
Exercise
Price
|
Weighted
Average Contractual Remaining Life (years)
|
Number
Currently Exercisable
|
Exercise
Price
|
|
550,000
|
$
0.50
|
4.83
|
-
|
$
0.50
|
|
550,000
|
$
1.00
|
4.83
|
-
|
$
1.00
|
|
1,100,000
|
-
|
In May
2007 the Company issued 25,000,000 shares of common stock to the founder of the
Company at $0.00002 per share for total proceeds of $500.
In
January 2008 the Company sold 20,000,000 shares of common stock to private
investors at $.002 per share for gross proceeds of $40,000.
F -
16
On
January 25, 2010 the Company completed a private placement issuing 550,000 units
at $0.15 per unit for total proceeds of $82,500. The units were
offered by the Company pursuant to an exemption from registration under
Regulation S of the Securities Act of 1933, as amended. Each unit
consists of one common share of the Company and two non-transferable share
purchase warrants, designated Class A and Class B. The Class A
warrants are exercisable at a price of $0.25 per share and the Class B warrants
are exercisable at a price of $0.50 per share. The Class A warrants
are exercisable commencing January 25, 2011 and the Class B warrants are
exercisable commencing January 25, 2012. Both the Class A and Class B
warrants expire on January 25, 2015.
On March
10, 2010 the Company closed a private placement of 70,000 common shares at $0.15
per share for a total offering price of $10,500.
On
November 9, 2009 the Company received a written consent in lieu of a meeting of
stockholders (the “Written Consent”) from the holder of 25,000,000 (representing
55.5%) of the issued and outstanding shares of our common stock. The
Written Consent adopted
the resolution to change
the Company’s name to Ranger Gold Corp. In connection with the name
change the Written Consent also adopted a resolution to split the Company’s
common stock. The Board of Directors subsequently approved a 5:1
forward stock split. The record and payment dates of the forward
split were January 15 and January 21, 2010 respectively. All of
the common shares issued and outstanding on January 15, 2010 were
split. All references to share and per share amounts have been
restated in these financial statements to reflect the split.
On
September 15, 2009 the Company entered into a one year lease for its shared
office at a rate of $202 per month.
On April
20, 2010, the Company completed a private placement of 400,000 common shares at
$1.25 per share for a total offering price of $500,000.
F -
17
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
|
RANGER
GOLD CORP.
|
|
|
Dated:
June 24, 2010
|
By:
/s/ Gary Basrai
|
|
Name: Gary
Basrai
|
|
|
Title: President,
Chief Executive and Operating Officer, Secretary and Treasurer, and
Director (Principal Executive, Financial and Accounting
Officer)
|
|
In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.
|
SIGNATURE
|
TITLE
|
DATE
|
|
|
/s/Gary Basrai
Gary
Basrai
|
Director,
President, Chief Executive and Operating Officer, Secretary, and Treasurer
(Principal Executive, Financial, and Accounting Officer)
|
June
24, 2010
|
|
|
/s/ Paul Strobel
Paul Strobel
|
Director
|
June
24, 2010
|
|
|
/s/ Shelby Cave
Shelby Cave
|
Director
|
June
24, 2010
|
|
TABLE OF CONTENTS
Part IItem 1. Description Of BusinessItem 1A. Risk FactorsItem 1B. Unresolved Staff CommentsItem 2. Description Of PropertiesItem 3. Legal ProceedingsItem 4. (removed and Reserved)Part IIItem 5. Market For Registrant S Common Equity, Related StockholderItem 6. Selected Financial DataItem 7. Management S Discussion and Analysis Or Plan Of OperationItem 7A Quantitative and Qualitative Disclosure About Market RiskItem 8. Financial StatementsItem 9. Changes in and Disagreements with Accountants on Accounting andItem 9a(t). Controls and ProceduresItem 9a(t)Item 9B. Other InformationItem 10. Directors, Executive Officers and CorporateItem 11. Executive CompensationItem 12. Security Ownership Of Certain Beneficial Owners and ManagementItem 13. Certain Relationships and Related Transactions, and Director IndependenceItem 14 Principal Accounting Fees and ServicesItem 15. ExhibitsNote 1 Nature Of Business and OperationsNote 2 Ability To Continue As A Going ConcernNote 3 Summary Of Significant Accounting PoliciesNote 4 Mineral Property InterestsNote 5 - Loan PayableNote 6 - Income TaxesNote 7 - Related Party TransactionsNote 8 - Stock OptionsNote 9 - WarrantsNote 10 - Common Stock TransactionsNote 11 - Stock SplitsNote 12 - Commitments and ContingenciesNote 13 Subsequent Event