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.
|
||||||||
| o | ||||||||
|
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.
|
||||||||
|
Large
accelerated filer
|
o |
Accelerated
filer
|
o | |||||
|
Non-accelerated
filer
|
o |
Smaller
reporting company
|
x
|
|||||
|
Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).
|
o |
Yes
|
x
|
No
|
||||
|
State
the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common
equity was last sold, or the average bid and asked price of such common
equity, as of the last business day of the registrant’s most recently
completed second fiscal quarter.
|
||||||||
|
The
aggregate market value based on the average bid and asked price on the
over-the-counter market of the Registrant’s common stock, (“Common Stock”)
held by non-affiliates of the Company was US$1,068,465 as at June 30,
2008.
There
were 26,711,630 outstanding shares of Common Stock as of October 10,
2008*
|
||||||||
|
APPLICABLE
ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
|
||||||||
|
PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
|
||||||||
|
Indicate
by check mark whether the registrant has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange
Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
|
||||||||
| o |
Yes
|
o |
No
|
|||||
|
DOCUMENTS
INCORPORATED BY REFERENCE
|
||||||||
|
Not
Applicable
|
||||||||
Golden River Resourc - Recent Material Event_____________________
* (Does
not include 10,000,000 shares of Common Stock that are issuable upon exercise of
Special Warrants, without the payment of any additional
consideration. See Item 7. “Management’s Discussion and
Analysis of Financial Condition or Plan of Operation – Liquidity and Capital
Resources.”)
INDEX
PART
I
Item
1 Business
General
Our name
is Golden River Resources Corporation and we sometimes refer to ourselves in
this Annual Report as “Golden River Resources”, the “Company” or as “we,” “our,”
or “us.” We changed our name from Bay Resources Ltd to Golden River Resources in
March 2006. We are an exploration stage mining company. Our objective
is to exploit our interest in the mineral claims in Nunavut, Canada which are in
the Slave Craton and in the Committee Bay Greenstone Belt. Our
principal exploration target is for gold and we are seeking to determine whether
adequate gold reserves are present on the property covered by our claims to
develop an operating mine. We are in the initial stages of our
exploration program and have not yet identified any ore reserves.
We hold
the interests in the Slave Craton directly and our wholly owned subsidiary named
“Golden Bull Resources Corporation” (formerly 4075251 Canada Inc.) holds the
interests in the Committee Bay Greenstone Belt. Our wholly-owned
subsidiary is referred to in this Annual Report as “Golden Bull”.
We
sometimes refer to our claims collectively in this Annual Report as either the
“Slave Properties” or the “Committee Bay Properties”. Our claims are
registered in the Mining Recorders Office in the Mining District of Nunavut and
give us the right to explore and mine minerals from the property covered by the
claims.
We were
incorporated in the State of Delaware on February 1, 1973. We
commenced our mineral exploration activities in 2002. Prior thereto,
we were engaged in a number of other business activities that have been
discontinued. Our executive offices are at Level 8, 580 St. Kilda
Road, Melbourne, Victoria 3004 Australia and we have an office at 1 Yonge
Street, Suite 1801, Toronto, Ontario M5E 1W7, Canada. Our website location is
www.goldenriverresources.com. Information
included on our website shall not be deemed to be incorporated in this Annual
Report. Our wholly owned subsidiary, Golden Bull, was incorporated on
May 27, 2002 in the Province of Ontario, Canada and is licensed to do business
in the Northwest Territories and Nunavut Canada.
Currency.
We use the
Australian dollar as our reporting currency, since we are headquartered in
Australia and our administrative expenses are incurred in Australian
dollars. References to dollars are to Australian dollars (A$) unless
otherwise indicated as being Canadian dollars (CDN$) or United States dollars
(US$). For the convenience of the reader, the Australian Dollar figures for the
year ended June 30, 2008 have been translated into United States Dollars (“US$)
using the rate of exchange at June 30, 2008 of A$1.00=US$0.9615.
History
of the Company
Our
predecessor corporation, Bayou Oil, was incorporated under the laws of Minnesota
in 1973 and since that time it had a number of activities that have been
ceased.
On
February 13, 1998, we incorporated a 100% owned subsidiary, Baynex.com Pty Ltd
(formerly Bayou Australia Pty Ltd), a corporation incorporated under the laws of
Australia.
On June
29, 1999 we undertook a reverse stock split on a 1:20 basis and amended our
Articles of Incorporation to amend the par value of our shares from US$0.15
cents to US$0.0001 cents per share. On September 27, 1999 we changed our name
from Bayou International, Ltd to Baynet, Ltd.
In May
2000, we commenced work on the development of a B2B mining portal however, this
was abandoned as it was considered uneconomic.
On August
21, 2000 we incorporated a new wholly owned subsidiary, Bay International Pty
Ltd (now known as Bay Resources (Asia) Pty Ltd), a corporation incorporated
under the laws of Australia. In October 2000, we changed our name to Bay
Resources Ltd, and in March 2006, we changed it to Golden River Resources
Corporation.
During
fiscal 2001, we conducted a due diligence review of St. Andrew Goldfields Ltd
(“St. Andrew”) with a view to taking a substantial investment in St.
Andrew. Following the conclusion of the review, we decided not to
proceed with the investment.
In May
2002, we incorporated a new wholly owned subsidiary, Golden Bull Resources
Corporation (formerly 4075251 Canada Inc.), a corporation incorporated under the
laws of Canada. Golden Bull is the vehicle that will be used by the Company to
undertake exploration activities for gold on the Committee Bay Properties in
Canada.
During the
2002 fiscal year we continued to expand our gold exploration business
by:
In October
2002 we entered into an agreement (via our wholly owned subsidiary Bay Resources
(Asia) Pty Ltd) with the Tibet Bureau of Geology and Minerals Exploration
Development, China to earn a minimum 51% interest in the Xigaze copper belt
running in a 200 kilometre east-west trend either side of Lhasa. However, in
February 2003 we decided to withdraw from these arrangements as a result of
further hurdles being placed before us by the Chinese authorities that were not
known at the time of entering into the agreement.
In April
2008 the Company deregistered 100% owned inactive subsidiaries Baynex.com Pty
Ltd and Bay Resources (Asia) Pty Ltd, both companies incorporated under the laws
of Australia.
In June
2008 the Company agreed on terms with Tahera Diamond Corporation to obtain full
control of properties listed in the 2002 Tahera/GRR agreement through the
issuance of 3,000,000 shares of common stock and the payment of CDN$86,000, but
final agreements had not been executed as of October 10, 2008. The agreement is
subject to the Supreme Court of Canada’s approval.
It is the
policy of our Board of Directors that we will not engage in any activities which
would subject us to registration and reporting requirements of the Investment
Company Act of 1940.
SEC
Reports
We file
annual, quarterly, current and other reports and information with the
SEC. These filings can be viewed and downloaded from the Internet at
the SEC’s website at www.sec.gov. In addition, these SEC filings are available
at no cost as soon as reasonably practicable after the filing thereof on our
website at www.goldenriverresources.com. These reports are also
available to be read and copied at the SEC’s public reference room located at
Judiciary Plaza, 100 F Street, N.E., Washington, D.C. 20549. The public may
obtain information on the operation of the public reference room by calling the
SEC at 1-800-SEC-0330.
Description
Of Business
Introduction
We are an
exploration stage company engaged in the identification, acquisition,
exploration and development of mining prospects believed to have gold
mineralization. The main objective is to explore, identify, and develop
commercially viable prospects over which we have rights that could produce
revenues. These types of prospects may also contain mineralization of metals
often found with gold, such as platinum and silver and other ‘base metals’
(copper, nickel, lead, zinc) which also may be worth processing. Exploration and
development for commercially viable mineralization of any metal includes a high
degree of risk which careful evaluation, experience and factual knowledge may
not eliminate, and therefore, we may never produce any revenues.
We hold
properties in Nunavut, Canada. Golden River Resources holds interests in the
Slave Craton area within Nunavut and our currently owned 100% subsidiary; Golden
Bull Resources holds various prospects in the Committee Bay Greenstone Belt in
Nunavut. We are in the initial stages of exploration programs and have not
yet identified any ore reserves.
Please
note that the Glossary in Appendix A to the Annual Report contains definitions
for the geological and other specialized terms used in this
section.
Slave
Craton Properties
During
2002, we reached an agreement with the Canadian company, Tahera Diamond
Corporation, to explore for gold on Tahera’s extensive properties on the Slave
Craton in Nunavut, Canada. At that time, Tahera’s Slave land package included
177 mineral claims and 11 Inuit Owned Land (“IOL”) Concessions covering
approximately 471,000 acres. As of September 30, 2008, the holdings have been
reduced to 86 mineral claims and 8 Inuit Owned Land (“IOL”) Concessions covering
approximately 261,000 acres. Tahera is a diamond mining company conducting
diamond exploration in the northern Slave Craton and brought its Jericho diamond
pipe into production in 2006.
The
exploration properties of Tahera that the Company has access to are grouped into
two main areas, the High Lake Volcanic Belt and the Contwoyto Formation, both of
which are located in the Slave craton, Mackenzie District of
Nunavut.
The
exploration properties in the High Lake Volcanic Belt, originally consisted of
the Hood River mineral claims and Hood Inuit Owned Land (“IOL”) concessions, all
of which were located in the northwest section of the Slave Structural Province.
The mineral claims (Hood 3, 4, 12 and 14) totalled 10,330 acres (two of which;
the Hood 3 and 4 mineral claims have subsequently lapsed). The original Hood
River IOL concessions were subsequently consolidated and reduced to the current
Hood River CO-20-00-03R IOL concession which encompasses an area of 6,254 acres.
The high grade Hood River gold showings identified to date occur within a 9 by 5
kilometre area in the west-central portion of the High Lake Greenstone Belt.
Four main mineralized areas within the IOL have been identified to date; the
North Fold Nose, the Penthouse, the Crown and the Blackridge
Prospects.
The
exploration properties, within the Contwoyto Formation, consist of the
CO-08-00-01, 02, 03 and 05 IOL Concessions which are located on the east side of
Contwoyto Lake. The original CO-08-00-01, 02, 03 and 05 Concession
Agreement totalled 65,250 acres but has subsequently been reduced to cover
11,061.10 acres. Mineralization specific to the properties includes a
number of significant banded iron formation hosted gold prospects including the
R44-R47, R43-R45, the 4-2 Grid Area, , and the 5-5 Grid Area
Prospects.
The
agreement with Tahera dated March 7, 2002 gives us rights of access to
exploration data of Tahera covering gold, silver and base metal potential on
properties 100% held by Tahera or properties which are adjacent to or in the
area of the Tahera properties. Tahera has an extensive database of data to which
we have access, including geophysical surveys, overburden and bedrock mapping,
overburden sampling and drilling data. We have agreed to pay them a two percent
net smelter return royalty on any production from gold and base metals we
discover having used Tahera’s extensive database. If during our exploration for
gold, silver or base metals on the 100% Tahera held mineral properties, we
discover diamonds, Tahera retains the rights to the diamonds. Under the
agreement, if we wish to conduct exploration on the properties, we need to seek
access to the properties and enter into an access agreement with Tahera,
suitable to Tahera, which sets out the terms of our access. Our access cannot
interfere with Tahera’s operations on the properties. Tahera has the sole and
unfettered discretion to sell, transfer, assign, encumber, mortgage, pledge,
hypothecate, allow to lapse, forfeit, surrender or in any way dispose of its
interest in the properties. Should Tahera sell, transfer, assign the properties,
we would then need to negotiate access with the new holder of the properties. We
undertake exploration at our sole risk. Subject to Tahera’s rights, we have the
right to exploit opportunities for gold, silver or base metals on the
properties. In return, GRR has granted Tahera a 2% net smelter return royalty on
any mineral deposit discoveries that GRR may identify.
The
Company entered into access agreements with Tahera for the 2004 to 2006
exploration programs. No field exploration was undertaken during 2007 and 2008
and therefore we did not enter into access agreements for 2007 and
2008.
On January
16, 2008, Tahera Diamond Corporation obtained an order from the Ontario Superior
Court granting it protection pursuant to the provisions of the Companies’
Creditors Arrangement Act (“CCAA”) for 30 days, with subsequent extensions to
November 30, 2008.
In June
2008, the Company agreed on terms with Tahera Diamond Corporation to obtain full
control of the mining properties that are listed in the Tahera/GRR agreement
through the issuance of 3,000,000 shares of common stock and the payment of
CDN$86,000, but final agreements have not been executed as at October 10, 2008.
The agreement is subject to the Supreme Court of Canada approval.
Each of
the properties has minimum annual exploration expenditure commitments required
to be met to maintain the rights to the property. The minimum annual commitments
can be met either by actual exploration expenditures or by making a cash payment
in lieu of exploration expenditure. Expenditures by both Tahera and
GRR are counted towards these commitments. In 2004 and 2006, the
commitments were met by a mixture of exploration expenditure and cash payments
by both Tahera and GRR. For 2007 and 2008, these commitments were met
by a cash payment from Golden River Resources offset by application of accrued
work commitments previously compiled by Tahera.
Exploration
work undertaken by GRR is subject to the Mining Land Use Regulations of the
Indian and Northern Affairs Canada Mining Act. This Act requires GRR to obtain
permits prior to performing significant exploration programs and sets standards
that must be met for development and reclamation.
On April
1, 1999, the Nunavut Land Claims Agreement, dated May 28, 1993, between the
Inuit of Canada’s eastern arctic region and Her Majesty the Queen in right of
Canada, came into force. Under this agreement, the Inuit were granted ownership
of approximately 360,000 square kilometres of land in an area referred to as the
Nunavut Settlement Area, including ownership of subsurface rights in
approximately 37,500 square kilometres of those lands. Third party
interests in lands in the Nunavut Settlement Area created on or after April 1,
1999 are granted, in the case of surface rights, by the appropriate regional
Inuit association and, in the case of subsurface rights, by Nunavut Tungavik
Incorporated (“NTI”) which will hold subsurface title to Inuit owned lands and
will be additionally responsible, in consultation with the appropriate regional
Inuit associations, for the administration and management of those subsurface
rights. The Tahera Inuit Owned Lands property CO-20-00-03R is
administered by the NTI. All non-IOL properties are administered by
the Federal Government of Canada.
A list of
the mining properties that are covered under the Tahera/GRR agreement appears as
Appendix B to this Annual Report. Exploration interest is currently
focused on the CO-20-00-03R IOL and CO-08-01, 02, 03 and 05 IOL
concessions.
The claims
are maintained in good standing by applying an annual work commitment or a
payment in lieu of work. Fees and exploration expenditures associated
with the maintenance of Tahera Corporation’s ground covered under the Slave
Craton Agreement with Golden River Resources are the responsibility of
Tahera.
Location
All
mineral properties that fall under the Tahera-Golden River Resources agreement
are located in the Slave Craton of the central arctic area of Nunavut,
Canada. The Slave Craton is a relatively small Archean craton,
dominated by greenstone belts and turbidite sequences and underlain by older
gneisses and granitoid bodies. The Slave Craton or Slave Structural
Province encompasses an elliptical area approximately 500 kilometres wide by 750
kilometres long, located between Great Slave Lake to the south and Coronation
Gulf to the north (Figure 1).
Hood River
Ground
The Hood
River mineral properties and Inuit Owned Land Concessions are in the High Lake
Volcanic Belt located in the northwest section of the Slave Structural Province
in the Mackenzie District of Nunavut. The land holdings include 4 mining
properties totalling 10,330 acres, two of which have subsequently lapsed. The
original Hood River CO-20 IOL concessions were subsequently consolidated and
reduced to the current Hood River CO-20-00-03R IOL Concession which encompasses
an area of 5,173.64 acres. Only the IOL concession is within the
greenstone component of the High Lake Volcanic Belt and therefore of exploration
interest to us. The approximate center of the Inuit Concessions is about 45
kilometers north of the Arctic Circle, and 530 kilometers north-northeast of
Yellowknife. The IOL Concessions are held 50:50 by Benachee Resources Inc. and
Snowpipe Resources Ltd. (both wholly owned by Tahera). There are no known
encumbrances on the concessions.
Contwoyto
Lake Ground
The
original C0-08 Concession Agreement totalled 65,250 acres but was subsequently
reduced to 11,061.10 acres (4,476.36 hectares). The approximate centre of the
C0-08 Concession is 100 kilometres south of the Arctic Circle, 100 kilometres
north-northwest of Lac de Gras, and 380 kilometres north-northeast of
Yellowknife. The C0-08 Concession Agreement is held 50:50 by Benachee Resources
Inc. and Snowpipe Resources Ltd. (both wholly owned by Tahera)
Access,
Infrastructure, Local Resources
Access to
all the areas within the Slave Craton is by aircraft. In summer
months, float equipped aircraft may land on local lakes of appropriate size
including Contwoyto Lake, Napatulik Lake, Penthouse Lake, and Carat Lake. In
addition, airstrips are available for fixed wing aircraft equipped with tundra
tires at the Lupin mine site, the ULU Mine Site and Tahera’s Carat Camp
(Jericho). Helicopter support is required to mobilize personnel from
camp sites to the property areas. A winter road which links
Yellowknife to the Lupin Mine Site on Contwoyto Lake has historically been used
for economical transportation of supplies during the winter
months. This road has since been extended northward to Tahera’s Carat
Camp.
The Tahera
Properties are located in the treeless Arctic within the zone of
permafrost. The weather in the property areas is typical of the
continental barren lands which experience cool summers and extremely cold
winters. Winter temperatures can reach -45 degrees. Summer
temperatures are generally in the 5 to 10 degree Celsius range but can reach the
high 20 degrees Celsius range. Average annual snowfall rarely exceeds
1 metre, most of which falls during autumn and spring storms. Small
lakes are clear of ice usually by the third week in June and start freezing over
again in mid to late September.
The
topography of the area consists of low rolling hills with areas of low-lying
swampy muskeg. Local relief is low, rarely exceeding 150
metres.
The
closest community with regularly scheduled air service is Kugluktuk (formerly
Coppermine) which is located 145 kilometres northwest of the Tahera Anuri /
Rockinghorse Concessions and 200 kilometres northwest of the Hood River
Concessions. First Air has scheduled flights everyday from
Yellowknife to Kugluktuk. The main centre for transportation to the
properties is through Yellowknife, 530 kilometres southwest of the Hood River
Concessions, and 410 kilometres southwest of the Contwoyto
Concessions. Fixed wing and helicopter charter services are available
in Yellowknife, as are all supplies (groceries, lumber, fuel, etc.) and
expediting services. Additional existing infrastructure to assist
servicing the company’s land holdings includes the Tahera Jericho Mine Site and
the Lupin and ULU Mine Sites which belong to Oz Minerals (formerly
Wolfden/Zinifex); however, all are currently on care and
maintenance. There is no infrastructure on the Hood or Contwoyto IOL
Concessions.
Exploration
History
There are
currently no known gold, silver or base metal mineral reserves identified on the
Hood or Contwoyto IOL concessions. All work undertaken in the past
has been strictly exploratory in nature.
All
previous work reported by companies is quoted from open file government
assessment reports. For the Slave Craton land holdings non diamond-related
exploration activities are emphasized as these relate to our interest and
exploration agreement with Tahera. Specifically, previous exploration work on
the Hood River/High Lake and Contwoyto Lake land holdings are detailed as these
are deemed to be most prospective for gold.
Hood
River/ High Lake Belt
Exploration
around and directly within the Hood River properties began in 1965
and over the years has included sampling, mapping, trenching, and
drilling, as well as ground and airborne geophysical
surveys.
In 1989
the ULU Gold Deposit was discovered. It is immediately adjacent, and
abuts onto, the western border of Company’s Hood River CO-20-00-03R
IOL. Previous exploration efforts undertaken within the Hood River
CO-20-00-03R IOL have outlined several key areas of anomalous gold
mineralization which include the Penthouse North and South Zones, the Blackridge
Zone, the Crown Zone and the North Fold Nose Zone.
In 1999
when the Nunavut Land Claims Agreement came into effect the Inuit were granted
surface ownership of approximately 360,000 square kilometres of land, of which
they have the subsurface rights for approximately 37,500 square
kilometres. Nunavut Tunngavik Incorporated (NTI) is the entity
through which these subsurface rights are administered. The Hood River Area
around the ULU Deposit (CROWN, DEN, FIDO and ULU) in which Golden River
Resources has an exploration interest was ultimately incorporated into NTI
lands, with the exception of the original ULU Claim currently being evaluated by
Oz Minerals (formerly Wolfden/Zinifex).
In March,
2003, Strongbow Resources Inc. and Nunavut Tunngavik Incorporated announced an
agreement whereby Strongbow could explore a large parcel of land which covers
all the south half of the High Lake Greenstone Belt and borders Tahera’s IOL
concession on the east, south, and west.
Contwoyto
Formation
Following
the discovery of the Lupin Mine on the western shore of Contwoyto Lake in 1960,
exploration for additional Lupin-style banded iron formation hosted gold
deposits commenced throughout the Contwoyto Formation. This resulted in the
discovery of a number of prospects many of which occur on Tahera’s Contwoyto
properties.
Significant
results that substantiate the gold prospectivity of the region have been
reported on several key areas which include the R43-R45, the R44-R47 and the 5-5
prospects.
Diamond
exploration began in the area in 1993. Discovery of several
kimberlite bodies prompted a helicopter-borne EM and magnetic survey over 110
square kilometers in the Contwoyto Lake area. A part of the Tahera data set this
survey has delineated a number of prospective iron formations.
Geological
Setting
The Slave
Structural Province encompasses an elliptical area approximately 500 kilometres
wide by 750 kilometres long, located between Great Slave Lake to the south and
Coronation Gulf to the north (Figure 1).
The
Yellowknife Supergroup, an important host for ore deposits, occurs as twenty-six
linear volcanic belts surrounded by granitic batholiths. These belts
are typically isoclinally folded and largely range in age from 2715-2671 million
years. The belts have been divided in the literature into either
mafic volcanic-dominated (Yellowknife-Type) or felsic volcanic-dominated
(Hackett River-Type). Yellowknife-Type volcanic belts are dominated
by massive to pillowed basalt flows with lesser amounts of felsic volcanic,
volcaniclastic rocks, clastic sedimentary rocks and occasionally synvolcanic
conglomerate and carbonate units. The Hackett River-Type belts are
defined by the abundance of calc-alkaline felsic and intermediate volcanic rocks
generally intercalated with turbidite sedimentary sequences.
At least
five episodes of Proterozoic diabase dyke “swarms” (2400 million years – 600
million years) have been recorded in the Slave Structural
Province. These dyke sets form local positive relief where they
intrude easily eroded lithologies such as the metaturbidites and negative relief
in areas where they are juxtaposed with granites and gneisses.
No known
gold, silver or base metal mineral reserves are known on our land. All previous
programs have been exploratory in nature.
Prospects
The Slave
Craton is a well mineralized area with huge potential for discovering mineral
deposits. Diamond, gold, copper, lead and zinc deposits have been
identified.
Hood River
Ground
High grade
gold showings have been identified within a 9 by 7 kilometre block in the
west-central portion of the High Lake Greenstone Belt within the CO-20-00-03R
IOL. To date, four main mineralized areas are known to occur; the
North Fold Nose Zone, Penthouse Zones, Crown Zone and Blackridge
Zone. The mineral prospects on the property occur in rocks of the
same age and nature as mineralization at the adjacent ULU Gold Deposit where
gold occurs in brecciated basaltic wall rock clasts which are replaced by
acicular arsenopyrite + quartz + K-feldspar.
There is a
spatial relationship between the gold-bearing zones of the ULU Deposit and the
axial trace of the ULU Anticline. The North Fold Nose Area within the
CO-20-00-03R IOL covers the northern most two kilometres of this important fold
axis. Several gold-bearing zones have been previously identified in this
area. In one area along the axis of the anticline, a one metre wide
quartz vein outcrops for over 40 metres. Samples contain
arsenopyrite, pyrite, pyrrhotite, chalcopyrite, and native copper
mineralization. Highly anomalous silver and bismuth geochemical
values were also returned from these samples.
Further
mineralized zones were discovered in the central fold of the North Fold
Nose. A highly anomalous gold value was produced within the prospect
area from narrow quartz-pyrite vein rubble.
Previous
exploration by Aber (1985), BHP-Utah (1988, 1989 and 1992) and Golden River
(2004) has outlined five zones of gold mineralization on the Crown Prospect (now
largely lying within the existing CO-20-00-03R IOL). At the “Main
Zone” several highly anomalous gold values were returned from samples taken
within an 800 metre long, silicified, basalt/biotite schist contact
zone. Seven trenches have been dug into the Main Zone
Area. Silicified zones up to 6 metres wide containing disseminated
arsenopyrite were noted. The “B Zone” is parallel to, and 80 metres
east of, the Main Zone. The structural setting and mineralogy of this zone is
similar to that at the Main Zone. Elevated gold values have been
identified over a distance of 450 metres and the zone is reported to be open to
the north. Elevated gold values were also reported from grab samples,
obtained from the “Western Zone” and also from the folded stratigraphy of the
“Eastern” and “Fold” Zones, of silicified basalt and sediment which contained
disseminated arsenopyrite mineralization.
The
Penthouse Prospects are located to the northwest of the Crown
Prospects. The original sampling on the South Penthouse Grid returned
anomalous gold values. The highest grade sample was from a silicified,
north-trending shear zone which can be traced for approximately 200
metres. Another northeast-trending shear, this one traceable for 250
metres on the North Penthouse Area returned significant gold results from
samples taken of narrow arsenopyrite-bearing veins. Several
additional, highly prospective zones of surface mineralization have been
identified in the Penthouse Area.
Geochemical
samples of the polymetallic quartz veins in the area contain highly elevated
silver values along with anomalous zinc, lead, cadmium, and antimony
values. This style of mineralization is very similar to the
auriferous polymetallic quartz vein at the Northern Fold Nose on the historic
ULU 2 Claim.
Five
principal styles of mineralization were identified by BHP on the Penthouse Grid,
namely:
In the
Penthouse area, massive sulphide mineralization is present as discontinuous
pods, locally up to 1.5 metres thick, which occur along the western
basalt-sediment contact on the south Penthouse grid. Historically,
anomalous values of gold, silver, copper lead and zinc have been returned from
surface grab sampling. No drilling was carried out on the southern
Penthouse Prospect.
The
Blackridge Prospect is located south of the Crown Prospects and across the
southeastern edge of a granitic intrusion. This area was previously
evaluated by Aber Resources Ltd. during the 1985 field season. The
mineralization consists of an altered and locally brecciated gabbro-hosted,
silicified zone. The principal mineralized zone has been traced
intermittently on surface for at least 700 metres northeast and is up to 2.5 -
3.5 metres wide. Anomalous gold values have been identified along this
structure.
 Contwoyto
Property
More than
100 iron formation-hosted gold occurrences occur in the Point Lake - Contwoyto
Lake meta-sedimentary sequence. The most notable gold-bearing iron formation is
on the west side of Contwoyto Lake, in the vicinity of the formerly producing,
Lupin Gold Mine. Mineralization on the east side of Contwoyto Lake,
specific to the Tahera/Golden River Resources Properties includes a number of
significant iron formation hosted gold prospects including the R43-R45, the
R44-R47, the 4-2 grid, the Ox, and the 5-5 Grid Prospects.
The poorly
exposed R43-R45 Prospect is reported to be hosted by a “Z”-shaped, folded iron
formation up to 10 metres wide and traceable intermittently for over 1.3
kilometres. Initial, minor, “grab” sampling of the banded iron
formation in the area by GRR crews has, so far, failed to reproduce the sampling
results reported by previous workers. Significantly more detailed
sampling and geologic mapping of this area is required. The geology,
mineralization, alteration and structure are reported to be extremely similar to
the Lupin Gold Mine (located across the lake, 28 kilometres to the west) where
gold mineralization occurred in a “Z” folded iron formation and was associated
with pyrrhotite and arsenopyrite mineralization. The reported R43-R45
“Z” fold would be of the same magnitude as that at the Lupin Mine. No
previous drilling has ever been reported to have been undertaken from the
R43-R45 Area.
The
R44-R47 Prospect is hosted by an iron formation up to 5 metres wide and
traceable on surface for 1.9 kilometres. Again, significant
historical gold values have been returned from surface sampling but have yet to
be reproduced by initial Company sampling. Significantly more
detailed sampling and geologic mapping of this area is required. No
drilling in this area has been reported.
On the 4-2
Prospect, previous explorers have traced a sulphide-rich iron formation, in
boulders up to 2 metres in size, on surface for 200
metres. Significant gold assays have been returned; however, no
follow-up drilling appears to have been done.
On the
Grid 5-5 Prospect, several east-west trending, 300 to 2,700 metres long EM
conductors have been outlined. A total of six iron formations have
been identified, four of which are coincident with the EM conductors.
Sulphide-rich boulders of iron formation located at the southwest section of
Grid 5-5 yielded gold values. The “Fox A” Prospect is also within the
5-5 Grid Area. Here the iron formation is 33 metres wide and 220
metres long and has returned gold values. Drilling undertaken in 1987 on the 5-5
Prospect included 8 holes totalling 942 metres. All eight holes
intersected iron formation and returned gold from a section containing pyrite,
arsenopyrite and pyrrhotite mineralization. Four short drill holes on
the 5-5 Grid in 1988 tested a folded iron formation as outlined by an IP
survey. DDH 88-4, drilled 225 metres west of an earlier high grade
intercept, intercepted a further significant gold intersection in pyrite-rich,
siliceous iron formation. A further high grade surface prospect
containing arsenopyrite and quartz-rich iron formation boulders was apparently
not drilled. The other drill holes intersected siliceous +/-
sulphidic iron formation ranging from 5.7 to 15.0 metres thick.
Work
Programs
The first
phase of the Company’s planned exploration programs over the Hood River and
Contwoyto IOL claim groups was carried out in August 2004 and consisted of
exploration mapping, sampling and prospecting. This initial program was designed
to follow up and assess geophysical and geological anomalies reported by
previous workers with a focus on targeting and expanding areas for phase two
work.
Hood River
Ground
Golden
River Resources spent CDN$104,446 on exploration on the Hood River IOL
Concessions. Four key areas warrant further investigation.
Northern Fold Nose - This
zone is located approximately 3 kilometres north of the ULU Deposit and is
thought to be part of the major fold structure which hosts the ULU
Deposit. Additional mineralized zones were discovered within the
Northern Fold Nose Area than previously described. Acicular
arsenopyrite was noted in narrow shears within silicified basalt just south of
the Northern Fold Nose. Chip sampling of the exposed veins during the
2004/2006 field seasons yielded several samples carrying anomalous gold
values.
The
Penthouse Prospects are underlain by a geologically and structurally complex
package of mafic volcanic and metasediments. The metasediments are
thought to form the conduit for mineralizing fluids. Gabbroic sills
occur within the mafic volcanics and sediments and form marker horizons
outlining the structural complexity of the area.
Penthouse North Zone - During
the 2004 program, a total of 65 samples were taken in the North Penthouse Area;
30 of these or 46 per cent of these samples yielded gold values of >500ppb Au
and 20 of these samples or 31 percent of all the samples taken on this prospect
during 2004 yielded gold values of >1000ppb Au. During 2006, a
total of 91 samples were taken in the North Penthouse Area; 44 of these or 48
percent of the samples taken from this area yielded gold values of >500ppb Au
and 27 of these samples or 30 percent of all the samples taken on this prospect
during 2006 yielded gold values of >1000ppb Au.
Penthouse South Zone - During
2004, a total of 53 samples were taken in the South Penthouse Area; 12 of these
or 23 percent of the samples taken from this area yielded gold values of
>500ppb Au and 6 of these samples or 11 percent of all the samples taken on
this prospect during 2004 yielded gold values of >1000ppb
Au. During 2006, a total of 147 samples were taken in the South
Penthouse Area; 28 of these or 19 percent of the samples taken from this area
yielded gold values of >500ppb Au and 25 of these samples or 17 percent of
all the samples taken on this prospect during 2006 yielded gold values of
>1000ppb Au. In both of the Penthouse Areas, the samples exhibited
a strong, positive arsenic-gold relationship.
Cursory
analysis of airborne geophysical data suggests that the South and North
Penthouse Areas may actually one zone that is over 2 kilometres in strike
length.
Crown - The 2004 field work
consisted largely of examining and sampling of the trenches in this area. A
total of 60, 1.0 metre to 1.5 metre chip samples were taken from these trenches
and 32 per cent of these samples returned with anomalous gold
values. Due to time constraints and significant sampling undertaken
during 2004 which indicates this area to be a significant drill target, this
Crown Area was not evaluated during the 2006 program.
Blackridge Area - The main
mineralization occurs along a gabbro-sediment contact. The previously
described linear mineralized contact zone was extended to slightly over 750
metres.
Anomalous
results were returned from siliceous metavolcanics and metasediments with the
highest gold values being returned from trenches cut into the gabbro -
metavolcanic/metasediment contact zone. The company has obtained a total of 68
samples from this prospect. Elevated gold and copper values were
noted. During the 2004 program, a total of 39 samples were taken in
the Blackridge Area; 14 of these or 36 percent of the samples taken from this
area yielded gold values of >500ppb Au and 13 of these samples or 33 percent
of all the samples taken on this prospect during 2004 yielded gold values of
>1000ppb Au. During 2006, a total of 29 samples were taken in the
Blackridge Area; 12 of these or 41 percent of the samples taken from this area
yielded gold values of >500ppb Au and 9 of these samples or 31 percent of all
the samples taken on this prospect during 2006 yielded gold values of
>1000ppb Au. Generally, the 2004 and 2006 results were an
improvement over the reported historical results.
Contwoyto
IOL Concessions
We spent
CDN$109,057 on exploration on the Contwoyto IOL Concessions. Some key areas that
warrant further investigation include:
Grid 5-5
Area - Field work revealed the area to be underlain by a package of
amphibole-rich, silicate facies iron formation. This area produced
the best gold results in the Contwoyto concessions. Previous
geophysical surveys over the area indicated the zone trends west, off shore,
into the East Arm of Contwoyto Lake, proximal to the Grid 5-5
Zone. Initial rock chip sampling from this and the contained “Fox A”
area by the company returned significant results. Significantly more
detailed geologic mapping, ground geophysical surveys, trenching and sampling of
this area is required before final testing by a drill program.
R43-R45
Prospect - The poorly exposed R43-R45 Prospect is reported to be hosted by a
Z-shaped folded iron formation up to 10 metres wide and traceable intermittently
for over 1.3 kilometres. Significantly more detailed geologic
mapping, geophysical surveys, trenching and sampling of this area is required to
define the exact shape and size of the reported “Z” fold and define drill
targets.
R44-R47
Prospect - The R44-R47 Prospect is hosted by an iron formation up to 5 metres
wide and traceable on surface for 1.9 kilometres. Significantly more
detailed geologic mapping, geophysical surveys, trenching and sampling of this
area is required to define the exact shape and size of any folding subsequent to
defining any drill targets.
 An
airborne geophysical survey has outlined a number of strong magnetic anomalies
that have no surface expression. These areas require further
investigation.
Geophysical
Surveys
The
company has not undertaken any surface of airborne geophysical surveys over the
property. It does; however, have access to Tahera’s airborne
(helicopter) geophysical magnetic data collected over specific areas of both the
Contwoyto and Hood IOLs generated during Tahera’s search for kimberlite
bodies. Specific ground magnetic (Mag), electromagnetic (EM) and
induced polarization (IP) surveys are being planned over areas of identified
surface mineralization in both the Contwoyto and Hood IOL.
Further
Exploration – Slave Craton
After the
initial Tahera (and subsequent Golden River) evaluation the Contwoyto IOL
concessions of the Contwoyto Lake Area, the original size of the concession was
dramatically reduced from 65,250.8 acres to the current 11,061.10
acres. The Company believes that all prospective ground was
retained. The area reduction was done in conjunction with Tahera
Diamond Corp. and it served to greatly reduce the amount of exploration
assessment requirements for this area. A small portion of the
original Hood River IOL Concession Area was also reduced with all prospective
ground retained for further exploration.
To
maintain the Contwoyto IOL into 2009 a work commitment or a cash payment in lieu
of assessment work in the amount of CDN$145,000.00 will be
required. To maintain the Hood IOL into 2009 a work commitment or a
cash payment in lieu of assessment work in the amount of CDN$213,000.00 will be
required.
As a
result of the a compilation of the historical exploration results previously
undertaken in the area and the results of the company’s 2004 field season,
several areas quickly emerged as having a strong potential to host gold
mineralization, based on geological, mineralogical and structural criteria and
as such would require further examination.
In late
July 2006, Golden River Resources mobilized equipment and personnel to further
prospect, assess and evaluate the Contwoyto Lake and Hood River
Areas. The work program was to follow up Golden River Resources’
highly successful 2004 examination with a focus on highlighting key areas on
which to develop a future (2009) drilling program.
During the
2006 summer field program, 901 samples were taken throughout the Contwoyto and
Hood IOL concessions and several areas were soon targeted as key regions for
future work based on current geological modeling, the re-assessment of
historical work and sample results from the 2004 program. All 2006
rock samples were sent for preparation and analysis by Acme Analytical
Laboratories Ltd. Samples were analyzed with a 36 element geochemical procedure
and gold Fire Assays was conducted where warranted.
The 2006
field program and sampling was under the direct supervision of Bruce Goad, P.
Geo., a Qualified Person under the applicable Canadian disclosure regulations
for mineral exploration companies. No exploration programs were
undertaken during either 2007 or 2008. A follow-up exploration
program is currently being planned for both concession areas, to be undertaken
during 2009.
Significant
results are presented in table format below.
The
Penthouse Prospect covers a large, structurally controlled, 3 kilometre long
zone of sheared and brecciated siliceous basalts and sediments that may be
directly analogous to the nearby ULU Deposit. Arsenopyrite
mineralization has been identified within a 500 metre wide by 2,700 metre long
area proximal to volcanic-sediment contacts.
The
results to date strongly suggest the need for follow up drill
investigation. These surface results will be combined with proposed
geophysical survey data to form the basis for new drill targets to be explored
during 2009.
Significant
results are presented in table format below.
These
samples were collected over an area measuring 400 metres by 800 metres. The
North Fold Nose zone is located approximately 3 km north of the ULU deposit and
is thought to be part of the same major fold structure which hosts the ULU
deposit.
With the
use of recent airborne geophysical surveys and new structural data, Golden River
Resources has outlined numerous zones of banded iron formations with strike
lengths of over several kilometres on the Contwoyto concessions.A total of 381
samples were collected from the six Contwoyto concession subsections. To date
the scope of work has been limited to a more regional nature in this area. The
majority of the best values (between 600 and 14,000 ppb gold) come from folded
and faulted deformation zones within several of the iron formation horizons. The
size and nature of at least these areas appear similar to the nearby Lupin Mine.
Several new claims were staked over some of the most promising areas. Further
detailed work is required over the principle areas of the Contwoyto
concession.
The
Contwoyto IOL Concessions:
Numerous
new zones of banded iron formations were identified and sampled during past GRR
exploration programs. Principle areas within the property include
thick sequences of banded iron formation with strike lengths of over several
kilometres. With the use of recent airborne geophysical surveys and
structural data, Golden River has outlined favourable gold-bearing deformation
zones within the iron formation units that appear to have similarities to those
identified at the nearby Lupin Mine.
During
2006, a total of 381 samples were collected from the six Contwoyto Concession
subsections. To date, the scope of work has been limited to a more
regional nature in this area. The majority of the best values
(between 600 and 14,000 ppb gold) come from folded and faulted deformation zones
within several of the iron formation horizons. The size and nature of
at least these areas appear similar to the nearby Lupin Mine. Further
detailed work is required over the principle areas of the Contwoyto concession
including proposed ground geophysical surveys and geological
mapping.
Golden
River remains very encouraged by the 2004 and 2006 exploration programs which
were successful in finding new locations of strong
mineralization. Following these initial field investigation programs,
the characteristics and gold-bearing potential of the Hood and Contwoyto IOL’s
are better understood. Subsequent to the acquisition of the results
of a proposed geophysical program to be undertaken within both areas, it is
expected that additional quality drill targets will be identified.
Committee
Bay Greenstone Belt Properties
In June
2002, highly prospective ground within the Committee Bay Greenstone Belt
(“CBGB”) was selected and staked on behalf of the Company. Golden
River Resources owns 100 percent interest of its Committee Bay Area
Properties. All claims are on federally owned ground and mineral
title is administered by the federal government.
The
Committee Bay Greenstone Belt is located approximately 240 kilometres northeast
of Baker Lake in Nunavut, Canada and is believed to represent the largest
under-explored greenstone belt in North America, with potential to host
world-class gold deposits.
The
geology is highly prospective for banded iron formation hosted gold
mineralization (as in the 3 million ounce Meadowbank and the 4.6 million ounce
Meliadine gold deposits located to the south of the properties, north the
hamlets of Baker Lake and Rankin Inlet, respectively). The Golden
River Resources (through Golden Bull Resources, a 100 percent subsidiary of
Golden River Resources) Properties protect several auriferous iron
formations. In addition to the banded iron formation (“BIF”) hosted
gold targets, this belt has potential for shear-hosted lode gold,
Witswaterstrand-style gold, komatiite-hosted stratiform-nickel-copper (Kambalda
analogy), and platinum group elements (“PGE’s”) occurring in layered igneous
complexes (Laughland Lake Anorthosite Suite).
Originally
29 properties were staked comprising a land area of 71,694 acres in the
Committee Bay Greenstone Belt in central Nunavut, Canada. These
properties were recorded on October 16, 2002. From the original area the company
retained a total of 49,815.9 acres on 22 claims which comprise 10 individual
properties. To maintain the properties in good standing, the company was
required to spend a total of CDN$197,798 of assessment work by October 16, 2004.
A total of CDN$98,879 (CDN$2 per acre) is required in each subsequent year up to
2012 (at which point a decision to bring the properties to lease must be
made). During the 2004 field season, the company spent CDN$1.567
million on exploration and all amounts in excess of the 2004 commitment were
applied to offset against future assessment commitments. As a result
of the amount the company spent during 2004, it has already met the expenditure
commitments until 2010 for some properties and to 2012 for most
others. A list of the mining properties in the Committee Bay
Greenstone Belt is included as Appendix B to this Annual Report.
Location
The
Committee Bay Claims are located 245 to 365 kilometres northeast of the hamlet
of Baker Lake (Qamani’tuaq), Nunavut, Canada, or 210 to 320 kilometres west to
southwest of the hamlet of Repulse Bay (Naujat). The remote community
of Kugaaruk (formerly Pelly Bay) is 190 to 305 kilometres northeast of the claim
groups. The company’s land holdings in the Committee Bay Greenstone
Belt include 22 properties in 10 claim blocks. These properties total
approximately 49,815.9 acres and all were recorded on October 16,
2002. The sole exception to this is the GB 1 Claim which was recorded
on September 13, 2004. There are no known encumbrances on any of the
Company’s properties.
 Figure
5. – Location of Committee Bay Area Properties
Access,
Infrastructure, Local Resources
Access to
the properties is by fixed wing aircraft. Alternatively, float equipped planes
have the option of landing at some of the larger lakes (Laughland Lake, Walker
Lake, etc.) or on sections of the Hayes River. Helicopter support is
required to mobilize personnel from camp to the property areas.
The
Committee Bay Greenstone Belt lies within the zone of permafrost. The mean
annual temperature of -20oC reflects its Arctic location (the Arctic Circle
transects the property area). The climate is typical of the Eastern
Arctic with average temperatures in the winter months of -30oC to -35oC, and
+10oC to +12oC in the summer. The ground remains snow covered for
more than 250 days a year (generally September to June). Rivers break
up in June and lakes are generally ice bound until mid July.
The
project area is on the northern section of the Wager Plateau, a shield area that
has been significantly modified by glacial processes. Elevations
range from 122 metres above sea level in the southwest to 560 metres above sea
level in the northeast.
The
closest community with regularly scheduled air service is Baker Lake, about 350
kilometres to the southwest. Canadian North and First Air flights arrive from
Yellowknife and Iqaluit. Calm Air flies from Winnipeg to Rankin Inlet
(Kangiqliniq) and then on to Baker Lake daily except
Sundays. Kivalliq Air flies from Cambridge Bay (Qaluktuuttiaq) to
Baker Lake enroute to Rankin Inlet. Fuel and expediting services are
available in Baker Lake or Rankin Inlet. There is no infrastructure
in the claim area. Committee Bay Resources maintains the Hayes River
field camp which seasonally services their Three Bluffs Deposit. A
winter airstrip and fairly regular supply flights generally
service this site.
Property
History
All
previous work reported by companies is quoted from open file government
assessment reports.
Following
the release of Heywood’s original geology map of the area in 1961, several
exploration companies performed work within the Committee Bay Greenstone
Belt. The nickel-copper potential of ultramafic rocks was the primary
target of this first exploration wave. Between 1969 and 1970,
explorers mapped, sampled and conducted limited geophysical surveys on areas now
covered by the company’s current “AA” and “EE” Properties. This
historical program outlined several electromagnetic conductors to be coincident
with surface mineralization. The best trenched nickel value occurred
on the “EE” Property within a 1.46 kilometre long conductor.
Further
exploration was undertaken during the general nickel-copper reconnaissance
between 1970 and 1974 and more detailed work followed in 1975 and again in
1976. Geologic mapping, ground magnetic and EM surveys were conducted
in the Hayes River Area. Although prospective rock units carrying
nickel and copper values were identified, no further follow up work was
recommended.
In 1986,
reconnaissance rock samples were taken from within the area currently held by
the company’s Pickle Property.
Southwest
of the central tonalite, in the area of the company’s Pickle Property, several
permits were granted to the Committee Bay Joint Venture (CBJV) in
1993. Sampling by CBJV returned gold values in sheared, banded iron
formation which hosted pyrite +/- arsenopyrite
mineralization. Although CBJV’s Pickle 1 Claim was staked in 1995, no
follow-up work was reported. The airborne magnetic expression of the iron
formation at this site is 70–100 metres thick and traceable intermittently on
surface for 1.35 kilometres.
In 1992,
reconnaissance sampling in the Committee Bay Area was undertaken on behalf of
the CBJV. Several highly anomalous gold values were returned from
rock samples taken by field crews. Follow-up work was performed in
1993. High gold values corresponded to samples of banded iron
formation containing quartz veining and/or silicification and pyrite,
pyrrhotite, (±) arsenopyrite mineralization. In 1995, additional rock
samples were obtained, and eight drill holes totaling 811.41 metres were
completed. This work exclusively focused on the Bluff Claims in Hayes
River Area and the Inuk Area located further to the northeast. In 1996, the CBJV
flew a 13,262 line-kilometre detailed geophysical survey (magnetics and VLF),
collected additional rock samples and drilled 6 diamond drill holes at Three
Bluffs. Approximately CDN$5.4 million was collectively spent on the
Committee Bay Greenstone Belt between 1992 and 2001 by
explorers. This exploration focused on three areas: Laughland Lake,
Hayes River and Curtis River.
Numerous
gold occurrences were discovered by the CBJV between 1992 and
2001. Of particular note are the Pickle, Four Hills, Cop, Ghost
Coyote, Ridge, Bluff Group and West Plains Prospects.
The
company’s five Wrench Claims which comprise the Wrench Property were previously
within prospecting permits granted to the CBJV in 1994. Reconnaissance sampling
by the CBJV returned a series of gold anomalies over a distance of approximately
three kilometres and all located within sheared, oxide banded, iron formation in
their northern part of their adjacent BLUFF Claim Block.
The
Committee Bay Greenstone Belt was the subject of two separate 3 year (2000-2003)
government Targeted Geoscience Initiatives (“TGI”). These TGIs
consisted of a collaboration among the Geological Survey of Canada,
Canada-Nunavut Geoscience Office and university partners. The stated
objective of the TGI was to increase the level and cost-effectiveness of private
sector exploration for mineral resources within the Committee Bay Greenstone
Belt. Government work in the Committee Bay Greenstone Belt included
1:100,000 scale geologic mapping, prospecting, surficial mapping, drift
prospecting, and airborne geophysical surveys. Airborne magnetic
surveys (400 metre flight line spacing) were carried out and released as total
field maps in 2002. Quaternary research involved multimedia sampling
for gold and base metals and this drift prospecting/sampling was carried out
between 2001 and 2003.
The
government aeromagnetic survey shows a northeast continuation of the Three
Bluffs iron formation for at least three kilometres onto the Golden River
(through a 100 percent ownership of its subsidiary Golden Bull Resources) Wrench
properties. Government sampling in 2001 on this trend, eastward from the Three
Bluffs Deposit, returned gold intersections from sulphide-bearing (pyrite +
pyrrhotite), quartz-veined intervals of oxide banded iron formation within the
area currently covered by the boundaries of the company’s Wrench
Property.
Numerous
other prospective gold targets within the greenstone belt (West Plains, Four
Hills, Coyote, etc) are the subject of ongoing investigation by Committee Bay
Resources Limited (“CBR”). For the most part, the mineral properties
of Golden River Resources either border on, or are along strike of, an adjacent
CBR Prospect.
Geologic
Setting
The Prince
Albert Group (“PAG”) incorporates a series of Archean-aged greenstone belts that
stretch approximately 600 kilometres northeast from the Aylmer Shear Zone in the
south to the eastern tip of Melville Peninsula in the north. A
300 kilometres long section southwest of Committee Bay is referred to as the
Committee Bay Greenstone Belt.
The
stratigraphy of the Committee Bay Greenstone Belt includes banded iron formation
up to 50 metres thick, komatiite volcanic flows, basalts, intermediate to felsic
tuffs, and quartz-cobble conglomerates. Deformation is recorded by major shear
zones, second order faults, complex folding, and felsic
intrusions. Numerous gold prospects are spread out over a 260 x 40
kilometre area including CBR’s Inuk Zone in northeast Committee Bay and their
Three Bluffs Zone in the Hayes River Area.
The
approximate age of the Committee Bay Greenstone Belt ranges from 2.718 billion
years to 2.732 billion year old. Younger plutonic intrusions include the 1830
Million year old Hudson monzo-granites. Laterally continuous,
northeast-trending, quartz-feldspar porphyry dykes, 0.5 metre to 10 metre wide,
are traceable for hundreds of metres in the Three Bluffs Area. Age
dates for these porphyry dykes are not currently available.
Prospects
The
Committee Bay Greenstone Belt appears to have the potential to host a number of
mineral deposit types including banded iron formation hosted gold, shear-hosted
lode gold, komatiite hosted, stratiform, nickel-copper (Kambalda analogy)
mineralization, and platinum group elements in layered igneous
complexes.
Examples
of iron formation-hosted gold mineralization include the company’s Wrench
Property where government sampling in 2001 returned gold intersections from
sulphide-bearing (pyrite + pyrrhotite), quartz-veined intervals of oxide banded
iron formation. This section of anomalous, gold-bearing iron
formation is over 6.5 kilometres long and includes not only the CBR Three Bluff
occurrence but also the company’s adjacent Wrench Claim Block.
Other iron
formation-hosted gold examples include mineralization on the company’s Pickle
Property. The gold values are found in sulphide-rich sections
(arsenopyrite and pyrite) of the sheared, oxide + silicate facies banded iron
formation. The airborne magnetic expression of the iron formation at
this site is 70–100 metres thick and traceable intermittently on surface for
1.35 kilometres.
In
addition, gold values in iron formation are also found on the Company’s NN1 and
NN2 Properties.
An example
of shear-hosted, gold mineralization in the Committee Bay Greenstone Belt is
CBR’s Coyote Prospect where high-grade gold values were returned from an
intensely sheared gabbro with quartz veins, pyrite + pyrrhotite + chalcopyrite +
visible gold. The hosting structure is a splay off the east-west
Walker Lake Shear Zone and is a classic setting for shear-hosted
gold. Through Golden Bull Resources, Golden River Resources holds
title to a claim immediately adjacent to either side of the Coyote Claim
Prospect. Rock exposure on these claims is extremely
limited.
Komatiite-hosted
(Kabalda-style) nickel potential exists on the company’s EE Property (EE 1-3
Claims). These properties cover anomalous nickel values spread over
930 metres along a contact between a thick ultramafic body and
sediments. Elevated copper values were also reported in
samples. A second ultramafic/sediment contact on the western edge of
the western EE Claim also has anomalous nickel over a similar strike
length. The folded stratigraphy in the centre of the EE Property is
also appears to have the potential to host gold mineralization but exposure is
somewhat limited in this area.
The
Laughland Lake Anorthosite Suite (“LLAS”) also has good PGE-hosting
potential. Although the company has no claims in the area, rusty
zones defined by sulphide gossans of up to 100 metres wide and 500 metres long
have been reported in this area. Moderately anomalous platinum,
palladium nickel and copper values have been reported from sampling of these
zones.
Work
Program
A total of
CDN$1.567 million was spent on the company’s Committee Bay Greenstone Belt 2004
program. A large portion of the expense went to establishing a re-usable
base-camp into this extremely remote location. All field, office, and
camp supplies, as well as fuel, were flown in to a tiny island at the north end
of Walker Lake upon which the base camp had been established. All
subsequent field activities were helicopter supported.
The 2004
exploration program began in late May with a geophysical program on the Wrench
Property. This is covered in the “Geophysical Surveys”
section. Subsequently, between June 2004 and early September 2004, a
regional, grassroots-type prospecting/mapping program was undertaken to explore
all of the company’s mineral properties in the Committee Bay Greenstone
Belt. Each of the 22 claim blocks which comprise the company’s 10
properties holds significant mineralization. In some localities
outcrop was not abundant or even observed; however, many of the claim sites were
selected to cover key magnetic anomalies identified from the government regional
airborne survey.
A total of
1,476 rock samples were removed and analyzed from the company’s 22 existing
mineral claims. In addition, a small soil grid was established on the
Wrench Property and 658 soil samples were collected. Anomalous gold
values were returned from sampling on several of the claim areas. Of
particular note were the results from the company’s Wrench Property which cover
an area adjacent to the CBR’s Three Bluffs Deposit. This property was
found to exhibit identical structures and lithologies as to those CBR has
identified on their adjacent Three Bluffs Property. Sampling along
exposed banded iron formation produced high gold values within the 1.5 kilometre
strike length of the targeted iron formation horizon.
Geophysical
Surveys
The entire
Committee Bay Greenstone Belt Area has been covered by governments 400 metre
flight-line spacing airborne magnetic surveys to produce map coverage at a scale
of 1:100,000. These surveys identity areas where linear magnetic
anomalies exist: generally linear magnetic anomalies reflect underlying magnetic
banded iron formation. This was undertaken as part of the government
TGI initiative. To date the company’s Wrench Property is the only
area that has been subjected to ground geophysical surveys.
Wrench
Property
An eighty
six-line grid was established over the Wrench Claims by Aurora Geosciences Ltd.
of Yellowknife, NWT. Grid point control was accomplished using GPS
technology. Lines were spaced every one hundred metres and in total
the grid was comprised of 176.46 line kilometres. Subsequently, two
geophysical surveys were undertaken. Total field magnetic surveying
was carried out with readings obtained at 6.25 metre
stations. Horizontal loop electromagnetic (HLEM) surveying was also
undertaken. Readings for this survey were spaced at twenty five metre
intervals.
The Wrench
Claim Group comprises five contiguous properties covering approximately 4,900
hectares. A government aeromagnetic survey confirms that the Wrench iron
formation is directly connected with, and along strike from, CBR’s Three Bluffs
iron formation-hosted gold deposit.
The
geophysical program served a number of purposes. The magnetic survey
accurately traced the iron formation and delineated important structural
information such as faulting and folding. The HLEM component
highlighted where the conductive pyrrhotite-rich sections of the iron formation
are located and, in conjunction with the magnetic surveys, define potential
trenching and drill targets.
The
magnetic survey outlined a strong, six kilometre long, northeast-trending,
magnetic anomaly along that exists along the western half of the
grid. In the southeastern portion of the grid, two additional strong,
parallel, magnetic anomalies were also recorded. The HLEM survey
outlined 17 distinct conductive trends/anomalies, most of which are coincident
with, or flank, very strong magnetic features.
Field
verification of the magnetic anomalies indicated that the magnetic anomalies are
a result of the presence of continuous banded iron formation units that underlie
the grid area.
Proposed
Work
We did not
conduct any exploration activities on our Committee Bay prospects during fiscal
2008 as we concentrated our efforts on our Slave craton prospects.
The large
assessment credit excess accrued as a result of the 2004 program that was
applied toward the claims allowed the company to meet its expenditure
commitments until 2012 for most properties (see Appendix B). However,
as a result of the high gold potential of the claims and exploration interest in
the Committee Bay Greenstone Belt, further work is being planned.
Future
exploration programs will involve additional ground geophysical surveys,
geologic mapping, prospecting, sampling, and drilling. Identification
and definition of drill targets will be the primary objective.
Four areas
already present themselves as obvious drill targets:
The
company has not scheduled the timing of these future exploration activities,
which will depend on the availability of funds and ongoing developments on its
Slave Craton Prospects.
Regulation
Mining
in Canada
The mining
industry in Canada operates under both federal and provincial or territorial
legislation governing the exploration, development, production and
decommissioning of mines. Such legislation relates to the method of acquisition
and ownership of mining rights, labour, health and safety standards, royalties,
mining and income taxes, exports, reclamation and rehabilitation of mines, and
other matters. The mining industry in Canada is also subject to legislation at
both the federal and provincial or territorial levels concerning the protection
of the environment. Legislation imposes high standards on the mining industry to
reduce or eliminate the effects of waste generated by extraction and processing
operations and subsequently deposited on the ground or emitted into the air or
water. The design of mines and mills, and the conduct of extraction and
processing operations, are subject to the regulatory restrictions. The
exploration, construction, development and operation of a mine, mill or refinery
require compliance with environmental legislation and regulatory reviews, and
the obtaining of land use and other permits, water licenses and similar
authorizations from various governmental agencies. Legislation is in place for
lands under federal jurisdiction or located in certain provinces and territories
that provide for the preparation of costly environmental impact assessment
reports prior to the commencement of any mining operations. These reports
require a detailed technical and scientific assessment as well as a prediction
of the impact on the environment of proposed mine exploration and
development.
Failure to
comply with the requirements of environmental legislation may result in
regulatory or court orders being issued that could result in the cessation,
curtailment or modification of operations or that could require the installation
of additional facilities or equipment to protect the environment. Violators may
be required to compensate those suffering loss or damage by reason of mining
activities and the violators, including our officers and directors, may be fined
or, in some cases, imprisoned if convicted of an offence under such
legislation. Provincial and territorial mining legislation
establishes requirements for the decommissioning, reclamation and rehabilitation
of mining properties that are closed. Closure requirements relate to the
protection and restoration of the environment and the protection of public
safety. Some former mining properties must be managed for a long time following
closure in order to fulfill regulatory closure requirements. The cost of closure
of existing and former mining properties and, in particular, the cost of
long-term management of open or closed mining properties can be
substantial.
Government
Regulations
We are
committed to complying and, to our knowledge, are in compliance with all
governmental and environmental regulations. Permits from a variety of regulatory
authorities are required for many aspects of mine operation and reclamation. Our
exploration work is subject to the Mining Land Use Regulations of the Indian and
Northern Affairs Canada Mining Act. This Act requires us to obtain permits prior
to performing significant exploration programs.
We cannot
predict the extent to which future legislation and regulation could cause
additional expense, capital expenditures, restrictions, and delays in the
development of our Canadian properties, including those with respect to mining
properties. Our activities are not only subject to extensive federal, provincial
and local regulations controlling the mining of and exploration for mineral
properties, but also the possible effects of such activities upon the
environment. We will be obligated to take steps to ensure that such
streams draining the property do not become contaminated as a result of our
activities on the property. We are not aware of any environmental problems on
the property as of the date of this filing.
The mining
industry in Nunavut, where our exploration properties are situated, operates
under Canadian federal and territorial legislation governing prospecting,
development, production, environmental protection, exports, income taxes, labour
standards, mine safety and other matters. We believe our Canadian
operations are operating in substantial compliance with applicable
law.
Our
exploration works is subject to environmental regulation primarily by the
Federal Department of Indian Affairs and Northern Development and the Nunavut
Water Board. The Department of Fisheries & Oceans (Canada) and
the Department of the Environment (Canada) have an enforcement role in the event
of environmental incidents, but presently have no direct regulatory role in
relation to exploration activity.
On April
1, 1999, the Nunavut Land Claims Agreement, dated May 28, 1993, between the
Inuit of Canada’s eastern arctic region and Her Majesty the Queen in right of
Canada, came into force. Under this agreement, the Inuit were granted ownership
of approximately 360,000 square kilometers of land in an area referred to as the
Nunavut Settlement Area, including ownership of subsurface rights in
approximately 37,500 square kilometers of those lands. Third party
interests in lands in the Nunavut Settlement Area created prior to April 1, 1999
are protected under the Nunavut Land Claims Agreement. Where a third
party was granted a mining lease under the Canada Mining Regulations in lands
comprising the Nunavut Settlement Area, that interest continues in accordance
with the terms and conditions on which it was granted, including any rights
granted under the legislation that give rise to the
interest. However, where any successor legislation has the effect of
diminishing the rights afforded to the federal government, it will not bind the
Inuit without its consent. The Inuit are entitled to receive whatever
compensation is payable by the interest holder for the use of exploitation of
mineral rights. The federal government continues to administer the
third party interest on behalf of the Inuit, unless the third party and the
Inuit enter into an agreement under which the third party agrees to the
administration of their interest by the Inuit. In the event such an
agreement is reached, the applicable legislation will cease to apply to the
third party interest. Subsurface interests in such lands continue to
be administered in accordance with applicable legislation relating to those
interests and are not affected by the Nunavut Land Claims
Agreement.
Third
party interests in lands in the Nunavut Settlement Area created on or after
April 1, 1999 are granted, in the case of surface rights, by the appropriate
regional Inuit association and, in the case of subsurface rights, by Nunavut
Tungavik Incorporated which will hold subsurface title to Inuit owned lands and
will be additionally responsible, in consultation with the appropriate regional
Inuit associations, for the administration and management of those subsurface
rights.
Government
Requirements for Maintenance of Claims
The
regulations governing the requirements for the maintenance of claims is
dependant upon whether the claims are within a federal jurisdiction of if they
are located on ground that is controlled by the NTI under the Nunavut Land
Claims Agreement.
Within
The Slave Craton:
Tahera
controlled mineral properties within the Slave Craton fall under the
jurisdiction of both the Federal government and the Nunavut Land Claims
Agreement. Fees and exploration expenditures associated with the
maintenance of Tahera Corporation’s ground covered under the Slave Craton
Agreement with Golden River Resources is the responsibility of Tahera Diamond
Corporation.
Within
The Committee Bay Greenstone Belt:
The
Nunavut Government has granted the company interest in the 22 mineral claims
which comprise 10 distinct mineral properties in the Committee Bay Greenstone
Belt described in this report. All claims fall under the jurisdiction
of Federal regulations.
To keep
the existing 22 claims in good standing, the company was required to spend a
total of CDN$197,798 of qualifying assessment work by October 16, 2004.
Assessment work must be filed with the Mining Recorder within 30 days of the
claim’s anniversary date or within 60 days of the lapsing notice
date.
A total of
CDN$98,879 (CDN$2 per acre) is required in each subsequent year up to 2012 (at
which point a decision to bring the properties to lease must be
made).
In 2004
the company spent a total of CDN$1,566,962 of on its Committee Bay Area
Properties. All assessment work was filed and the excess of
CDN$1,369,164 was used to offset the expenditure (assessment) requirement due in
following years. As a result the company has already met its
assessment expenditure commitments until 2012 for most properties (for a
detailed listing, see Appendix B).
Employees
We use
temporary employees in our field exploration programme. The services
of our Chief Executive Officer, Joseph Gutnick and Chief Financial Officer and
Secretary, Peter Lee, as well as clerical employees are provided to us on a
part-time as needed basis pursuant to a Service Agreement dated November 25,
1988 (the “Service Agreement”) between us and AXIS Consultants Pty Limited
(“AXIS”). AXIS also provides us with office facilities, equipment,
administration and clerical in Melbourne Australia pursuant to the Service
Agreement. The Service Agreement may be terminated by written notice by either
party.
Other than
this, we rely primarily upon consultants to accomplish our exploration
activities. We are not subject to a union labour contract or collective
bargaining agreement.
Item 1A Risk Factors
You should
carefully consider each of the following risk factors and all of the other
information provided in this Annual Report before purchasing our common
stock. An investment in our common stock involves a high degree of
risk, and should be considered only by persons who can afford the loss of their
entire investment. The risks and uncertainties described below are not the only
ones we face. There may be additional risks and uncertainties that are not known
to us or that we do not consider to be material at this time. If the events
described in these risks occur, our business, financial condition and results of
operations would likely suffer. Additionally, this Annual Report contains
forward-looking statements that involve risks and uncertainties. Our actual
results may differ significantly from the results discussed in the
forward-looking statements. This section discusses the risk factors that might
cause those differences.
Risk
Factors
Risks
of Our Business
We
Lack an Operating History And Have Losses Which We Expect To Continue Into the
Future.
To date we
have no source of revenue. We have no operating history as a mineral exploration
or mining company upon which an evaluation of our future success or failure can
be made. Our ability to achieve and maintain profitability and positive cash
flow is dependent upon:
We
Have No Known Gold Or Other Mineral Reserves And We Cannot Assure You That We
Will Find Such Reserves. If We Develop A Gold Or Other Mineral Reserve, There Is
No Guarantee That Production Will Be Profitable.
We have
not identified any gold or other commercial mineral reserves on the properties
covered by our mineral claims and we cannot guarantee we will ever find
any. Also, to the extent that commercial mineral reserves have been
identified by other companies on properties that are adjacent to or within the
same geographic region as our exploration properties, this does not mean that we
will be successful in identifying commercial mineral reserves on our properties.
Even if we find a gold or other commercial minerals reserve, there is no
assurance that we will be able to mine them. Even if we develop a mine, there is
no assurance that we will make a profit. If we do not find gold or other
commercial minerals you could loose part or all of your investment.
We
Will Need Additional Financing To Determine If There Is Gold Or Other Commercial
Minerals And To Maintain The Mineral Claims.
Our
success will depend on our ability to raise additional capital. We have met our
legal exploration commitments on the Committee Bay Properties until 2012 and
Tahera is required to fulfill the minimum exploration commitments on the Slave
Properties. However, at this time, we have not found a gold deposit
and further exploration is required. There is no assurance whatsoever
that funds will be available from any source or, if available, that they can be
obtained on terms acceptable to us to make these investments. If funds are not
available in the amounts required to maintain an interest, we will be unable to
proceed further on the Committee Bay Properties and Slave Properties and our
operations would be severely limited, and we would be unable to reach our
objective. This could cause the loss of all or part of your
investment.
There
Are Risks Associated With Our Agreement With Tahera
In June
2008 the Company agreed on terms with Tahera to take full control of the
properties listed in the 2002 Tahera/GRR agreement. At the date of this filing
the agreement transferring control of the properties had not been executed, and
until it is finalized the Company will ensure all other Tahera related
agreements remain current. The agreement with Tahera dated March 7, 2002 gives
us rights of access to exploration data of Tahera covering gold, silver and base
metal potential on properties held by Tahera or properties which are adjacent to
or in the area of the Tahera properties. If during our exploration for gold,
silver or base metals, we discover diamonds, Tahera retains the rights to the
diamonds. Under the agreement, if we wish to conduct exploration on
the properties, we need to seek access to the properties and enter into an
access agreement with Tahera, suitable to Tahera, which sets out the terms of
our access. Our access cannot interfere with Tahera’s operations on the
properties. Tahera has the sole and unfetted discretion to sell, transfer,
assign, encumber, mortgage, pledge, hypothecate, allow to lapse, forfeit,
surrender or in any way dispose of its interest in the properties. If Tahera
were to sell, transfer or assign the properties, we would have to negotiate
access with the new owners of the properties and there can be no assurance we
would receive access. We undertake exploration at our sole risk. Subject to
Tahera’s rights, we have the right to exploit opportunities for gold, silver or
base metals on the properties. We have granted Tahera a 2% net
smelter return royalty.
On January
16, 2008, Tahera Diamond Corporation obtained an order from the Ontario Superior
Court granting it protection pursuant to the provisions of the Companies’
Creditors Arrangement Act (“CCAA”) for 30 days, with subsequent extensions to
November 30, 2008.
In June
2008, the Company agreed on terms with Tahera Diamond Corporation to obtain full
control of the mining properties that are listed in the Tahera/GRR agreement
through the issuance of 3,000,000 shares of common stock, but final agreements
have not been executed, as at October 10, 2008.
The
Report Of Our Independent Registered Public Accounting Firm Contains An
Explanatory Paragraph Questioning Our Ability To Continue As A Going
Concern.
The report
of our independent registered public accounting firm on our consolidated
financial statements as of June 30, 2008 and for the years ended June 30, 2008
and 2007 and for the period July 1, 2002 (inception of exploration stage)
through June 30, 2008 includes an explanatory paragraph questioning our ability
to continue as a going concern. This paragraph indicates that we have
not yet commenced revenue producing operations and have a retained deficit of
A$37,109,000 which conditions raise substantial doubt about our ability to
continue as a going concern. Our consolidated financial statements do
not include any adjustment that might result from the outcome of this
uncertainty.
We
Are A Small Operation And Do Not Have Significant Capital.
Because we
will have limited working capital, we must limit our exploration. If we are
unable to raise the capital required to undertake adequate exploration, we may
not find gold or other commercial minerals even though our property may contain
gold or other commercial minerals. If we do not find gold or other commercial
minerals we may be forced to cease operations and you may lose your entire
investment.
We
May Not Find Any Ore Reserves That Are Economical
If we are
unable to raise the required capital or we do not find gold or other commercial
minerals on the properties or we cannot remove the gold or other commercial
minerals discovered economically, we may have to look for other mineral rights
on other properties in Canada or other parts of the world. Alternatively, we may
cease operations altogether and you may lose your entire
investment.
Weather
Interruptions In Nunavut May Affect And Delay Our Proposed Exploration
Operations.
We can
only work above ground at our mineral claims in Nunavut, Canada from late May
until early October and from mid December to March of each year. Once we are
able to work underground, we plan to conduct our exploration year round,
however, it is possible that snow or rain could cause roads leading to our
claims to be impassible. This could impair our ability to meet our objectives
and may increase our costs beyond our ability, if any, to secure financing,
which would adversely affect the value of your investment and our ability to
carry on business.
If
Our Officers And Directors Stopped Working For Us, We Would Be Adversely
Impacted.
None of
our other officers or directors works for us on a full-time basis. There are no
proposals or definitive arrangements to compensate our officers and directors or
to engage them on a full-time basis. They each rely on other business activities
to support themselves. They each have a conflict of interest in that they are
officers and directors of other companies. You must rely on their skills and
experience in order for us to reach our objective. We have no employment
agreements or key man life insurance policy on any of them. The loss
of some or all of these officers and directors could adversely affect our
ability to carry on business and could cause you to lose part or all of your
investment.
We
Could Encounter Delays Due To Regulatory And Permitting Delays.
We could
face delays in obtaining mining permits and environmental permits. Such delays,
could jeopardize financing, if any, in which case we would have to delay or
abandon work on the properties.
Gold
Price Fluctuations.
If we are
successful in developing a gold ore reserve, our ability to raise the money to
put it into production and operate it at a profit will be dependant on the then
existing market price of gold. Declines in the market prices of gold may render
reserves containing relatively low grades of ore uneconomic to exploit, and we
may be required to discontinue exploration, development or mining on the
properties, or write down our assets. If the price of gold is too low we will
not be able to raise the money or produce any revenue. We cannot
predict the future market price of gold. A sustained decline in the market price
of gold could cause a reduction in the value of your investment and you may lose
all or part of your investment.
There
Are Uncertainties Inherent In The Estimation Of Gold Or Other Mineral
Reserves.
Based upon
our preliminary study of the properties we believe that the potential for
discovering gold reserves exists, but we have not identified such gold reserves
and we are not able to estimate the probability of finding recoverable gold ore.
Such estimates cannot be calculated from the current available information.
Reserve estimates, including the economic recovery of gold ore, will require us
to make assumptions about recovery costs and gold market prices. Reserve
estimation is, by its nature, an imprecise and subjective process and the
accuracy of such estimates is a function of the quality of available data and of
engineering and geological interpretation, judgment and experience. The economic
feasibility of the properties will be based upon our estimates of the size and
grade of ore reserves, metallurgical recoveries, production rates, capital and
operating costs, and the future price of gold. If such estimates are incorrect
or vary substantially it could effect our ability to develop an economical mine
and would reduce the value of your investment.
If
We Define An Economic Ore Reserve And Achieve Production, It Will Decline In The
Future. An Ore Reserve Is A Wasting Asset.
Our future
ore reserve and production, if any, will decline as a result of the exhaustion
of reserves and possible closure of any mine that might be
developed. Eventually, at some unknown time in the future, all of the
economically extractable ore will be removed from the properties, and there will
be no ore remaining. This is called depletion of reserves. Ultimately, we must
acquire or operate other properties in order to continue as an on going
business. Our success in continuing to develop reserves, if any, will affect the
value of your investment.
There
Are Significant Risks Associated With Mining Activities.
The mining
business is generally subject to risks and hazards, including quantity of
production, quality of the ore, environmental hazards, industrial accidents, the
encountering of unusual or unexpected geological formations, cave-ins, flooding,
earthquakes and periodic interruptions due to inclement or hazardous weather
conditions. These occurrences could result in damage to, or destruction of, our
mineral properties or production facilities, personal injury or death,
environmental damage, reduced production and delays in mining, asset
write-downs, monetary losses and possible legal liability. We could incur
significant costs that could adversely affect our results of
operation. Insurance fully covering many environmental risks
(including potential liability for pollution or other hazards as a result of
disposal of waste products occurring from exploration and production) is not
generally available to us or to other companies in the industry. What liability
insurance we carry may not be adequate to cover any claim.
We
Are Subject To Significant Environmental And Other Governmental Regulations That
Can Require Substantial Capital Expenditure, And Can Be
Time-Consuming.
We are
required to comply with various Canadian laws and regulations pertaining to
exploration, development and the discharge of materials into the environment or
otherwise relating to the protection of the environment, all of which can
increase the costs and time required to attain operations. We will have to
obtain exploration, development and environmental permits, licenses or approvals
that may be required for our operations. There can be no assurance that we will
be successful in obtaining, if required, a permit to commence exploration,
development and operation, or that such permit can be obtained in a timely
basis. If we are unsuccessful in obtaining the required permits it may adversely
affect our ability to carry on business and cause you to lose part or all of
your investment.
Mining
Accidents Or Other Adverse Events At Our Property Could Reduce Our Production
Levels.
If and
when we reach production it may fall below estimated levels as a result of
mining accidents, cave-ins or flooding on the properties. In addition,
production may be unexpectedly reduced if, during the course of mining,
unfavorable ground conditions or seismic activity are encountered, ore grades
are lower than expected, or the physical or metallurgical characteristics of the
ore are less amenable to mining or processing than expected. The happening of
these types of events would reduce our profitably or could cause us to cease
operations which would cause you to lose part or all of your
investment.
The
acquisition of gold mineral properties is subject to substantial competition. If
we must pursue alternative properties, companies with greater financial
resources, larger staffs, more experience, and more equipment for exploration
and development may be in a better position than us to compete for properties.
We may have to undertake greater risks than more established companies in order
to compete which could affect the value of your investment.
We
are substantially dependent upon AXIS To Carry Out Our Activities
We are
substantially dependent upon AXIS for our senior management, financial and
accounting, corporate legal and other corporate headquarters
functions. For example, each of our officers is employed by AXIS and,
as such, is required by AXIS to devote substantial amounts of time to the
business and affairs of the other shareholders of AXIS.
Pursuant
to a services agreement, AXIS provides us with office facilities, administrative
personnel and services, management and geological staff and
services. No fixed fee is set in the agreement and we are required to
reimburse AXIS for any direct costs incurred by AXIS for us. In
addition, we pay a proportion of AXIS indirect costs based on a measure of our
utilization of the facilities and activities of AXIS plus a service fee of not
more than 15% of the direct and indirect costs. AXIS has charged us a service
fee of 15% for this fiscal year. This service agreement may be terminated by us
or AXIS on 60 days’ notice. See “Certain Relationships and Related
Party Transactions.”
Future
Sales of Common Stock Could Depress The Price Of Our Common Stock
Future
sales of substantial amounts of common stock pursuant to Rule 144 under the
Securities Act of 1933 or otherwise by certain stockholders could have a
material adverse impact on the market price for the common stock at the
time. There are presently 22,955,659 outstanding shares of our common
stock held by stockholders which are deemed “restricted securities” as defined
by Rule 144 under the Securities Act. Under certain circumstances,
these shares may be sold without registration pursuant to the provisions of Rule
144. In general, under rule 144, a person (or persons whose shares
are aggregated) who has satisfied a six-month holding period and who is not an
affiliate of the Company may sell restricted securities without limitation as
long as the Company is current in its SEC reports. A person who is an
affiliate of the Company may sell within any three-month period a number of
restricted securities which does not exceed the greater of one (1%) percent of
the shares outstanding or the average weekly trading volume during the four
calendar weeks preceding the notice of sale required by Rule
144. In addition, Rule 144 permits, under certain circumstances, the
sale of restricted securities by a non-affiliate without any limitations after a
one-year holding period. Any sales of shares by stockholders pursuant to Rule
144 may have a depressive effect on the price of our Common stock.
Our
Common Stock Is Traded Over the Counter, Which May Deprive Stockholders Of The
Full Value Of Their Shares
Our common
stock is quoted via the Over The Counter Bulletin Board (OTCBB). As
such, our common stock may have fewer market makers, lower trading volumes and
larger spreads between bid and asked prices than securities listed on an
exchange such as the New York Stock Exchange or the NASDAQ Stock
Market. These factors may result in higher price volatility and less
market liquidity for the common stock.
A
Low Market Price May Severely Limit The Potential Market For Our Common
Stock
Our common
stock is currently trading at a price substantially below $5.00 per share,
subjecting trading in the stock to certain SEC rules requiring additional
disclosures by broker-dealers. These rules generally apply to any
equity security that has a market price of less than $5.00 per share, subject to
certain exceptions (a “penny stock”). Such rules require the
delivery, prior to any penny stock transaction, of a disclosure schedule
explaining the penny stock market and the risks associated therewith and impose
various sales practice requirements on broker-dealers who sell penny stocks to
persons other than established customers and institutional or wealthy
investors. For these types of transactions, the broker-dealer must
make a special suitability determination for the purchaser and have received the
purchaser’s written consent to the transaction prior to the sale. The
broker-dealer also must disclose the commissions payable to the broker-dealer,
current bid and offer quotations for the penny stock and, if the broker-dealer
is the sole market maker, the broker-dealer must disclose this fact and the
broker-dealer’s presumed control over the market. Such information
must be provided to the customer orally or in writing before or with the written
confirmation of trade sent to the customer. Monthly statements must
be sent disclosing recent price information for the penny stock held in the
account and information on the limited market in penny stock. The
additional burdens imposed upon broker-dealers by such requirements could
discourage broker-dealers from effecting transactions in our common
stock.
The
Market Price Of Your Shares Will Be Volatile.
The stock
market price of gold mining exploration companies like us has been volatile.
Securities markets may experience price and volume volatility. The market price
of our stock may experience wide fluctuations that could be unrelated to our
financial and operating results. Such volatility or fluctuations could adversely
affect your ability to sell your shares and the value you might receive for
those shares.
Item
1B Unresolved
Staff Comments
The
Company has received a comment letter from the SEC and has complied with all
such comments in this 10-K filing.
Item
2 Properties
The
Company occupies certain executive and office facilities in Melbourne, Victoria,
Australia which are provided to it pursuant to the Service Agreement with AXIS.
See “Item 1- Business- Employees” and “Item 12- Certain Relationships and
Related Transactions”. The Company believes that its administrative
space is adequate for its current needs.
In
addition, we have an office in North America at Suite 1801, 1 Yonge Street,
Toronto ON Canada. The office receives mail, couriers and facsimiles
on our behalf and forwards any documents received to us. The lease is
for six months and can be renewed on a month to month basis. We pay a
fee of CDN$30 per month. This is a temporary arrangement whilst we
determine whether to open a permanent office.
Item
3 Legal
Proceedings
There are
no pending legal proceedings to which the Company is a party, or to which any of
its property is the subject, which the Company considers material.
Item
4 Submission
of Matters to a Vote of Security Holders
Not
Applicable
PART
II
Our common
stock is traded in the over-the-counter market and quoted on the OTC-Bulletin
Board under the symbol “GORV”. The trading for the common stock has
been sporadic and the market for the common stock cannot be classified as an
established trading market.
The
following table sets out the high and low bid information for the common stock
as reported by the OTC Bulletin Board for each period/quarter indicated in
US$:
As of
October 10, 2008, there were 26,714,130 shares of common stock issued, of which
26,711,630 were outstanding. We have (i) 10,000,000 special warrants on issue,
each of which is exercisable at any time until June 9, 2016, to acquire without
the payment of further consideration one share of common stock, at which time
all special warrants that have not been exercised will automatically convert
into shares of common stock; and (ii) 40,000,000 warrants outstanding which
expire on April 30, 2011, each of which is exercisable to purchase one share of
common stock for a purchase price of A$0.20 (US$0.1542). The warrants contain a
cashless exercise provision whereby the holder, at its option, may exercise the
warrants by surrender and cancellation of a portion of the shares of our common
stock issuable upon the exercise of the warrants based on the then current
market price of our common stock. If the holder of the warrants elected to
exercise the warrants pursuant to this provision, we would not receive any
proceeds from the exercise of the warrants.
For
information concerning shares issuable upon exercise of outstanding stock
options see Note 10 of the Notes to the Consolidated Financial
Statements.
To date we
have not paid any dividends on our common stock and we do not expect to declare
or pay any dividends on our common stock in the foreseeable future. Payment of
any dividends will depend upon our future earnings, if any, our financial
condition, and other factors deemed relevant by the Board of
Directors.
Shareholders
As of
September 30, 2008 the Company had approximately 130 shareholders of
record.
Dividend
Policy
It is the
present policy of the Board of Directors to retain earnings, when incurred, for
use in our business. We have not declared any cash dividends to the
holders of its Common Stock and do not intend to declare such dividends in the
foreseeable future.
Transfer
Agent
Our United
States Transfer Agent and Registrar is BNY Mellon Stockowner
Services.
Our
selected consolidated financial data presented below for each of the years in
the two-year period ended June 30, 2008, and the balance sheet data at June 30,
2007 (restated) and 2008 have been derived from consolidated financial
statements, which have been audited by PKF, Certified Public Accountants, a
Professional Corporation. The selected financial data should be read in
conjunction with our consolidated financial statements for each of the years in
the two-year period ended June 30, 2008, and Notes thereto, which are included
elsewhere in this Annual Report.
(Consolidated
Statement of Operations Data)
(in
thousands, except per share data)
Restatement
And Adjustments
On October
3, 2008 the Chief Financial Officer of Golden River Resources Corporation (the
“Company”), in consultation with its Audit Committee, the Company’s Board of
Directors and , its independent registered public accounting firm, determined
that the June 30, 2007 financial statements should no longer be relied on
because the valuation of 4,650,000 of options granted to the Company’s officers,
directors and consultants in October 2006 should be adjusted. In 2006, the
Company issued 4,650,000 options and utilized the services of an external valuer
to determine the value of the options using the binomial option pricing model.
At the time the market price used in the binomial option pricing model was
US$0.166 which was based on the price that the Company had been able to conclude
a private placement transaction and accordingly the Company believed this to be
the fair value of the shares of common stock at the time. Following discussions
with the staff (the “Staff”) of the Securities and Exchange Commission (“SEC”)
in connection with the Staff’s review of the Company’s fiscal 2006 and 2007 Form
10-KSB’s, the Company has agreed to use the market price of the shares of common
stock at the time of issue of the options (US$0.30) in the binomial option
pricing model.
The effect
of the adjustment is to increase the net loss for the year ended June 30, 2007
by A$313,000 and our net loss per share by A$(0.01) for the year ended June 30,
2007.
Management
has also agreed following discussions with the SEC staff to make an accounting
adjustment based on a comment by the Staff in a letter regarding certain stock
based compensation expenses based upon an estimate of volatility arising from
the 1,400,000 options issued in 2004. This adjustment has been made as a A$1.1
million reclass between additional paid-in capital and retained earnings
(deficit) and has been reflected within opening stockholders’ equity in the June
30, 2007 financial statements. Such adjustment had no effect on total
stockholders’ equity or the Company’s cash flows.
General
The
following discussion and analysis of our financial condition and plan of
operation should be read in conjunction with the Financial Statements and
accompanying notes and the other financial information appearing elsewhere in
this report. This report contains numerous forward-looking statements
relating to our business. Such forward-looking statements are identified by the
use of words such as believes, intends, expects, hopes, may, should, plan,
projected, contemplates, anticipates or similar words. Actual operating
schedules, results of operations, ore grades and mineral deposit estimates and
other projections and estimates could differ materially from those projected in
the forward-looking statements.
We are an
exploration stage mining company. Our objective is to exploit our
interest in the mineral claims in Nunavut, Canada. Our principal
exploration target is for gold and we are seeking to determine whether adequate
gold reserves are present on the property covered by our claims to develop an
operating mine. We are in the initial stages of our exploration
program and we have not yet identified any ore reserves. We have not
generated any revenues from operations.
Foreign
Currency Translation
The
majority of our administrative operations are in Australia and, as a result, our
accounts are reported in Australian dollars. The income and expenses of its
foreign operations are translated into Australian dollars at the average
exchange rate prevailing during the period. Assets and liabilities of the
foreign operations are translated into Australian dollars at the period-end
exchange rate. The following table shows the period-end rates of exchange of the
Australian and Canadian dollar compared with the US dollar during the periods
indicated.
The
exchange rate between the A$ and US$ has moved by 11.27% between June 30, 2007
and 2008. Accordingly, a direct comparison of costs between fiscal
2008 and 2007 is not necessarily a true comparison.
Results
of Operations
Year
ended June 30, 2008 versus Year ended June 30, 2007
Total
costs and expenses have decreased from A$1,999,000 for the year ended June 30,
2007 to A$1,140,000 (US$1,096,000) for the year ended June 30,
2008. The decrease was a net result of:
On October
19, 2006, the Directors of the Company issued a further 4,650,000 options under
the Stock Option Plan. The options have no issue price, an exercise price of
US30.84 cents, and a latest exercise date of October 19, 2016. The options vest
1/3 on October 19, 2007 (“T1”), 1/3 on October 19, 2008 (“T2”) and 1/3 on
October 19, 2009 (“T3”). The Company obtained an external valuation of the
options from an unrelated third party. The Company has calculated the fair value
of the 4,650,000 options at US$0.222 per option for T1, US$0.228 for T2 and
US$0.234 for T3 using the binomial option pricing model. The total value of the
options equates to A$1,406,287 (US$1,060,200) and is being amortized over the
vesting periods. For 2008, the amortisation amounted to A$388,084 (US$373,143)
and 600,000 options were forfeited. At June 30, 2008, the remaining value of the
unamortized deferred compensation of 4,050,000 outstanding options amounted to
A$243,512 (US$183,584).
Accordingly,
the loss from operations decreased from A$1,999,000 for the year ended June 30,
2007 to A$1,140,000 (US$1,096,000) for the year ended June 30,
2008.
The net
loss amounted to A$1,145,000 (US$1,100,000) for the year ended June 30, 2008
compared to a net loss of A$2,097,000 for the year ending June 30, 2007. The net
loss per common equivalent share in 2008 was A$0.03 (US$0.03) compared with a
net loss with a common equivalent share price of A$0.06 in the prior
year.
Liquidity
and Capital Resources
For the
fiscal year 2008, net cash used in operating activities was A$344,000
(US$331,000) primarily consisting of amounts spent on exploration of A$193,000
(US$185,000), and administration A$474,000 (US$456,000), a decrease prepayments
and deposits for the exploration programme of A$48,000 (US$46,000) offset by
increase in receivables of A$9,000 (US$8,000) and accounts payable and accrued
expense of A$378,000 (US$363,000).
Effective
as of June 9, 2006, Golden River Resources, entered into
a Subscription Agreement with RAB Special Situations Fund
(Master) Limited (“RAB”)
pursuant to which the Company issued to RAB
in a private placement transaction (the ”Private Placement”) for an aggregate
purchase price of A$2,000,000 (US$1,542,000): (i)10,000,000 special warrants
(the “Special Warrants”), each of which is exercisable at any time to acquire,
without additional consideration, one (1) share (the “Special Warrant Shares”)
of Common Stock, US$0.001 par value (“Common Stock"), of the Company, and (ii)
warrants (the “Warrants”) for the purchase of 20,000,000 shares of Common Stock,
US$0.001 par value (the “Warrant Shares”), at an exercise price
of A$0.20 (US$0.1542) to be exercisable until April 30,
2011.
The
Company agreed to prepare and file with the Securities and Exchange Commission a
registration statement covering the resale of the shares of Common Stock
issuable upon exercise of the Special Warrants and the Warrants which
registration statement was declared effective on October 17, 2006.
The
Company is obligated to keep such registration statement effective until the
earlier of (i) the date that all of the Registrable Securities have been sold
pursuant to such registration statement, (ii) all Registrable Securities have
been otherwise transferred to persons who may trade such shares without
restriction under the Securities Act, and the Company has delivered a new
certificate or other evidence of ownership for such securities not bearing a
restrictive legend, or (iii) all Registrable Securities may be sold at any time,
without volume or manner of sale limitations pursuant to Rule 144(k) or any
similar provision then in effect under the Securities Act; or (iv) 2 years from
the effective date.
As of June
30, 2008 we had short-term obligations of A$711,000 (US$684,000) consisting
mainly of accounts payable and accrued expenses.
We have
A$8,000 (US$8,000) in cash at June 30, 2008.
During
fiscal 2004 and 2005, we undertook a field exploration program on our Committee
Bay and Slave Properties. In relation to the Committee Bay Properties, this was
more than the minimum required expenditure and as a result, we do not have a
legal obligation to undertake further exploration on those properties during
their life. However our properties are prospective for gold and other
minerals. We undertook further exploration in August 2006 on the
Slave Properties and a summary of the results is set out in Item 1. The cost for
the 2007-2008 exploration program was A$193,000 (US$186,000) and subject to
funding, we may consider a drilling program in early 2009. At this stage, we
have not prepared a budget for this drilling program. Our budget for general and
administration for fiscal 2009 is A$0.9 million. We are currently
investigating capital raising opportunities which may be in the form of either
equity or debt, to provide funding for working capital purposes and future
exploration programs. There can be no assurance that such a capital
raising will be successful, or that even if an offer of financing is received by
the Company, it is on terms acceptable to the Company.
Cautionary
“Safe Harbour” Statement under the United States Private Securities Litigation
Reform Act of 1995.
Certain
information contained in this Form 10-KSB are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995 (“the Act”),
which became law in December 1995. In order to obtain the benefits of the “safe
harbor” provisions of the Act for any such forward-looking statements, we wish
to caution investors and prospective investors about significant factors which,
among others, have in some cases affected our actual results and are in the
future likely to affect our actual results and cause them to differ materially
from those expressed in any such forward-looking statements. This Form 10-K
contains forward-looking statements relating to future financial results. Actual
results may differ as a result of factors over which we have no control,
including, without limitation, the risks of exploration and development stage
projects, political risks of development in foreign countries, risks associated
with environmental and other regulatory matters, mining risks and competitors,
the volatility of gold and copper prices and movements in foreign exchange
rates.
Impact
of Australian Tax Law
Australian
resident corporations are subject to Australian income tax on their non-exempt
worldwide assessable income (which includes capital gains), less allowable
deductions, at the rate of 30%. Foreign tax credits are allowed where tax has
been paid on foreign source income, provided the tax credit does not exceed 30%
of the foreign source income.
Under the
U.S./Australia tax treaty, a U.S. resident corporation such as us is subject to
Australian income tax on net profits attributable to the carrying on of a
business in Australia through a “permanent establishment” in Australia. A
“permanent establishment” is a fixed place of business through which the
business of an enterprise is carried on. The treaty limits the Australian tax on
interest and royalties paid by an Australian business to a U.S. resident to 10%
of the gross interest or royalty income unless it relates to a permanent
establishment. Although we consider that we do not have a permanent
establishment in Australia, it may be deemed to have such an establishment due
to the location of its administrative offices in Melbourne. In addition we may
receive interest or dividends from time to time.
Impact
of Australian Governmental, Economic, Monetary or Fiscal Policies
Although
Australian taxpayers are subject to substantial regulation, we believe that our
operations are not materially impacted by such regulations nor is it subject to
any broader regulations or governmental policies than most Australian
taxpayers.
Impact
of Recent Accounting Pronouncements
For a
discussion of the impact of recent accounting pronouncements on the Company’s
financial statements, see Note 3 to the Company’s Consolidated Financial
Statements which are attached hereto.
At June
30, 2008, the Company had no outstanding borrowings under Loan
Facilities.
See F Pages
There have
been no changes in accountants or any disagreements with accountants on any
matter of accounting principles or practices or financial statement disclosures
during the two years ended June 30, 2008.
Our
principal executive officer and our principal financial officer evaluated the
effectiveness of our disclosure controls and procedures (as defined in Rule
13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 as amended) as of
the end of the period covered by this report. Based on that evaluation, such
principal executive officer and principal financial officer concluded that, the
Company’s disclosure control and procedures as of the end of the period covered
by this report.
Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Exchange act Rules
13a-15(f) under the Securities Exchange Act of 1934, as
amended. Under the supervision of management and with the
participation of our management, including our principal executive officer and
principal financial officer, we conducted an evaluation of the effectiveness of
our internal control over financial reporting based on the framework in Internal
Control-Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission. Based on our evaluation of internal
control over financial reporting, our management concluded that our internal
control over financial reporting was effective as of June 30, 2008.
This
annual report does not include an attestation report of the registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the registered public
accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit us to provide only management’s report in this annual
report.
The
current Form 10-K includes an adjustment for accounting for stock based
compensation which lead to a restatement of the 2007 reported figures and a
catch up relating to the adjustment for previous years as well.
Following
discussions with the staff of the Securities and Exchange Commission (“SEC”) in
connection with the staff’s review of the Company’s fiscal 2006 and 2007 Form
10-KSB, the Company has agreed that the valuation of 4,650,000 options granted
to the Company’s officers, directors and consultants in October 2006 should be
adjusted. The Company at the time believed the fair value of the shares of
common stock was that of a recent private placement transaction, but after the
discussions with SEC staff, the Company has agreed to use the market price of
the shares of common stock at the time of the issue of the options. The effect
of the adjustment is reflected in the restated net loss for the year ended June
30, 2007.
Management
has also agreed following discussions with the SEC staff to make an accounting
adjustment based on a comment by the SEC in a letter regarding certain stock
based compensation expenses based upon an estimate of volatility arising from
the 1,400,000 options issued in 2004. This adjustment has been reflected within
opening stockholders’ equity in the June 30, 2007 consolidated financial
statements and had no effect on total stockholders’ equity.
The
Company reports in its Consolidated Statement of Operations cumulative
information since the inception of its exploration activities. The effect of the
adjustments is recorded in the cumulative losses. The adjustment had no effect
on the Company’s cash flow.
In
evaluating the controls and procedures, and the circumstance leading to the
restatement, management does not believe that this restatement results in a
change to their assessment of the effectiveness of their Disclosure Controls and
Procedures or Internal Control over Financial Reporting, however management
agreed to make the aforementioned accounting adjustment based on a suggestion by
the SEC in a comment letter.
No change
in our internal control over financial reporting occurred during our most recent
fiscal quarter that has materially affected, or is reasonably likely to
materially affect our internal control over financial reporting.
We believe
that a controls system, no matter how well designed and operated, can not
provide absolute assurance that the objectives of the controls system are met,
and no evaluation of controls can provide absolute assurance that all control
issues and instances of fraud, if any, within a company have been
detected.
Item
9B Other
Information
None.
PART
III
Item
10. Directors
and Executive Officers and Corporate Governance
The
following table sets forth our directors and officers, their ages and all
offices and positions with our company. Officers and other employees
serve at the will of the Board of Directors.
Mr Gutnick
has been Chairman of the Board, President and Chief Executive Officer since
March 1988. He has been a Director of numerous public listed
companies in Australia specialising in the mining sector since 1980 and is
currently a Director of Quantum Resources Limited and President and CEO of
Legend International Holdings Inc, a US corporation listed on the OTC market and
President and CEO of Northern Capital Resources Corporation, Yahalom
International Resources Corporation and Calvert River Resources, Inc., US
corporations. Mr. Gutnick was previously a Director of the World Gold
Council. He is a Fellow of the Australasian Institute of Mining &
Metallurgy and the Australian Institute of Management and a Member of the
Australian Institute of Company Directors.
David
Tyrwhitt
Dr
Tyrwhitt was appointed a Director in November 1996. He is a geologist, holding a
Bachelor of Science and PhD degrees and has 40 years experience in mineral
exploration and management development and operation of gold mines in
Australia. Since 1996, Mr. Tyrwhitt has served as a consulting
geologist through David S. Tyrwhitt & Associates (June 2002 to present) and
Auminex Sdn. Bhd. (1996 to June 2002). Dr Tyrwhitt has been a Director of
numerous public listed companies in Australia in the mining industry and is
currently a Director of Hawthorn Resources N.L and Quantum Resources Limited
listed on the Australian Stock Exchange, Legend International Holdings Inc, a US
corporation listed on the OTC market and Northern Capital Resources
Corporation.
Peter
Lee
Mr Lee has
been Chief Financial Officer and Principal Accounting Officer since August 1989
and was appointed a Director in February 1996. Mr Lee is a Member of the
Institute of Chartered Accountants in Australia, a Fellow of Chartered
Secretaries Australia Ltd., a Member of the Australian Institute of Company
Directors and holds a Bachelor of Business (Accounting) from Royal Melbourne
Institute of Technology. He has over 25 years commercial experience and is
currently General Manager Corporate and Company Secretary of several listed
public companies in Australia and CFO and Secretary of Legend International
Holdings Inc, a US corporation listed on the OTC market, Northern Capital
Resources Corporation, Yahalom International Resources Corporation and Calvert
River Resources, Inc.
Mordechai
Gutnick
On
September 14, 2005, Mr Gutnick was elected a non-executive Director. He is a
businessman and long-term investor in the mining industry. From April
2001 to June 2002, Mr. Gutnick served as a project advisor for AXIS, which
provides services to the Company; from July 2002 to April 2003, Mr. Gutnick was
a private investor; and since May 2003, Mr. Gutnick has served as a
non-executive director of Quantum Resources Limited. Mr Gutnick has
been appointed to the Audit and Remuneration Committee’s, effective September
14, 2005. Mr Mordechai Gutnick is the son of Mr Joseph
Gutnick.
All
Directors have been appointed for a one-year term which expires in November
2008.
Directors
need not be stockholders of the company or residents of the State of Delaware.
Directors are elected for an annual term and generally hold office until the
next Directors have been duly elected and qualified. Directors may receive
compensation for their services as determined by the Board of Directors. A
vacancy on the Board may be filled by the remaining Directors even though less
than a quorum remains. A Director appointed to fill a vacancy remains a Director
until his successor is elected by the Stockholders at the next annual meeting of
Shareholder or until a special meeting is called to elect
Directors.
Board,
Audit Committee and Remuneration Committee Meetings
Our Board
of Directors consists of four members, of whom two have been, and continue to
be, independent under applicable regulations. During fiscal 2008, our Board of
Directors met two times. The Board of Directors also uses resolutions in writing
to deal with certain matters, and during fiscal 2008, two resolutions in writing
were signed by all Directors.
We do not
have a nominating committee. Historically our entire Board has selected nominees
for election as directors. The Board believes this process has worked well thus
far particularly since it has been the Board's practice to require unanimity of
Board members with respect to the selection of director nominees. In determining
whether to elect a director or to nominate any person for election by our
stockholders, the Board assesses the appropriate size of the Board of Directors,
consistent with our bylaws, and whether any vacancies on the Board are expected
due to retirement or otherwise. If vacancies are anticipated, or otherwise
arise, the Board will consider various potential candidates to fill each
vacancy. Candidates may come to the attention of the Board through a variety of
sources, including from current members of the Board, stockholders, or other
persons. The Board of Directors has not yet had the occasion to, but will,
consider properly submitted proposed nominations by stockholders who are not
directors, officers, or employees of Golden River Resources on the same basis as
candidates proposed by any other person.
Audit
Committee
Dr David
Tyrwhitt and Mr. Mordechai Gutnick constitute our Audit Committee. It is the
opinion of the Board of Directors that each of them is an independent director
as defined in Rule 10A-3 of the Securities Exchange Act of 1934. In addition,
the Board believes that Mr Tyrwhitt would meet the director independence
requirements of the Nasdaq Stock Market if we were listed on such Market, but
that Mr. Mordechai Gutnick would not meet such Nasdaq independence requirements
in light of his family relationship with Mr. Joseph Gutnick who is our Chief
Executive Officer. Our Audit Committee does not include a "financial expert" as
defined in Item 401 (e) of Regulation S-B. The Company only has two independent
Directors and neither of these independent Directors has a finance background.
The Audit Committee met once during fiscal 2008 and the Chair of the Audit
Committee met with the external auditors on three occasions during fiscal 2008
in respect to quarterly reports prior to the reports being filed.
Remuneration
Committee
The Board
has a Remuneration Committee comprised of two independent directors. During
fiscal 2008, the Remuneration Committee did not meet.
Code
of Ethics
We have
adopted a Code of Conduct and Ethics and it applies to all Directors, Officers
and employees. A copy of the Code of Conduct and Ethics is posted on
our website at www.goldenriverresources.com and we will provide a copy to any
person without charge. If you require a copy, you can download it
from our website or alternatively, contact us by facsimile or email and we will
send you a copy.
Stockholder
Communications with the Board
Stockholders
who wish to communicate with the Board of Directors should send their
communications to the Chairman of the Board at the address listed
below. The Chairman of the Board is responsible for forwarding
communications to the appropriate Board members.
Mr. Joseph
Gutnick
Golden
River Resources Corporation
PO Box
6315 St. Kilda Road
Central
Melbourne, Victoria 8008 Australia
Section
16(a) Beneficial Ownership Reporting Compliance
Pursuant
to Section 16(a) of the Securities Exchange Act of 1934, our Directors,
executive officers and beneficial owners of more than 10% of the outstanding
Common Stock are required to file reports with the Securities and Exchange
Commission concerning their ownership of and transactions in our Common Stock
and are also required to provide to us copies of such reports. Based
solely on such reports and related information furnished to us, we believe that
in fiscal 2008 all such filing requirements were complied with in a timely
manner by all Directors and executive officers
Item
11. Executive
Compensation.
The
following table sets forth the annual salary, bonuses and all other compensation
awards and pay outs on account of our Chief Executive Officer for services
rendered to us during the fiscal years ended June 30, 2008, 2007 and
2006. No other executive officer received more than US$100,000 per
annum during this period.
Summary
Compensation Table
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