AURORA GOLD CORPORATION |
FINANCIAL STATEMENTS (EXPRESSED
IN U.S. DOLLARS) |
ANNUAL
REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
AMENDMENT NO. 2
TO
FORM 10-K
FOR THE FISCAL
YEAR DECEMBER 31, 2013
x
ANNUAL REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
¨
TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __
to __
Commission file number 000-24393
AURORA GOLD
CORPORATION
(Exact name
of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
13-3945947
(I.R.S. Employer Identification
No.)
Coresco AG, Level 3, Gotthardstrasse
20, 6300 Zug, Switzerland
(Address of principal executive
offices)
+41 41 711 0281
(Issuer’s telephone number)
-
(Former name,
former address and former fiscal year, if changed since last report)
Securities
registered pursuant to Section 12(b) of the Act: None
Securities
registered pursuant to Section 12(g) of the Act:
Common Stock,
par value $0.005 per share
(Title of each
class)
Name of each
exchange on which registered: OTCQB
Indicate by
check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. .
¨
Yes x
No
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨Yes
x
No
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. xYes
¨
No
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). xYes
¨
No
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨
Yes x
No
1 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION
FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)
ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting
company” in Rule 12b-2 of the Exchange Act.
Larger
accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ý
Indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
☐Yes
ý
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 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: $1,176,337 as of June 30, 2013.
There were
51,188,990 shares of common stock outstanding on March 31, 2014.
Documents incorporated
by reference: None
2 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
EXPLANATORY NOTE
We are filing this Amendment No. 1 to Form
10-K in response to Staff comment letter dated September 16, 2014.
3 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
4 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Uncertainties
Relating To Forward-Looking Statements
The information
in this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act (SEC) of 1934. These forward-looking statements involve risks and uncertainties, including
statements regarding the Company’s capital needs, business strategy and expectations. Any statements contained herein that
are not statements of historical facts may be deemed to be forward-looking statements.
In some cases,
you can identify forward-looking statements by terminology such as “may”, “will”, “should”,
“expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”,
“predict”, “potential”, or “continue”, the negative of such terms or other comparable terminology.
Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including
the risks outlined from time to time, in other reports the Company files with the Securities and Exchange Commission.
The information
constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking
statements in this form are subject to risks and uncertainties that could cause actual results to differ materially from the results
expressed in or implied by the statements contained in this report. As a result, the identification and interpretation of data
and other information and their use in developing and selecting assumptions from and among reasonable alternatives requires the
exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated
or projected results, and accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance
can be given that any of the assumptions relating to the forward-looking statements specified in the following information are
accurate.
All forward-looking
statements are made as of the date of filing of this form and the Company disclaims any obligation to publicly update these statements,
or disclose any difference between its actual results and those reflected in these statements. The Company may, from time to time,
make oral forward-looking statements. The Company strongly advises that the above paragraphs and the risk factors described in
this Report and in the Company’s other documents filed with the United States Securities and Exchange Commission should
be read for a description of certain factors that could cause the actual results of the Company to materially differ from those
in the oral forward-looking statements. The Company disclaims any intention or obligation to update or revise any oral or written
forward-looking statements whether as a result of new information, future events or otherwise.
5 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
PART
I
ITEM 1 –
DESCRIPTION OF BUSINESS
Background
Organization
Aurora Gold
Corporation ("the Company" or “Aurora”) was formed on October 10, 1995 under the laws of the State of Delaware
and is in the business of location, acquisition, exploration and, if warranted, development of mineral properties. The Company’s
focus is on the exploration and development of its exploration properties located in the Tapajos Gold Province, State of Pará,
Brazil (refer Notes). The Company has not yet determined whether its properties contain mineral reserves that may be economically
recoverable and has not generated any operating revenues to date.
The Company
is a junior mineral exploration company and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse
20, 6304 Zug, Switzerland. The telephone number is (+41) 41 711 0281. These offices are provided to the Company on a month-to-month
basis. The Company believes these offices are adequate for the business requirements during the next 12 months. The Company does
not own any real property.
Business
Strategy
The general
business strategy is to acquire mineral properties either directly or through the acquisition of operating entities. The continued
operations and the recoverability of minerals are dependent upon the existence of economically recoverable mineral reserves, confirmation
of interest in the underlying properties and ability to obtain necessary financing to complete the development and future profitable
production. Since 1996 the Company acquired and disposed of a number of properties. The Company has not been successful in any
exploration efforts to establish reserves on any of the properties owned by or in which the Company holds an interest.
The Company
currently has an interest in a strategic land package of six (6) properties none of which contain any reserves. The Company has
no revenues, has sustained losses since inception and has been issued an opinion by the auditors expressing substantial doubt
about the ability to continue as a going concern. The Company will not generate revenues even if any of its exploration programs
indicate that a mineral deposit may exist on the properties. Accordingly, the Company will be dependent on future financings in
order to maintain operations and continue exploration activities.
Mining and
Exploration Properties
The strategic
objectives of the Company are to concentrate efforts on existing operations where infrastructure already exists, properties presently
being developed or in advanced stages of exploration that have potential for additional discoveries and grass-roots exploration
opportunities. The Company is currently concentrating on property exploration activities in Brazil.
The properties
are in the exploration stage only and without a known body of mineral reserves. Development of the properties will follow only
if satisfactory exploration results are obtained. Mineral exploration and development involves a high degree of risk and few properties
that are explored are ultimately developed into producing mines. There is no assurance that the mineral exploration and development
activities will result in any discoveries of commercially viable bodies of mineralization. The long-term profitability of the
operations will be, in part, directly related to the cost and success of the exploration programs, which may be affected by a
number of factors.
Mineral exploration
and development involves a high degree of risk and few properties that are explored are ultimately developed into producing mines.
There is no assurance that planned production will result in a commercial success, as production is gold price and politically
sensitive. Once production has commenced the Company is able to gauge the onward commercial viability of the project. There is
no assurance that planned mineral exploration and development activities will result in any further discoveries of commercially
viable bodies of mineralization. The long-term profitability of operations will be, in part, directly related to the cost and
success of exploration programs, which may be affected by a number of factors.
6 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
During 2013 and the first fiscal quarter
of 2014, the Company has been evaluating property holdings in order to determine whether to implement exploration programs on
existing properties or to acquire interests in new properties.
The Company
currently has an interest in six (6) properties located in Tapajos gold province in Para State, Brazil, collectively called the
Sao Domingo project. The Company has conducted exploration activities on the properties and have ranked the properties in order
of merit and may discontinue such activities and dispose of some of the rights to mineral exploration on the properties if further
exploration work is not warranted.
The geology
of the Săo Domingos property is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number
of gold deposits in the Tapajos Basin. Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity
of the Fofoca resource area, and basic rocks considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur
around the Esmeril target area. The Săo Domingos property was a previous large alluvial operation, and the property area
covers numerous areas of workings. The Săo Domingos property lies in the Tapajos Province of Para State, Brazil It is situated
approximately 250 km SE of Itaituba, the regional center. Small aircraft service Itaituba daily and on occasions flights can be
sourced via Manaus. Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is
subject to seasonal closures and ‘wet’ season site access is granted via light aircraft utilizing the local airstrip.
Tenures from
the Department of National Production Minerals (DNPM) are disclosed in the aforementioned notes to the financial statements.
7 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Significant
Developments in Fiscal 2013 and Subsequent Events to March 31, 2014
Exploration
Activities
The planned
activity for 2014 year is as follows:
The following
Plan of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results
could differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company may
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that the Company will be able to do so and the
Company does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and the Company has no history of earnings or cash flow from operations. While the Company may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of properties,
there is no assurance that any such activity will generate funds that will be available for operations.
The Company
intends to concentrate exploration activities on the Brazilian Tapajos properties and examine data relating to the potential acquisition
or joint venturing of additional mineral properties in either the exploration or development stage in other South American countries.
Additional contractors and consultants may be hired on as and when the requirement occurs.
The exploration
work program for the Fiscal 2014 will focus on the Brazilian properties. The Company intends to follow up results from previous
work on the Sao Domingo property, including the previous drilling and mapping over the Fofoca resource area. Follow up evaluation
of the geophysical anomaly west of Fofoca is required to test any strike continuity of potential economic mineralization. The
Toucano occurrence will be the focus of channel and auger sampling and will be the focus of an elluvial and oxide small scale
production scenario. This is follow up detailed sampling was in response to the high grade gold results noted from the oxide insitu
material mapped during the 2012 and 2013 exploration phases.
Two grids were
cut through the Fofoca west extension area and the area encompassing the Toucano gold occurrence. These areas were systematically
sampled and results showed numerous and extensive zones of anomalous gold mineralization. Assays were submitted for ICP Multi
element analysis and results contoured onto plans for review. The results are being analysed for their patterns as related to
classic deposit types for the region. The strong variance in the copper anomalism noted between the Toucano grid and the Fofoca
grid will be reviewed in relation to the possible timing of mineralizing events at project scale and compared to similar styles
within the Tapajos region. The dispersion of the elements has greatly aided the morphological understanding of the lithologies
of the project area, and will assist the technical team in targeting subsurface follow up work during the 2014 season. Subsurface
exploration will include trenching and follow up drilling at both the Fofoca resource area and the initial drill testing at the
Toucano gold occurrence. The technical team are confident that the numerous gold occurrences on the Sao Domingo property will
be related to each other and that important path finder elements and structures will lead to more drill targets. The anticipated
results should delineate further areas for alluvial/elluvial mining and bulk sampling targets, as well as provide further resource
ounces at Toucano to compliment the current and expected increased resources at Fofoca.
Aurora continued
the project wide evaluation of tailings and alluvial/elluvial potential. Results showed that follow up test work is recommended
and Aurora has an application in place for a trial mining license to carry out bulk sampling of recovery potentially economic
material. Concurrently a technical team has been assembled to continue the evaluation of both the alluvial/elluvial potential
and the geometry of the hard rock mineralization in preparation for subsurface test work.
Results of
the follow up exploration during 2013 identified further primary and placer gold occurrences, which were subsequently sampled
for gold and associated minerals; cartographic archival data was reviewed, and follow on exploration recommendations and budgets
established.
8 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Subject to receipt of financing, Aurora intends to execute a
3 Stage Exploration Plan
Stage 1. Total meters drilled will be a
maximum of 1,000. Budget US$350,000
Stage 2. Total meters drilled will be a
maximum of 2,000. Budget US$700,000
Stage 3. Combined with stage 2 and
includes tenement wide Auger program to comply with the Department of National Petroleum Minerals (“DNPM”)
resource determination. Budget US$1,000,000
Stage 1 program:
| · | Appraisal of grade and strike continuity to the North East and South
West of the current garimpeiro workings at Toucano. |
| · | Test the mineralization below these workings.
To date, the garimpeiros have worked the upper oxide component of the mineralised material which comprises of an altered stock
work within Parauari granites. Silica and pyrite are common in the higher grade zones and has a distinctive greyer colouring giving
some visual control on minerialization trends. |
| · | A 100m spaced series of grid lines grid
are planned with one drill hole on each section, (geologist discretion), targeting the minerialization. The target is to intersect
minerialization at or near the transition zone of Oxide to Sulphide, estimated within 30 to 40m from surface. It is anticipated
that hole depths, inclined at -600 to 325 will be in the range of 60m to 100m. Orientation data is based on previous work within
the Toucano pit area. The strike extent was also interpreted from geochem sampling of the area and which complimented technical
measurements done on the oxide insitu lithologies. |
| · | First drill hole, TOU001, will be targeting minerialization in hanging wall and below the current
workings. Following holes are designed to test the strike between the previous garimpeiro workings and to trace out the soil geochem
results. QA,QC –monitored by the site manager and using commercial standards. |
Stage 2 program:
This program designed
to follow up on any strike continuity and to infill drill lines with a view to blocking out mineralised material.
Stage 3 program:
| · | Auger drilling across the entire Toucano
grid. |
| · | Planned for 1,250 auger locations. |
| · | Contractor –Explorer Ltda (local exploration Co). |
| · | Auguring would be done down to auger refusal. |
| · | Samples would be collected on a 1m basis and sent for analysis in 2m composites or greater basis,
based on field observations and experience during the program. |
| · | Any higher grade samples would then have the 1m fractions of the those intervals sent for reanalysis
on a meter by meter basis. |
9 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The Company
has set up a field operations center at the Sao Domingos property and intend to continue to focus exploration activities on anomalies
associated with the Sao Domingos property. During 2013 the Company explored an area of approximately 60 acres of land on the fringe
of the Sao Domingo town ship and constructed an additional field base to house and service the increased staff and equipment.
The new field camp is located approximately 2 kilometers from the Sao Domingo technical office which is located in town center
of Sao Domingo. The Company selected the Săo Domingos property based on its proximity to the other properties, and the logistics
currently in place. Access to the Săo Domingos property is by light aircraft to a well-maintained strip, by road along the
government maintained Trans Garimpeiro highway, and by boat along the multitude of waterways in the Amazon Basin.
The company
also intends to expand the current infrastructure on Sao Domingo to include further staff accommodation, office space, workshops
for heavy machinery and upgrade the current onsite laboratory for assaying. Currently the Company has a budget for exploration
and alluvial/elluvial mining, and is ready to utilise the trial mining license once issued. The exploration phase during 2013,
coupled with data from previous campaigns has shown the project has great potential to host significant economic alluvial/elluvial
and hard rock mineralization.
Aurora continues
to work closely with Haywood Securities Inc., as the Company’s advisors and sponsoring broker, to complete its application
for the Toronto Stock Exchange –Venture (TSX-V). Completion of the site visit by Geosure Geological Consultants from Australia,
the Company’s independent technical qualified person, marked the final stage of the independent technical report, NI43-101,
required for the new listing of Aurora.
10 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
São
Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of the State of Para, Brazil.
In Brazil,
Aurora has six (6) properties with an approximate total of 16,590 ha within the Tapajos Gold Province. The Exploration licence
areas are located in the vicinity of the Săo Domingos Township. The Company has conducted various degrees of exploration
activities on the properties and ranked the mineralized occurrences in order of merit and may discontinue such activities and
dispose of some of the rights to mineral exploration on parts of the property if further exploration work is not warranted. A
summary of these properties approved by the Department of National Production Minerals (DNPM) is set out below.
| a) | DNPM
Process 850.684/06 1,985.91 ha |
| b) | DNPM
Process 850.782/05 6,656.20 ha |
| c) | DNPM
Processes 850.012/06 and 850.013/06; 1128.08 ha and 750.55 ha respectively |
| d) | DNPM
Process 850.119/06 1,068.72 ha |
| e) | DNPM
Process 859.587/95 5,000.00 ha |
São
Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of the State of Para, Brazil.
| a) | DNPM
Processes 850.684/06: 1,985.91 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.684/06, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and
possesses good title to the referred mineral rights. On September 13, 2006 Aurora submitted to DNPM one Exploration Claim for
gold covering an area of 4914.18 ha in the Municipality of Itaituba, State of Pará. According to the information obtained
such claim was correctly prepared and the required documents are in place but the area will be reduced to 1,985.91 due to overlapping
with third parties’ areas with priority rights. The Exploration Permit has not been granted yet. The above-mentioned area
is not related to any payments or royalties to third parties since Aurora claimed them directly.
| b) | DNPM
Processes 850.782/05: 6,656.20 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.782/05, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. On November 8, 2005 it was submitted to DNPM the Exploration
Claim for gold in the Municipality of Itaituba, State of Pará. The Exploration Permit was granted on November
28, 2006 for a 3 (three) year period. The transfer to Aurora was approved on March 24, 2009 and on September 28, 2009
it was requested the renewal of the Exploration Permit. This area was reduced from 6,756 ha to 5,651.98 ha due to the
overlapping with Garimpeira (alluvial) Mining properties held by Mr. Celio Paranhos. However the DNPM ́s general
attorney in Brasilia agreed with Aurora’s legal thesis and nullified all applications filed by Mr. Paranhos (about to 1,900
applications). A new Exploration Permit rectifying the previous one was granted on August 20, 2010 for a 3 (three)
year period, for an area of 6,656.20 hectares. An application has been lodged for the extension of the license and
Aurora is awaiting the results of this. The Annual Fees per Hectare (TAHs) for the 1st and 2nd years of the extension period have
been properly paid. The annual fee for the third year was paid in January 2013. No payments or royalties
are due regarding the DNPM Process 850.782/05 since it was acquired through a permutation agreement with Altoro Mineração
Ltda.
| c) | DNPM
Processes 850.012/06 and 850.013/06: 1,128.08 ha and 750.55 ha respectively |
The
exploration claims were submitted to DNPM on January 19, 2006, for gold covering an area of 1,128.08 ha and 750.55 ha respectively,
in the Municipality of Itaituba, State of Pará. According to information obtained such claims were correctly prepared and
the required documents are in place. The tenements 850.012/06 and 850.013/06 are held by Mr. Antonio Oliveira Ferreira and were
submitted to DNPM on January 19, 2006. The tenements are located at Itaituba, State of Pará and are valid and in force,
free and clear of any judicial and extrajudicial encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira
Reserve. The transfer to Aurora will be submitted after the Exploration Permits are granted. There are no payments or royalties
related to the tenements according to the agreement entered into with the previous owner.
11 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| d) | DNPM
Process 850.119/06: 1,068.72 ha |
Direct
access to the files of this Project at DNPM’s office were not sited, however analysis is based on the then current information
provided on DNPM’s website. The exploration claim was submitted to DNPM on March 7, 2006, for gold covering an area of 1,068.72
ha, in the Municipality of Itaituba, State of Pará. Aurora has good title over the mineral rights object of the DNPM Process
No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes. Aurora is
the sole registered and beneficial holder of and owns and possesses good title to the referred mineral rights. The Exploration
Permit has not been granted yet. The above-mentioned area is not related to any payments or royalties to third parties since Aurora
claimed them directly.
| e) | DNPM
Process 859.587/95: 5,000 ha |
The
tenement 859.587/95 is held by Aurora and is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. It is located at the Municipality of Itaituba, State of Pará. On November 27, 1995 it was
submitted to DNPM the Exploration Claim for gold. The Exploration Permit was granted on September 15, 2006 for a 3 (three)
years period covering an area of 5000 ha, and it was valid until September 15, 2009. On July 15, 2009 it was requested
the renewal of the Exploration Permit, which was granted on June 14, 2012. The renewal is valid until June 14, 2015, when
a Final Report must be submitted to DNPM with the results of the Exploration Activities. In order to have a Mining Permit granted,
Aurora must present the Economic Exploitation Plan and the Mining Concession Request in one year from the approval of the Final
Report.
12 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Exploration
expenditures
For fiscal
years ended December 31, 2013 and 2012, the Company recorded exploration expenses of $1,682,767 and $332,785 respectively.
Financing
Activities:
There were no financing activities during
the fiscal year ended December 31, 2013. The Company intends to continue financing activities by raising capital through the equity
markets. We cannot guarantee that we will be successful in obtaining sufficient equity financing to carry out our business plans.
On October
5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price of $5,000,000,
to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and the Alltech
Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common stock of
approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction, the Company
agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected by the Investor.
The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors of the Company. Additionally,
Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
On
June 5, 2013, Aurora Gold Corporation (the “ Registrant ”), pursuant to the provisions of Rule 477 promulgated under
the Securities Act of 1933, as amended, filed a Pre-Effective Amendment No.1 to withdraw the Registration Statement on Form S-1,
File No. 333-185908 (the “ Registration Statement ”), to deregister all of the 27,000,000 shares (the “ Shares
”) of the Registrant’s common stock, par value $0.005, originally registered pursuant the Registration Statement on
behalf of the Selling Shareholder named therein. The Registration Statement has not been declared effective; accordingly, none
of the Shares have been or will be offered pursuant to the Registration Statement. The Registrant confirms its understanding that
the fee paid upon the filing of the Registration Statement will not be refunded.
In October
2011 the Company filed a Registration Statement on Form S-1 offering up to a maximum of 10,000,000 units of the Company's securities
at an offering price of $0.50 per Unit in a direct public offering, without any involvement of underwriters or broker-dealers.
Each Unit consists of one (1) share of common stock at a $0.005 par value per share and one (1) Stock Purchase Warrant. Each full
Warrant entitles the holder to purchase one additional share of common stock at a price of $1.00 for a period of two years commencing
November 1, 2011 through October 31, 2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer.
A Notice of Effectiveness was issued April 25, 2012. The offer expired January 20, 2013. No funds have been obtained from this
offering.
On April 16,
2012, the Company entered into subscription agreements for 263,200 shares of common stock at a purchase price of $0.30 per share
for a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they
are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay
a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 60,000 shares
of common stock at an issue price of $0.30 per share.
During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 398,180 shares of
common stock at an issue price of $0.30 per share.
In March 2012,
the Company entered into subscription agreements for 125,044 shares of common stock at a purchase price of $0.30 per share for
a gross aggregate price of $37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance
for Stock Subscriptions. The share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the
Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering,
the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum
$600,000 subscription that is being offered.
13 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Exploration
Activities
The Company
is a junior mineral exploration company and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse
20, 6304 Zug, Switzerland. The telephone number is +41 41 711 0281. These offices are provided to the Company on a month-to-month
basis. The Company believes these offices are adequate for the business requirements during the next 12 months. The Company does
not own any real property.
The strategic
objectives of the Company are to concentrate efforts on existing operations where infrastructure already exists, properties presently
being developed or in advanced stages of exploration that have potential for additional discoveries and grass-roots exploration
opportunities. The Company is currently concentrating on property exploration activities in Brazil.
The properties
are in the exploration stage only and without a known body of mineral reserves. Development of the properties will follow only
if satisfactory exploration results are obtained. Mineral exploration and development involves a high degree of risk and few properties
that are explored are ultimately developed into producing mines. There is no assurance that the mineral exploration and development
activities will result in any discoveries of commercially viable bodies of mineralization. The long-term profitability of the
operations will be, in part, directly related to the cost and success of the exploration programs, which may be affected by a
number of factors.
The Company
currently has an interest in a strategic land package of six (6) properties none of which contain any reserves.
Plan of Operation
contains forward-looking statements that involve risks and uncertainties, as described below. The actual results could differ
materially from those anticipated in these forward-looking statements. During the next 12 months the Company may raise additional
funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses and to conduct
work on exploration properties. There is, of course, no assurance that the Company will be able to do so and the Company does
not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced commercial
production and the Company has no history of earnings or cash flow from operations. While the Company may attempt to generate
additional working capital through the operation, development, sale or possible joint venture development of properties, there
is no assurance that any such activity will generate funds that will be available for operations.
Distribution
Methods of Products and Services
The Company
is a mineral exploration company and is not in the business of distributing any products or services.
Status of
any Publicly Announced New Product or Service
The Company
has no plans for new products or services not already offered.
Competitive
Business Conditions and Competitive Position in the Industry and Methods of Competition
Vast areas
of Brazil have been explored and in some cases staked through mineral exploration programs. Vast areas also remain unexplored.
The cost of staking and re-staking new mineral claims and the costs of most phase one exploration programs are relatively
modest. Additionally, in many more prospective areas, extensive literature is readily available with respect to previous
exploration activities. These facts make it possible for a junior mineral exploration company such as Aurora to be very
competitive with other similar companies. The Company is also competitive with senior companies who are doing grass roots exploration.
In the event exploration activities uncover prospective mineral showings, the Company anticipates being able to attract the interest
of better financed industry partners to assist on a joint venture basis in more extensive exploration. The Company is at a competitive
disadvantage compared to established mineral exploration companies when it comes to being able to complete extensive exploration
programs on claims which held or that may be held in the future. If the Company is unable to raise capital to pay for extensive
claim exploration, the Company will be required to enter into joint ventures with industry partners that will result in the interest
in the claims being substantially diluted.
Management
of the Company remains committed to building a portfolio of mineral exploration properties principally through their own efforts.
The Company is a small entity in a large competitive industry with many other junior exploration companies evaluating and re-evaluating
prospective mineral properties in Brazil.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Sources
and Availability of Raw Materials and the Names of Principal Suppliers
As a mineral
exploration company, the Company does not require sources of raw materials and does not have principal suppliers in the way, which
applies to manufacturing companies. The raw materials are, in effect, mineral exploration properties staked or acquired
from third parties. The management team seeks to assemble a portfolio of quality mineral exploration properties in Brazil and
elsewhere in South America, and continues to review any properties, worldwide, that may fall within the scope of the management
and technical teams’ expertise. Initially, the Company operates in the field with the president and various consultants
on an as needed basis. This enables the Company to assemble a portfolio of properties through grass roots exploration and
staking. The Company will also acquire new properties via option agreements when new properties can be acquired on favorable
terms.
Dependence
on One or a Few Major Customers
The Company
is in the business of mineral exploration. The Company does not sell any product or service and therefore has no dependence
on one or a few major customers.
Patents,
Trademarks, Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts, Including Duration
The Company
does not own any patents or trademarks. The Company is not party to any labor agreements or contracts. Licenses, franchises,
concessions and royalty agreements are not part of the business.
Need for
any government approval of principal products or services
As a mineral
exploration company, the business does not require extensive government approvals for principal products or services. The
Department National Production Minerals (DNPM) of Brazil outlines and governs the work that can be done on mining claims in Brazil.
In the event
mining claims acquire in the future prove to host viable ore bodies, the Company would likely sell or lease the deposit to a company
whose business is the extraction and treatment of ore. This company would undertake the sale of metals or concentrates and pay
us a net smelter royalty as specified in a future lease agreement. All responsibility for government approvals pertaining
to mining methods, environmental impacts and reclamation would be the responsibility of this contractor. All costs to obtain
the necessary government approvals would be factored into technical and viability studies in advance of a decision being made
to proceed with development of an ore body.
The mining
industry in Brazil is highly regulated. The president and various consultants have extensive industry experience and are
familiar with government regulations respecting the initial acquisition and early exploration of mining claims in Brazil and many
other countries in South America, Australia, Africa, Kazakhstan and the former Soviet Union. The Company is required under law
to meet government standards relating to the protection of land and waterways, safe work practices and road construction. The
Company is unaware of any proposed or probable government regulations that would have a negative impact on the mining industry
in Brazil. The Company proposes to adhere strictly to the regulatory framework, which governs mining operations in Brazil.
Effect of
existing or probable governmental regulations on the business
Management
is unaware of any existing or probable government regulations, which would have a positive or negative impact on the Company.
Costs and
effects of compliance with environmental laws (federal, state and local)
At the present
time, the costs of compliance with environmental laws are minimal. In the event that claims, which may be, acquired in the
future host a viable ore body, the costs and affects of compliance with environmental laws will be incorporated in the exploration
plan for these claims. Qualified mining engineers will prepare these exploration plans.
15 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Number of
total employees and number of full time employees
The Company
does not have employees. The Company does appoint contractors and consultants. As of March 31, 2014, the Company had on call between
10 to 24 contractors and consultants.
ITEM 1A
– RISK FACTORS
Aurora is a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required
under this item.
ITEM 1B
– UNRESOLVED STAFF COMMENTS
Aurora is a smaller reporting company
as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item. However,
at the time of this filing, Aurora has not resolved comments from the Staff’s letter of August 7, 2014.
16 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 2 –
DESCRIPTION OF PROPERTY
Office Premises
The Company
conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland. The telephone
number is +41 41 711 0281. These offices are provided to the Company on a month-to-month basis. The Company believes these offices
are adequate for the business requirements during the next 12 months. The Company does not own any real property. Aurora maintains
its statutory registered agent’s office at 1859 Whitney Mesa Drive, Henderson, Nevada, 89014.
Mining and
Exploration Properties
The Company
was incorporated under the laws of the State of Delaware on October 10, 1995, under the name "Chefs Acquisition Corp."
Initially formed for the purpose of engaging in the food preparation business, the Company redirected business efforts in late
1995 following a change of control, which occurred on October 30, 1995, to the acquisition, exploration and development of mineral
resource properties. The Company name changed to “Aurora Gold Corporation” on August 20, 1996 to more fully
reflect the resource exploration business activities.
The general
business strategy is to acquire mineral properties either directly or through the acquisition of operating entities. The continued
operations and the recoverability of minerals are dependent upon the existence of economically recoverable mineral reserves, confirmation
of interest in the underlying properties and ability to obtain necessary financing to complete the development and future profitable
production. Since 1996 the Company acquired and disposed of a number of properties. The Company has not been successful in any
exploration efforts to establish reserves on any of the properties owned by or in which the Company holds an interest.
The Company
currently has an interest in a strategic land package of six (6) properties none of which contain any reserves. The Company has
no revenues, has sustained losses since inception and has been issued an opinion by the auditors expressing substantial doubt
about the ability to continue as a going concern. The Company may not generate revenues even if any of its exploration programs
indicate that a mineral deposit may exist on the properties. Accordingly, the Company may be dependent on future financings in
order to maintain operations and continue exploration activities.
The Company
has not been involved in any bankruptcy, receivership or similar proceedings.
The strategic
objectives of the Company are to concentrate efforts on existing operations where infrastructure already exists, properties presently
being developed or in advanced stages of exploration that have potential for additional discoveries and grass-roots exploration
opportunities. The Company is currently concentrating on property exploration activities in Brazil.
The properties
are in the exploration stage only and without a known body of mineral reserves. Development of the properties will follow only
if satisfactory exploration results are obtained. Mineral exploration and development involves a high degree of risk and few properties
that are explored are ultimately developed into producing mines. There is no assurance that the mineral exploration and development
activities will result in any discoveries of commercially viable bodies of mineralization. The long-term profitability of the
operations will be, in part, directly related to the cost and success of the exploration programs, which may be affected by a
number of factors.
Mineral exploration
and development involves a high degree of risk and few properties that are explored are ultimately developed into producing mines.
There is no assurance that planned production will result in a commercial success, as production is gold price and politically
sensitive. Once production has commenced the Company is able to gauge the onward commercial viability of the project. There is
no assurance that planned mineral exploration and development activities will result in any further discoveries of commercially
viable bodies of mineralization. The long-term profitability of operations will be, in part, directly related to the cost and
success of exploration programs, which may be affected by a number of factors.
17 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
During 2013 and the first fiscal quarter of 2014, ended March 31, 2014, the Company has been evaluating
property holdings in order to determine whether to implement exploration programs on existing properties or to acquire interests
in new properties.
SAO DOMINGO EXPLORATION COSTS- LIFE TO DATE [In US Dollars] | |
as at 31 Dec.2013 | |
| |
| |
EXPLORATION GENERAL | |
| 332,785 | |
| |
| | |
EXPLORATION ASSAYING | |
| 31,611 | |
| |
| | |
EXPLORATION DRILLING | |
| 9,690 | |
| |
| | |
EXPLORATION FIELD AND CAMP COSTS | |
| 616,027 | |
| |
| | |
EXPLORATION GEOLOGICAL CONSULTING | |
| 544,526 | |
| |
| | |
EXPLORATION LICENSES | |
| 26,990 | |
| |
| | |
EXPLORATION SALARY AND WAGES | |
| 257,058 | |
| |
| | |
EXPLORATION TRAVEL AND HELICOPTER | |
| 196,858 | |
| |
| | |
TOTAL EXPLORATION COSTS: | |
| 2,015,544 | |
The Company
currently has an interest in six (6) properties located in Tapajos gold province in Para State, Brazil, collectively called the
Sao Domingo project. The Company has conducted exploration activities on the properties and have ranked the properties in order
of merit and may discontinue such activities and dispose of some of the rights to mineral exploration on the properties if further
exploration work is not warranted.
The geology
of the Săo Domingos property is predominantly composed of paleo-proterozoic Parauari Granites that play host to a number
of gold deposits in the Tapajos Basin. Typical Granites of the younger Maloquinha Intrusive Suite have been noticed in the vicinity
of the Fofoca resource area, and basic rocks considered to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur
around the Esmeril target area. The Săo Domingos property was a previous large alluvial operation, and the property area
covers numerous areas of workings. The Săo Domingos property lies in the Tapajos Province of Para State, Brazil It is situated
approximately 250 km SE of Itaituba, the regional center. Small aircraft service Itaituba daily and on occasions flights can be
sourced via Manaus. Access from Itaituba to site is by small aircraft or unsealed road of average to poor quality. The road is
subject to seasonal closures and ‘wet’ season site access is granted via light aircraft utilizing the local airstrip.
Tenures from
the Department of National Production Minerals (DNPM) are disclosed in the aforementioned notes to the financial statements.
In Brazil,
Aurora has six (6) properties with an approximate total of 16,590 ha within the Tapajos Gold Province. The Exploration licence
areas are located in the vicinity of the Săo Domingos Township. The Company has conducted various degrees of exploration
activities on the properties and ranked the mineralised occurrences in order of merit and may discontinue such activities and
dispose of some of the rights to mineral exploration on parts of the property if further exploration work is not warranted. A
summary of these properties approved by the Department of National Production Minerals (DNPM) is set out below.
| a) | DNPM
Process 850.684/06 1,985.91 ha |
| b) | DNPM
Process 850.782/05 6,656.20 ha |
| c) | DNPM
Processes 850.012/06 and 850.013/06; 1128.08 ha and 750.55 ha respectively |
| d) | DNPM
Process 850.119/06 1,068.72 ha |
| e) | DNPM
Process 859.587/95 5,000.00 ha |
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Access and infrastructure.
Itaituba is a township with a population
of approximately 120,000, which predominantly supports artisanal mining, farming, agriculture and fishing, and is located approximately
240 kms north of the project area. Itaituba is situated between Belem and Manaus - both are cities of greater than two million
people and are located on the Amazon River.
19 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The Săo Domingos property
was a previous large alluvial operation, and the property area covers numerous areas of workings. The Săo Domingos property
lies in the Tapajos Province of Para State, Brazil It is situated approximately 250 km SE of Itaituba, the regional centre. Small
aircraft service Itaituba daily and on occasions flights can be sourced via Manaus. Access from Itaituba to site is by small aircraft
to an airstrip located on the verge of the Township and/or via sealed and unsealed roads. The road is subject to seasonal closures
and ‘wet’ season site access is granted via light aircraft utilizing the local airstrip.
The company has a house located
in the township of Sao Domingo which provides office, messing and storage facilities to the field staff. The company has also acquired
an area of 30 acres of land proximal to the Toucano target area, where a 10 man camp and messing facilities were constructed via
a local contractor.
The project area has a series
of unsealed roads that allow vehicular access to most areas of interest, after which short traverses on foot can access areas of
interest.
The Sao Domingo Township provides
adequate access to unskilled and semi-skilled labour, along with limited workshops and provision stores.
Project Geology
20 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The geology of the São Domingós
property is predominantly composed of paleoproterozoic Parauari Granites that play host to many gold deposits in the Tapajós
Basin. Granites typical of the younger Maloquinha Intrusive Suite have been noticed in the project area, and basic rocks considered
to be part of the mesoproterozoic Cachoeira Seca Intrusive Suite occur around the Esmeril area.
Within the São Domingós project
area the main structures strike NE-SW to E-W. Nearly all documented quartz veins run parallel to this general tectonic trend. Gold,
silver, sphalerite, galena, pyrite, chalcopyrite, millerite, malachite and azurite are common minerals found within the rocks within
the São Domingós project area. Mineralised rocks in the project area can have elevated copper and oxidised specimens
can show significant azurite and malachite.
The Fofoca prospect lies NNE of the village
of São Domingós. Previous work by garimpeiros is obvious by the presence of a water filled pit, anecdotally 30 metres
deep in some parts, excavated during the 1990’s by garimpeiros exploiting an east west striking quartz vein and adjacent
stockwork system. The water filled pits follow the vein and continue to the east where it splits into two pits. It is possible
that these pits represent a bifurcation of the vein. Water ingress and poor wall instability saw the cessation of excavation and
subsequently old stockpiles were re-treated. The area may have been subject to late stage faulting which has resulted in offsetting
the mineralised structure. This 'offsetting' NE-SW trending fault is as yet untested by drilling, but a recent geophysical survey
supports the interpretation. This model suggests that the Cachoeirinha prospect is in fact the western off set extension of Fofoca.
Diamond drilling has defined an E-W striking
quartz vein of approximately 300 metres in strike length at Fofoca. This structure, which is in the order of 0.5 to 1 metres wide
and hosted within the Parauari Granites, is the core of the mineralised zone at Fofoca. Around the ‘high grade’ core
of quartz veining associated sulphides and weakly developed stockwork is a ‘low grade’ alteration halo. The stockwork
appears poorly developed and is spatially restricted, so mineralization does not extend to any significant distance from the primary
vein and thus contacts can be considered sharp. The Fofoca vein has been intersected at depths of over 150 metres and is still
considered open at depth, one of the targets of the ill-fated 2008 Fofoca drill program was to target extensions of mineralization
at depth. Along strike and down dip the vein is interpreted to vary in thickness locally but to no significant degree. The current
interpretation is that the Fofoca vein is terminated to the west by late stage faulting and that the Cachoerinha mineralization
is the offset continuation of Fofoca some 400 metres west. A creek crosses the Fofoca vein to the east and to the author's knowledge
no work has been down to close of the mineralization to the east, as such it still remains open.
Gold, sphalerite, galena, pyrite and chalcopyrite
are commonly associated with the Fofoca vein and where no petrographic, though it is believed that gold mineralization is in some
way associated with sulphide mineralogy. Further work needs to be completed better understand the geochemical characterisation
of the mineralization at Fofoca and to use this knowledge as an exploration model for other targets in the project area. Initial
geological mapping indentified the occurrence of ’red’ granite considered to be part of the Maloquinha Intrusive Suite.
At least three deformation events have been seen in field observations, but the dominant feature seems to strike approximately
ENE-WSW. Around old workings highly altered and weathered granitic rocks as well as and tuffaceous volcanic rocks and breccias
have been identified.
The property is in an evaluation state
whereby previous work is being reviewed in order to prioritise targets for follow up drilling as part of the value adding process.
21 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
All power for the Sao Domingo property
is via generators. The company has a series of generators to meet the needs of office functions, pumping and any three phase requirements
for work shop related matter. Water is pumped from catchment areas and collected in tanks from natural rain water. The area has
several permanent small rivers and creeks which provide ample water to the area throughout the year.
QAand QC of exploration samples
Drilling
A total of 1,528 drill core samples
were submitted to SGS Lakefield Geosol Laboratórios Ltda for chemical analysis from the two drilling campaigns in the Fofoca
prospect in 2006 and 2007 (1,359 in 2006 and 169 in 2007 respectively). Drilling was supervised by the Aurora geological team who
inspected individual runs and ensured good recoveries and that depths and orientations were reconciled. Core was stored in labeled
boxes at the drill site and transported securely by Aurora personnel to the Aurora core farm daily. Core was laid out for processing
in the a purpose built core shed. Here core was logged lithologically and geotechnically, no RQD recovery measurements were taken.
Limited structural data was captured. The core was marked up for sampling and photographed. The sample numbers were written on
the wooden core boxes making it easier to sample and for future reference. Sample length varied enormously with samples varying
from less than 70cm to over 6 metres in length. Quartz veining was sampled at a maximum interval of approximately 1 metre. Drill
cores was sampled on site by cutting in half along the orientation line (no or little control on which half was sampled). The practice
of cutting core along the orientation line should be avoided in future as this reference may be required if further geotechnical
information is required from the core. Sample intervals were determined on different characteristics and mainly according whether
the material was quartz vein or not, the sampling practise should be reviewed particularly given the limited geological knowledge
which exits in relation to Fofoca and the other deposits of the area. All core was placed and secured in calico sample bags with
sample numbers printed on the calico bags and also present on a 'ticket' placed inside the bag with the sample. Samples were logged
and secured in larger polyweave sacks in consecutive sample order for secure transport to Itaituba for sample preparation at SGS
laboratories sample preparation facility. All sampling and sample dispatch was done under the supervision of Aurora geology staff.
All samples used for validation
and interpretation and in the mineralised material estimate were processed by SGS Lakefield Geosol Laboratórios Ltda, a
global laboratory network who operate under ISO guidelines and are certified to ISO 9001:2000 industrial standards. SGS have preparation
facilities and laboratories all over South America which included Itaituba at the time. Wet laboratory analyses for these samples
were also processed by SGS of Brazil at their Belo Horizonte facilities. SGS was engaged as a commercial laboratory for analyses
of samples and samples were prepared and analyzed under commercial terms. No relationship beyond service supplier and client exist
between Aurora Gold Corporation and SGS Lakefield Geosol Laboratórios Ltda.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Samples were securely shipped from São Domingós
to the SGS sample preparation facility in Itaituba. Samples were dried at 105°C for a minimum of eight hours, then crushed
to <2mm in a jaw crusher and samples were then split and quartered. A 250 gram fraction was pulverised in ring and puck pulverizer
to pass through –150 mesh, with a laboratory standard of more than 80% passing. No grind checks were submitted to Geosure
for validation. A representative portion of the pulverised 250 gram fraction was split in a riffle splitter and then sent to Belo
Horizonte for quantitative chemical analysis at SGS’s wet laboratory.
Samples were analysed for Au
by fire assay (FA) in 50 gram beads, with an atomic absorption spectrometry (AAS) finish. A further 32 elements were determined
by inductively coupled plasma mass spectrometry (ICP-MS).
Soils
In May-July 2013 the Fofoca Site was
surveyed by geochemical profiling over the 100x20 m survey grid. A total of 1237 samples were collected in the course of implementation
of the geochemical sampling program. All samples were analysed for 36 elements by the inductively coupled plasma-mass spectrometry
method (ICP-MS) (Table 1) at the international accredited laboratory AcmeLabs, Vancouver, Canada. Each batch of samples
included blank samples (blanks), standard samples (SRM) and duplicate samples. Every 100 samples included 2 duplicate samples,
2 standard samples (standard OxD108 - 0,414 ppm Au; and standard OxJ95 - 2,337 ppm Au), and one blank sample.
Thus, 5% quality control was maintained.
Map provided by Dmitry
Makarov a geologist for the Company.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
BRAZILIAN EXPLORATION PERMIT PROCESS
APPLICATION
In order to obtain a mineral exploration permit, the interested
party must present an application addressed to the DNPM, containing the following information and documentation:
| (i) | For individuals, name and proof of Brazilian nationality,
marital status, occupation, domicile and number of enrolment with the Individual Taxpayers’ Registry of the Ministry of
Finance (CPF/MF). For companies, corporate name, number of registration of the company’s articles of association/by-laws
at the proper commercial registry, head office address and number of enrolment with the National Registry of Legal Entities (CNPJ); |
| (ii) | Proof that the corresponding fees have been paid; |
| (iii) | Designation of the substances to be prospected for; |
| (iv) | Indication of the surface extension of the area applied
for, expressed in hectares, and the municipality and state where the property is located; |
| (v) | Memorandum containing the description of the requested
area; |
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| (vi) | Plan map of the location of the area, indicating the graphic definition and the main cartographic elements of the area; and |
(vii) Prospecting work plan, including the budget and the schedule
for the performance of the work.
Non-presentation of the documents listed above will cause prompt
dismissal of the application by the DNPM. The applicant will be entitled to complete any missing information or documentation within
60 days from the publishing of the notice to meet such requirements by the DNPM. A fee must be paid by the applicant presenting
the application to the DNPM.
PRIORITY RIGHTS
The applicant for a mineral exploration permit, whose application
is related to an area considered as free, shall be granted the priority in obtaining the respective title. Therefore, the first
application presented to the DNPM for a certain area shall constitute, in general, a priority right. The area will be considered
as free when:
| (i) | the area is not bound to any other exploration permit, permit registration, mining concession, mine manifest, aerial geological
recognizance permission, or any extraction registration by the federal, state and municipal agencies of the direct administration
or by independent governmental agencies; |
| (ii) | the area is not the object of a previous application for an exploration permit, or in cases where there is a previous application,
such previous application is subject to prompt dismissal; |
| (iii) | the area is not the object of a previous permit registration request, or if tied to a permit, the registration of such permit
will be requested within 30 days of its issuance date; |
| (iv) | the area is not the object of a previous extraction registration request filed by any federal, state and municipal agencies
of the direct administration or by independent agencies; |
| (v) | the area is not tied to a request for renewal of an exploration permit, presented in time and pending approval; |
| (vi) | the area is not tied to an exploration permit with a final report presented in time and pending approval; and |
| (vii) | the area is not bound to an exploration permit with a final report approved and the legal right to request the mining concession
still in force. |
SIZE OF AREA
The mineral exploration permits are limited to the following
maximum areas:
| (i) | 2,000 hectares for deposits of metalliferous mineral substances, mineral fertilizers, coal, diamonds, bituminous and pyrobituminous
rocks, turf and salt-gem; |
| (ii) | 50 hectares for deposits of sands, gravels and grits for the immediate use in the construction industry; rocks and mineral
substances for paving blocks, curbstones, gutters, posts and the like; clay used to manufacture ceramics; rocks, stamped for immediate
use in construction industry and limestone used as soil corrective element in agriculture; mineral waters, bottled and drinking
waters; sands for industrial use; feldspar; gems (except diamonds); ornamental stones and micas; |
| (iii) | 1,000 hectares for deposits of mineral external rocks and other substances not indicated in items (i) and (ii) above; |
| (iv) | 10,000 hectares for deposits of minerals indicated in item (i) above for areas located in the Amazônia Legal;
and |
| (v) | 5 hectares for deposits of mineral substances for the immediate use in the construction industry, which extraction will be
carried out by the federal, state and municipal agencies of the direct administration or by independent agencies. |
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DURATION
A mineral exploration permit shall be valid
and legally in force for a minimum of one year and a maximum of three years from the date of its issuance. Said permit can be successively
renewed at the discretion of the DNPM, upon the request of the titleholder. The exploration permit shall be valid for two years
in the cases of prospecting of mineral substances indicated in item 4.2.3 (ii) above. For exploration of other substances, the
permit shall be valid for three years.
In order to renew the permit, the DNPM
shall take into consideration the development of the work performed. The request for renewal of the permit must be presented 60
days prior to the expiration date of the original permit or the previous renewed permit. As to the renewal request, a report must
be presented of the work already carried out, indicating the results achieved, as well as reasons justifying continued work. The
renewal of the permit does not depend on the publication of a new permit, but only on the publication of the decision to renew.
In the event of partial interference in
the area requested and provided that exploration in the remaining area will be justified and considered as technically and economically
feasible by the DNPM, the applicant shall be previously consulted to determine if said applicant would be interested in readjusting
the application for the remaining area. If the request was dismissed due to the unavailability of the requested area, the applicant
shall not be entitled to any claim.
REPORT
The holder of an exploration permit must
provide any information requested by the DNPM at the end of the work program and within the validity period of the mineral exploration
permit. The holder must present a final report to the DNPM containing geological and technological studies relating to the size
of the deposit, as well as demonstrative analysis of the technical and economic feasibility of the exploitation. Such report must
be prepared under technical responsibility of a legally qualified professional and must also contain:
(i) information on the area, means of access
and communication;
(ii) plan of the geological survey;
(iii) description of the main aspects of
the deposit;
(iv) quality of the mineral substance and
definition of the deposit;
(v) genesis of the deposit, as well as
its qualification and comparison to similar
(i) deposits;
(vi) report of the industrialization assays;
(vii) demonstration of the economic feasibility
of the deposit; and
(viii) necessary information for the calculation
of any resources on the license, such as the density, area, volume and content.
The final exploration report must be presented
independent from the results of the work and shall conclude for the feasibility or non-feasibility of the exploitation development,
or for the non-existence of the deposit. The holder of an exploration permit who does not present a final report within the date
established by the regulations will be fined. Nevertheless, the exemption from presentation of the report is permitted in certain
cases of permit relinquishment by the titleholder. The DNPM must confirm the relinquishment, provided it happened in one of the
two following instances:
| (i) | at any time, if the titleholder has not been successful at entering the area, despite all the efforts
made, including judicial means; or |
| (ii) | before one-third (1/3) of the term of duration of the exploration permit has passed. |
OBLIGATIONS
The titleholder of an exploration permit
shall be obliged to:
(i) perform work only within the area specified
in the authorization;
(ii) respect the rights of third parties,
indemnifying them for damage and losses caused;
(iii) communicate to the DNPM the discovery
of a mineral substance not included in the authorization;
26 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
(iv) remove the substances extracted from
the area object of the permit for analysis and industrial experiments only with prior authorization of the DNPM (Utilization Bill)
and in accordance with the applicable environmental legislation;
(v) start the work within 60 days of the
date of the publication of the permit in the Official Gazette of the Federal Executive or as from the judicial ingress in the area
to be explored;
(vi) not interrupt the work without justification
for more than three consecutive months or for more than 120 non-consecutive days;
(vii) compensate the surface owner or possessor
for the occupation of the land and for damage or loss caused by the work; and
(viii) present a final prospecting report.
Besides the fee to be paid for obtaining
the mineral exploration permit, the titleholder must also pay to the DNPM an annual fee per each hectare. The fee is established
at progressive values, considering the substance, place and size of the area, among other conditions.
RIGHTS
The titleholder of an exploration permit
may execute the respective work and necessary auxiliary services, as well as work on land of private or public domain included
in the area indicated on the exploration title. The titleholder shall be assured the right of free passage on the private property,
including the soil and subsoil in the title area, as well as in neighbouring areas, for performance of the respective work. The
titleholder of a set of exploration permits for the same mineral substance in neighbouring or close areas shall be entitled and
authorized to present a single research plan and final report, involving and covering the whole set.
TRANSFERABILITY
The mineral exploration permit is a title
that can be assigned, totally or partially, to anyone who is in condition to execute the work under such permit in accordance with
the applicable legislation. The applications for exploration permits are also transferable, once the respective priority right
is assured. The transfer of the permit must be communicated to the DNPM for approval and registration. It will only be legally
valid after such procedure is complete.
SANCTIONS
Failure to comply with the obligations
derived from exploration permits, depending on the seriousness of the infraction, shall result in the following sanctions imposed
by the DNPM: warning, fine or forfeiture.
UTILIZATION BILL
It is possible to extract mineral substances
before the mining concession is granted, by means of a Utilization Bill. Extraction may only occur if the interested party has
obtained a proper environmental license, and has entered into an agreement with the surface owner as to the extraction work.
SECURITY OF TENURE
After the completion of prospecting work
in accordance with the legal provisions and after the approval of the final report by the DNPM, the titleholder shall have the
exclusive right to request a mining concession for the area. In this case, the concession can only be refused if the mining work
is considered harmful to the public or compromises interests that are more relevant than industrial exploitation.
After the filing of the application for
the mining concession and after the approval of the mine’s development plan by the DNPM, the mining concession cannot be
refused by the Government. Once the mining concession has been granted and all the legal requirements and provisions duly observed,
the concession cannot be cancelled.
27 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
São
Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of the State of Para, Brazil.
| a) | DNPM
Processes 850.684/06: 1,985.91 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.684/06, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and
possesses good title to the referred mineral rights. On September 13, 2006 Aurora submitted to DNPM one Exploration Claim for
gold covering an area of 4914.18 ha in the Municipality of Itaituba, State of Pará. According to the information obtained
such claim was correctly prepared and the required documents are in place but the area will be reduced to 1,985.91 due to overlapping
with third parties’ areas with priority rights. The Exploration Permit has not been granted yet. The above-mentioned area
is not related to any payments or royalties to third parties since Aurora claimed them directly.
| b) | DNPM
Processes 850.782/05: 6,656.20 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.782/05, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. On November 8, 2005 it was submitted to DNPM the Exploration
Claim for gold in the Municipality of Itaituba, State of Pará. The Exploration Permit was granted on November
28, 2006 for a 3 (three) year period. The transfer to Aurora was approved on March 24, 2009 and on September 28, 2009
it was requested the renewal of the Exploration Permit. This area was reduced from 6,756 ha to 5,651.98 ha due to the
overlapping with Garimpeira (alluvial) Mining properties held by Mr. Celio Paranhos. However the DNPM ́s general
attorney in Brasilia agreed with Aurora’s legal thesis and nullified all applications filed by Mr. Paranhos (about to 1,900
applications). A new Exploration Permit rectifying the previous one was granted on August 20, 2010 for a 3 (three)
year period, for an area of 6,656.20 hectares. An application has been lodged for the extension of the license and
Aurora is awaiting the results of this. The renewal will be for a further 3 years and is expected to be granted in the near
future. The Annual Fees per Hectare (TAHs) for the 1st and 2nd years of the extension period have been properly paid. The
annual fee for the third year was paid in January 2013. No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Mineração Ltda.
| c) | DNPM
Processes 850.012/06 and 850.013/06: 1,128.08 ha and 750.55 ha respectively |
The
exploration claims were submitted to DNPM on January 19, 2006, for gold covering an area of 1,128.08 ha and 750.55 ha respectively,
in the Municipality of Itaituba, State of Pará. According to information obtained such claims were correctly prepared and
the required documents are in place. The tenements 850.012/06 and 850.013/06 are held by Mr. Antonio Oliveira Ferreira and were
submitted to DNPM on January 19, 2006. The tenements are located at Itaituba, State of Pará and are valid and in force,
free and clear of any judicial and extrajudicial encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira
Reserve. The transfer to Aurora will be submitted after the Exploration Permits are granted. There are no payments or royalties
related to the tenements according to the agreement entered into with the previous owner.
| d) | DNPM
Process 850.119/06: 1,068.72 ha |
Direct
access to the files of this Project at DNPM’s office were not sited, however analysis is based on the then current information
provided on DNPM’s website. The exploration claim was submitted to DNPM on March 7, 2006, for gold covering an area of 1,068.72
ha, in the Municipality of Itaituba, State of Pará. Aurora has good title over the mineral rights object of the DNPM Process
No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes. Aurora is
the sole registered and beneficial holder of and owns and possesses good title to the referred mineral rights. The Exploration
Permit has not been granted yet. The above-mentioned area is not related to any payments or royalties to third parties since Aurora
claimed them directly.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| e) | DNPM
Process 859.587/95: 5,000 ha |
The
tenement 859.587/95 is held by Aurora and is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. It is located at the Municipality of Itaituba, State of Pará. On November 27, 1995 it was
submitted to DNPM the Exploration Claim for gold. The Exploration Permit was granted on September 15, 2006 for a 3 (three)
years period covering an area of 5000 ha, and it was valid until September 15, 2009. On July 15, 2009 it was requested
the renewal of the Exploration Permit, which was granted on June 14, 2012. The renewal is valid until June 14, 2015, when
a Final Report must be submitted to DNPM with the results of the Exploration Activities. In order to have a Mining Permit granted,
Aurora must present the Economic Exploitation Plan and the Mining Concession Request in one year from the approval of the Final
Report.
ITEM 3 –
LEGAL PROCEEDINGS
Aurora is not
a party to any pending legal proceedings and, to the best of Aurora’s knowledge, none of Aurora’s assets are the subject
of any pending legal proceedings.
ITEM 4 –
MINING SAFETY DISCLOSURES
There are no
current mining activities at the date of this report.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
PART
II
ITEM 5 –
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASE OF EQUITY SECURITIES
The Common
Stock is currently quoted on the OTCQB. The common stock was removed from the OTC Bulletin Board effective May 20, 2009 and relisted
on the OTCBB on August 5, 2010. In 2011 the Company was removed from the OTCBB and relisted on the OTCQB.
The following
table sets forth the high and low bid prices for the Common Stock for the calendar quarters indicated as reported by the OTCQB
for the last two years. These prices represent quotations between dealers without adjustment for retail mark-up, markdown or commission
and may not represent actual transactions. The stock is also quoted on the Berlin-Bremen Exchange (A4G.BE).
High & Low Bids |
Period ended | |
High | | |
Low | | |
Source |
December 31, 2013 | |
$ | 0.175 | | |
$ | 0.040 | | |
OTC Markets, Inc. |
September 30, 2013 | |
$ | 0.035 | | |
$ | 0.016 | | |
OTC Markets, Inc. |
June 30, 2013 | |
$ | 0.038 | | |
$ | 0.024 | | |
OTC Markets, Inc. |
March 31, 2013 | |
$ | 0.050 | | |
$ | 0.030 | | |
OTC Markets, Inc. |
December 31, 2012 | |
$ | 0.064 | | |
$ | 0.001 | | |
OTC Markets, Inc. |
September 30, 2012 | |
$ | 0.060 | | |
$ | 0.040 | | |
OTC Markets, Inc. |
June 30, 2012 | |
$ | 0.060 | | |
$ | 0.040 | | |
OTC Markets, Inc. |
March 31, 2012 | |
$ | 0.070 | | |
$ | 0.060 | | |
OTC Markets, Inc. |
The closing
price on March 25, 2014 was $0.055.
As of March
31, 2014, there were approximately 725 holders of record of the Common Stock. The Company has not paid any cash dividends.
There are 1,930,000
(2012: 1,930,000) shares reserved for issuance pursuant to options granted under the Company’s stock option plan as at December
31, 2013.
The transfer
agent of common stock is Worldwide Stock Transfer, LLC, having an office at 433 Hackensack Avenue, Level L. Hackensack, NJ, USA
07601.
The Company
has never paid cash dividends on the capital stock and does not anticipate paying any cash dividends in the foreseeable future,
but intends to retain capital for reinvestment in the business. Any future determination to pay cash dividends will be at the
discretion of the Board of Directors and will be dependent upon the financial condition, results of operations, capital requirements
and other factors as the board of directors deems relevant. No securities were issued without registration under the Securities
Act of 1933, as amended (the "Act") during the fourth quarter of Fiscal 2013.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| e. | Unregistered
Sales of Equity Securities and Use of Proceeds |
The Company
did not make any repurchases of securities during the fourth quarter of fiscal year ended December 31, 2013 or the subsequent
period through to March 31, 2014.
The Securities
and Exchange Commission has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks.
The stock is currently a “penny stock.” Penny stocks are generally equity securities with a price of less than $5.00,
other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current
price and volume information with respect to transactions in such securities is provided by the exchange or system. The penny
stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a
standardized risk disclosure document prepared by the Commission, which: (a) contains a description of the nature and level of
risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker’s
or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation
to such duties or other requirements of Securities’ laws; (c) contains a brief, clear, narrative description of a dealer
market, including bid and ask prices for penny stocks and significance of the spread between the bid and ask price; (d) contains
a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or
in the conduct of trading in penny stocks; and (f) contains such other information and is in such form as the Commission shall
require by rule or regulation. The broker-dealer also must provide to the customer, prior to effecting any transaction in a penny
stock, (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the
transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the
depth and liquidity of the market for such stock; and (d) monthly account statements showing the market value of each penny stock
held in the customer’s account. In addition, the penny stock rules require that prior to a transaction in a penny stock
not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable
investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement,
a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitably statement.
These disclosure
requirements may have the effect of reducing the trading activity in the secondary market for the stock if it becomes subject
to these penny stock rules.
Rule 144
There were 51,188,990 shares of Common
Stock issued and outstanding at March 31, 2014, of which 31,667,436 shares are deemed "restricted securities," within
the meaning of Rule 144. Absent registration under the Securities Act, the sale of such shares is subject to Rule 144, as promulgated
under the Securities Act.
In general,
under Rule 144, subject to the satisfaction of certain other conditions, a person deemed to be one of the Company’s affiliates,
who has beneficially owned restricted shares of the Common stock for at least one year is permitted to sell in a brokerage transaction,
within any three-month period, a number of shares that does not exceed the greater of 1% of the total number of outstanding shares
of the same class, or, if the common stock is quoted on a stock exchange, the average weekly trading volume during the four calendar
weeks preceding the sale, if greater.
Rule 144 also
permits a person who presently is not and who has not been an affiliate of the Company for at least three months immediately preceding
the sale and who has beneficially owned the shares of common stock for at least nine months to sell such shares without restriction
other than the requirement that there be current public information as set forth in Rule 144. To the extent that Rule 144 is otherwise
available, this provision is currently applicable to all of the restricted shares. If a non-affiliate has held the shares for
more than one year, such person may make unlimited sales pursuant to Rule 144 without restriction.
The possibility
that substantial amounts of the common stock may be sold under Rule 144 into the public market may adversely affect prevailing
market prices for the common stock and could impair the Company’s ability to raise capital in the future through the sale
of equity securities.
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AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 6 –
SELECTED FINANCIAL DATA
Aurora is a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required
under this item.
ITEM 7 –
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following
discussion and analysis should be read in conjunction with the Financial Statements and Notes to the Financial Statements filed
with this Report.
Organization,
Business Strategy and Going Concern
Organization
Aurora Gold
Corporation ("the Company") was formed on October 10, 1995 under the laws of the State of Delaware and is in the business
of location, acquisition, exploration and, if warranted, development of mineral properties. The Company’s focus is on the
exploration and development of its exploration properties located in the Tapajos Gold Province, State of Pará, Brazil (refer
to Note 3). The Company has not yet determined whether its properties contain mineral reserves that may be economically recoverable
and has not generated any operating revenues to date.
The Company
is a junior mineral exploration company and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse
20, 6304 Zug, Switzerland. The telephone number is (+41) 41 711 0281. These offices are provided to the Company on a month-to-month
basis. The Company believes these offices are adequate for the business requirements during the next 12 months. The Company does
not own any real property.
Business
Strategy
The general
business strategy is to acquire mineral properties either directly or through the acquisition of operating entities. The continued
operations and the recoverability of minerals are dependent upon the existence of economically recoverable mineral reserves, confirmation
of interest in the underlying properties and ability to obtain necessary financing to complete the development and future profitable
production. Since 1996 the Company acquired and disposed of a number of properties. The Company has not been successful in any
exploration efforts to establish reserves on any of the properties owned by or in which the Company holds an interest.
The Company
currently has an interest in a strategic land package of six (6) properties none of which contain any proven reserves.
Going Concern
The Company
has no revenues, and has sustained losses since inception. The Company will not generate revenues even if any of its exploration
programs indicate that a mineral deposit may exist on the properties. Accordingly, the Company will be dependent on future financings
in order to maintain operations and continue exploration activities.
These consolidated
financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern,
which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.
The general business strategy of the Company is to acquire mineral properties either directly or through the acquisition of operating
entities. The Company has incurred recurring operating losses since inception, has not generated any operating revenues to date
and during the year ended December 31, 2013, operating activities used cash of $3,414,198 (December 31, 2012: $1,296,342). The
Company requires additional funds to meet its obligations and maintain its operations.
These conditions
raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in this regard are to raise
equity financing through private or public equity investment in order to support existing operations and expand its business.
There is however no assurance that such additional funding will be available to the Company when required, or on terms acceptable
to the Company. In the event that the Company cannot obtain additional funds, on a timely basis, or the operations do not generate
sufficient cash flow, the Company may be forced to curtail development or cease activities. These consolidated financial statements
do not include any adjustments that might result from this uncertainty.
32 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The Company
has no revenues, has sustained losses since inception, has been issued an opinion expressing substantial doubt about the ability
to continue as a going concern by the auditors and relies upon the sale of securities to fund operations. The Company will not
generate revenues even if any of exploration programs indicate that a mineral deposit may exist on the properties. Accordingly,
the Company will be dependent on future financings in order to maintain operations and continue exploration activities.
The properties
are in the exploration stage only and without a known body of mineral reserves. Development of the properties will follow only
if satisfactory exploration results are obtained. Mineral exploration and development involves a high degree of risk and few properties
that are explored are ultimately developed into producing mines. There is no assurance that the mineral exploration and development
activities will result in any discoveries of commercially viable bodies of mineralization. The long-term profitability of the
operations will be, in part, directly related to the cost and success of the exploration programs, which may be affected by a
number of factors.
The Company
has not been involved in any bankruptcy, receivership or similar proceedings.
33 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The planned
activity for 2014 year is as follows:
The following
Plan of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results
could differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company may
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that the Company will be able to do so and the
Company does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and the Company has no history of earnings or cash flow from operations. While the Company may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of properties,
there is no assurance that any such activity will generate funds that will be available for operations.
The Company
intends to concentrate exploration activities on the Brazilian Tapajos properties and examine data relating to the potential acquisition
or joint venturing of additional mineral properties in either the exploration or development stage in other South American countries.
Additional contractors and consultants may be hired on as and when the requirement occurs.
The exploration
work program for the Fiscal 2014 will focus on the Brazilian properties. The Company intends to follow up results from previous
work on the Sao Domingo property, including the previous drilling and mapping over the Fofoca resource area. Follow up evaluation
of the geophysical anomaly west of Fofoca is required to test any strike continuity of potential economic mineralization. The
Toucano occurrence will be the focus of channel and auger sampling and will be the focus of an elluvial and oxide small scale
production scenario. This is follow up detailed sampling was in response to the high grade gold results noted from the oxide insitu
material mapped during the 2012 and 2013 exploration phases.
Two grids were
cut through the Fofoca west extension area and the area encompassing the Toucano gold occurrence. These areas were systematically
sampled and results showed numerous and extensive zones of anomalous gold mineralization. Assays were submitted for ICP Multi
element analysis and results contoured onto plans for review. The results are being analysed for their patterns as related to
classic deposit types for the region. The strong variance in the copper anomalism noted between the Toucano grid and the Fofoca
grid will be reviewed in relation to the possible timing of mineralizing events at project scale and compared to similar styles
within the Tapajos region. The dispersion of the elements has greatly aided the morphological understanding of the lithologies
of the project area, and will assist the technical team in targeting subsurface follow up work during the 2014 season. Subsurface
exploration will include trenching and follow up drilling at both the Fofoca resource area and the initial drill testing at the
Toucano gold occurrence. The technical team are confident that the numerous gold occurrences on the Sao Domingo property will
be related to each other and that important path finder elements and structures will lead to more drill targets. The anticipated
results should delineate further areas for alluvial/elluvial mining and bulk sampling targets, as well as provide further resource
ounces at Toucano to compliment the current and expected increased resources at Fofoca.
Aurora continued
the project wide evaluation of tailings and alluvial/elluvial potential. Results showed that follow up test work is recommended
and Aurora has an application in place for a trial mining license to carry out bulk sampling of recovery potentially economic
material. Concurrently a technical team has been assembled to continue the evaluation of both the alluvial/elluvial potential
and the geometry of the hard rock mineralization in preparation for subsurface test work.
Results of
the follow up exploration during 2013 identified further primary and placer gold occurrences, which were subsequently sampled
for gold and associated minerals; cartographic archival data was reviewed, and follow on exploration recommendations and budgets
established.
The Company
has set up a field operations center at the Sao Domingos property and intend to continue to focus exploration activities on anomalies
associated with the Sao Domingos property. During 2013 the Company acquired approximately 60 acres of land on the fringe of the
Sao Domingo town ship and constructed an additional field base to house and service the increased staff and equipment. The new
field camp is located approximately 2 kilometers from the Sao Domingo technical office which is located in town center of Sao
Domingo. The Company selected the Săo Domingos property based on its proximity to the other properties, and the logistics
currently in place. Access to the Săo Domingos property is by light aircraft to a well-maintained strip, by road along the
government maintained Trans Garimpeiro highway, and by boat along the multitude of waterways in the Amazon Basin.
34 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The company
also intends to expand the current infrastructure on Sao Domingo to include further staff accommodation, office space, workshops
for heavy machinery and upgrade the current onsite laboratory for assaying. Currently the Company has a budget for exploration
and alluvial/elluvial mining, and is ready to utilise the trial mining license once issued. The exploration phase during 2013,
coupled with data from previous campaigns has shown the project has great potential to host significant economic alluvial/elluvial
and hard rock mineralization.
Aurora continues
to work closely with Haywood Securities Inc., as the Company’s advisors and sponsoring broker, to complete its application
for the Toronto Stock Exchange –Venture (TSX-V). Completion of the site visit by Geosure Geological Consultants from Australia,
the Company’s independent technical qualified person, marked the final stage of the independent technical report, NI43-101,
required for the new listing of Aurora.
35 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Results
of Operations
Year
Ended December 31, 2013 (Fiscal 2013) versus Year Ended December 31, 2012 (Fiscal 2012)
Revenues
and Net Loss
The Company
has yet to generate any revenues or establish any history of profitable operations. For the year ended December 31, 2013 the Company
recorded a net loss of $3,405,489 (2012: net loss $1,200,374) or $(0.07) [2012: $(0.04)] per share.
Expenses
The increase
in year on year quarter costs reflects the increased activities to actively manage and engage in exploration activities.
Exploration
expenditures
For the year
ended December 31, 2013 the Company recorded exploration expenses of $1,682,767 (2012: $332,785), the majority relating to Brazilian
properties during the current and prior year.
Depreciation
expense
Depreciation
expenses charged to operations for the year ended December 31, 2013 were $42,176 (2012: $5,129).
Capital
Resources and Liquidity
December
31, 2013 versus December 31, 2012
During 2013
the capital markets continued to be tight and many companies had restricted access to debt and equity financing. The Company's
exploration properties are in the exploration stage and have not commenced commercial production. Consequently the Company has
no history of earnings or cash flow from its operations. As a result, the Company is reviewing its 2014 exploration and capital
spending requirements in light of the current and anticipated, global economic environment.
The Company
currently finances its activities primarily by the private placement of securities. There is no assurance that equity funding
will be accessible to the Company at the times and in the amounts required to fund the Company’s activities. There are many
conditions beyond the Company’s control, which have a direct bearing on the level of investor interest in the purchase of
Company securities. The Company may also attempt to generate additional working capital through the operation, development, sale
or possible joint venture development of its properties; however, there is no assurance that any such activity will generate funds
that will be available for operations. Debt financing has been used to fund the Company’s property acquisitions and exploration
activities. The Company does not have “standby” credit facilities, or off-balance sheet arrangements and it does not
use hedges or other financial derivatives. The Company has no agreements or understandings with any person as to additional financing.
At December
31, 2013, the Company had cash of $55,161 (2012: 3,963,836) and working capital of negative $103,387 (2012: positive working capital
of $3,754,403). Total liabilities as of December 31, 2013 were $228,067 (2012: $277,343).
The Company
intends to continue finance activities by raising capital through the equity markets and special purpose placements.
On
October 5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price
of $5,000,000, to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and
the Alltech Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common
stock of approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction,
the Company agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected
by the Investor. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors
of the Company. Additionally, Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
36 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
On
June 5, 2013, Aurora Gold Corporation (the “ Registrant ”), pursuant to the provisions of Rule 477 promulgated under
the Securities Act of 1933, as amended, filed a Pre-Effective Amendment No.1 to withdraw the Registration Statement on Form S-1,
File No. 333-185908 (the “ Registration Statement ”), to deregister all of the 27,000,000 shares (the “ Shares
”) of the Registrant’s common stock, par value $0.005, originally registered pursuant the Registration Statement on
behalf of the Selling Shareholder named therein. The Registration Statement has not been declared effective; accordingly, none
of the Shares have been or will be offered pursuant to the Registration Statement. The Registrant confirms its understanding that
the fee paid upon the filing of the Registration Statement will not be refunded.
In
October 2011 the Company filed a Registration Statement on Form S-1 offering up to a maximum of 10,000,000 units of the Company's
securities at an offering price of $0.50 per Unit in a direct public offering, without any involvement of underwriters or broker-dealers.
Each Unit consists of one (1) share of common stock at a $0.005 par value per share and one (1) Stock Purchase Warrant. Each full
Warrant entitles the holder to purchase one additional share of common stock at a price of $1.00 for a period of two years commencing
November 1, 2011 through October 31, 2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer.
A Notice of Effectiveness was issued April 25, 2012. The offer was deregistered on January 7, 2013 and none of the shares registered
were sold under the Registration Statement.
On April 16,
2012, the Company entered into subscription agreements for 263,200 shares of common stock at a purchase price of $0.30 per share
for a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they
are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay
a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 60,000 shares
of common stock at an issue price of $0.30 per share.
During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 398,180 shares of
common stock at an issue price of $0.30 per share.
In March 2012,
the Company entered into subscription agreements for 125,044 shares of common stock at a purchase price of $0.30 per share for
a gross aggregate price of $37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance
for Stock Subscriptions. The share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the
Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering,
the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum
$600,000 subscription that is being offered.
The general
business strategy is to acquire mineral projects either directly or through the acquisition of operating entities. The consolidated
financial statements have been prepared in accordance with generally accepted accounting principles in the USA and applicable
to a going concern concept, which contemplates the realization of assets and the satisfaction of liabilities and commitments during
the normal course of business. As discussed in note 1 to the consolidated financial statements, the Company has incurred recurring
operating losses since inception, has not generated any operating revenues to date and during December 31, 2013 operating activities
used cash of $3,414,198 (December 31, 2012: $1,296,342). The Company requires additional funds to meet the Company obligations
and maintain the operations. The Company may not have sufficient working capital to (i) pay administrative and general operating
expenses through December 31, 2014 and (ii) to conduct preliminary exploration programs. Without cash flow from operations, the
Company may need to obtain additional funds (presumably through equity offerings and/or debt borrowing) in order, if warranted,
to implement additional exploration programs on the properties. While the Company may attempt to generate additional working capital
through the operation, development, sale or possible joint venture development of the properties, there is no assurance that any
such activity will generate funds that will be available for operations. Failure to obtain such additional financing may result
in a reduction of interest in certain properties or an actual foreclosure of interest. The Company has no agreements or understandings
with any person as to such additional financing.
37 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The exploration
properties have not commenced commercial production and the Company has no history of earnings or cash flow from operations. While
the Company may attempt to generate additional working capital through the operation, development, sale or possible joint venture
development of property, there is no assurance that any such activity will generate funds that will be available for operations.
Cash Flow
Year
Ended December 31, 2013 (Fiscal 2013) versus Year Ended December 31, 2012 (Fiscal 2012).
Operating
activities:
The Company
used cash of $3,414,198 (2012: $1,296,342). Changes in prepaid expenses and other assets resulted in a decrease in cash of $1,609
(2012: decrease in cash of $67,910). Changes in accounts payable and accrued expenses (including related party) resulted in an
decrease in cash of $49,276 (2012: increase in cash of $6,013).
Investing
Activities:
During the
period the Company invested $375,115 in the purchase of equipment for exploration activities (December 31, 2012: $103,045).
Financing
Activities:
There were
no financing activities during the year ended December 31, 2013.
On October
5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price of $5,000,000,
to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and the Alltech
Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common stock of
approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction, the Company
agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected by the Investor.
The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors of the Company. Additionally,
Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
On
June 5, 2013, Aurora Gold Corporation (the “ Registrant ”), pursuant to the provisions of Rule 477 promulgated under
the Securities Act of 1933, as amended, filed a Pre-Effective Amendment No.1 to withdraw the Registration Statement on Form S-1,
File No. 333-185908 (the “ Registration Statement ”), to deregister all of the 27,000,000 shares (the “ Shares
”) of the Registrant’s common stock, par value $0.005, originally registered pursuant the Registration Statement on
behalf of the Selling Shareholder named therein. The Registration Statement has not been declared effective; accordingly, none
of the Shares have been or will be offered pursuant to the Registration Statement. The Registrant confirms its understanding that
the fee paid upon the filing of the Registration Statement will not be refunded.
In October
2011 the Company filed a Registration Statement on Form S-1 offering up to a maximum of 10,000,000 units of the Company's securities
at an offering price of $0.50 per Unit in a direct public offering, without any involvement of underwriters or broker-dealers.
Each Unit consists of one (1) share of common stock at a $0.005 par value per share and one (1) Stock Purchase Warrant. Each full
Warrant entitles the holder to purchase one additional share of common stock at a price of $1.00 for a period of two years commencing
November 1, 2011 through October 31, 2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer.
A Notice of Effectiveness was issued April 25, 2012. The offer expired January 20, 2013. No funds have been obtained from this
offering.
On April 16,
2012, the Company entered into subscription agreements for 263,200 shares of common stock at a purchase price of $0.30 per share
for a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they
are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay
a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 60,000 shares
of common stock at an issue price of $0.30 per share.
38 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 398,180 shares of
common stock at an issue price of $0.30 per share.
In March 2012,
the Company entered into subscription agreements for 125,044 shares of common stock at a purchase price of $0.30 per share for
a gross aggregate price of $37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance
for Stock Subscriptions. The share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the
Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering,
the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum
$600,000 subscription that is being offered.
Dividends
The Company
has neither declared nor paid any dividends on its’ Common Stock. The Company intends to retain earnings to finance growth
and expand operations and does not anticipate paying any dividends on common stock in the foreseeable future.
Asset-Backed
Commercial Paper
The Company
has no asset-backed commercial paper.
Fair Value
of Financial Instruments and Risks
Fair value
estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets
and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant
judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value.
The carrying
value of cash, accounts payable, accrued expenses and advances payable (including those amounts owing to related parties) approximate
their fair value because of the short-term nature of these instruments.
Management
is of the opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.
The Company
operates outside of the United States of America (primarily in Brazil) and is exposed to foreign currency risk due to the fluctuation
between the currency in which the Company operates in and the U.S. dollar in which the operations are reported.
39 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Share Capital
At March 31,
2014, the Company had:
| - | Authorized
share capital of 300,000,000 (December 31, 2012: 300,000,000) common shares with par
value of $0.005 each |
| - | 51,188,990
common shares were issued and outstanding (December 31, 2012: 49,828,942). |
| - | 1,930,000
(December 31, 2012: 1,930,000) stock options were outstanding under the incentive stock
option plan. The stock options are exercisable at prices ranging from $0.25 to $0.60
per share, with expiry dates ranging from October 10, 2016 to April 9, 2017. If the holders
were to acquire all 1,930,000 (December 31, 2012: 1,930,000) shares issuable upon the
exercise of all incentive stock options outstanding, the Company would receive an additional
$779,500 (December 31, 2012: $779,500). |
| - | 1,360,000
Warrants exercisable at $0.15 and expiring on February 13 2016 were outstanding (December
31, 2012: 1,600,000). |
On
August 15, 2013, an Information Statement was filed with the Securities and Exchange Commission and was mailed or otherwise furnished
to the registered stockholders of Aurora in connection with the prior approval by the board of directors of Aurora, and receipt
by the board of approval by written consent of the holders of a majority of Aurora’s outstanding shares of common stock,
of a resolution to:
| - | Approve
a consolidation of the issued and outstanding shares of common stock of Aurora, without
correspondingly decreasing the number of authorized shares of common stock, on a five
“old” shares for every one “new” share basis, which will result
in a decrease of Aurora’s issued and outstanding share capital from 249,144,706
shares to approximately 49,828,942 shares of common stock, not including any rounding
up of fractional shares to be issued on consolidation; |
| - | Approve
a change of the par value of the shares of common stock of Aurora from a pre-consolidated
par value of $0.001 per share to an amended par value of $0.005 per share; and |
| - | Amend
Article Four of the Articles of Aurora as follows “FOURTH. The authorized capital
stock of this Corporation shall consist of 300 Million (300,000,000) shares of common
stock with a par value of $0.005 per share.” |
Section
228 of the Delaware General Corporation Law and the By-laws of Aurora provide that any action required or permitted to be taken
at a meeting of the stockholders may be taken without a meeting if stockholders holding at least a majority of the voting power
sign a written consent approving the action. On July 24, 2013, the board of directors of Aurora approved and recommended the Resolutions.
Subsequently, the holders of a majority of the voting power signed and delivered to Aurora written consents representing at least
57.4% of the voting shares of common stock approving the Resolutions, in lieu of a meeting. Since the holders of the required
majority of shares of common stock have approved the Resolutions, no other votes are required or necessary and no proxies are
being solicited with this Information Statement. Aurora has obtained all necessary corporate approvals in connection with the
Resolutions and your consent is not required and is not being solicited in connection with the approval of the Resolutions. The
Information Statement was furnished solely for the purpose of informing stockholders in the manner required under the Securities
Exchange Act of 1934 of these corporate actions before they take effect. The Resolutions will not become effective until (i) the
date the Company receives confirmation from FINRA regarding the approval and effective date of the corporate action, or, (ii)
such later date as approved by the board of directors, in its sole discretion. The Certificate of Amendment will be filed with
the Secretary of State of Delaware and became effective October 22, 2013.
On
October 5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price
of $5,000,000, to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and
the Alltech Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common
stock of approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction,
the Company agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected
by the Investor. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors
of the Company. Additionally, Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
40 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
On
June 5, 2013, Aurora Gold Corporation (the “ Registrant ”), pursuant to the provisions of Rule 477 promulgated under
the Securities Act of 1933, as amended, filed a Pre-Effective Amendment No.1 to withdraw the Registration Statement on Form S-1,
File No. 333-185908 (the “ Registration Statement ”), to deregister all of the 27,000,000 shares (the “ Shares
”) of the Registrant’s common stock, par value $0.005, originally registered pursuant the Registration Statement on
behalf of the Selling Shareholder named therein. The Registration Statement has not been declared effective; accordingly, none
of the Shares have been or will be offered pursuant to the Registration Statement. The Registrant confirms its understanding that
the fee paid upon the filing of the Registration Statement will not be refunded.
In
October 2011 the Company filed a Registration Statement on Form S-1 offering up to a maximum of 10,000,000 units of the Company's
securities at an offering price of $0.50 per Unit in a direct public offering, without any involvement of underwriters or broker-dealers.
Each Unit consists of one (1) share of common stock at a $0.005 par value per share and one (1) Stock Purchase Warrant. Each full
Warrant entitles the holder to purchase one additional share of common stock at a price of $1.00 for a period of two years commencing
November 1, 2011 through October 31, 2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer.
A Notice of Effectiveness was issued April 25, 2012. The offer was deregistered on January 7, 2013 and none of the shares registered
were sold under the Registration Statement.
Market Risk
Disclosures
The Company
has not entered into derivative contracts either to hedge existing risks or for speculative purposes during the years ended December
31, 2013 and 2012, and the first fiscal quarter of 2014 ended March 31, 2014.
Off-balance
Sheet Arrangements and Contractual Obligations
The Company
does not have any off-balance sheet arrangements or contractual obligations as at reporting date, that are likely to have or are
reasonably likely to have a material current or future effect on the financial condition, changes in financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital resources that have not been disclosed in consolidated
financial statements.
Application
of Critical Accounting Policies
The accounting
policies and methods utilized in the preparation of the consolidated financial statements determine how the Company reports the
financial condition and results of operations and may require management to make estimates or rely on assumptions about matters
that are inherently uncertain. The accounting policies are described in Note 2 to the December 31, 2013 consolidated financial
statements. The accounting policies relating to mineral property and exploration costs, depreciation and amortization of property,
plant and equipment and stock-based compensation are critical accounting policies that are subject to estimates and assumptions
regarding future activities.
In 2007, the
Company's Board of Directors approved the 2007 Stock Option Plan (amended September 29, 2008) (“the Plan”) to offer
an incentive to obtain services of key employees, directors and consultants of the Company. The Plan provides for the reservation
for awards of an aggregate of 10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive
stock options exercisable for more than 500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise
price of an incentive stock option must be at least equal to 100% of the fair market value of the common stock on the date of
grant (110% of fair market value in the case of options granted to employees who hold more than 10% of the Company's capital stock
on the date of grant). The term of stock options granted under the Plan is not to exceed ten years and the stock options vest
immediately upon granting. The total fair value of options granted for during the reporting period are expensed in full as options
are vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model that takes
into account the exercise price, the expected life of the option, the share price at grant date and expected price volatility
of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate for the term of the option.
Due to the fact that the Company has not had significant options granted to develop historical data to provide a reasonable basis
to estimate Management utilizes the simplified method.
Buildings and
equipment are carried at cost (including development and preproduction costs, capitalized interest, other financing costs and
all direct administrative support costs incurred during the construction period, net of cost recoveries and incidental revenues),
less accumulated depletion and depreciation including write-downs. Following the construction period, interest, other financing
costs and administrative costs are expensed as incurred.
Buildings and
equipment utilized directly in commercial mining activities are depreciated, following the commencement of commercial production,
over their expected economic lives using either the unit-of-production method or the straight-line method.
41 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Depreciation
is provided over the following useful lives:
- |
Vehicles |
5
years |
- |
Office
equipment, furniture and fixtures |
2
to 10 years |
- |
Mining
equipment |
10
years |
The Company
reviews the carrying values of its buildings and equipment whenever events or changes in circumstances indicate that their carrying
values may not be recoverable. Impairment is considered to exist if total estimated future cash flows, or probability-weighted
cash flows on an undiscounted basis, are less than the carrying value of the assets.
An impairment
loss is measured and recorded based on discounted estimated future cash flows associated with values beyond proven and probable
reserves and resources. In estimating future cash flows, assets are grouped at the lowest level for which there is identifiable
future cash flows that are largely independent of cash flows from other asset groups. Generally, in estimating future cash flows,
all assets are grouped at a particular property for which identifiable cash flows exist. Buildings and equipment utilized directly
in commercial mining activities are depreciated, following the commencement of commercial production, over their expected economic
lives using either the unit-of-production method or the straight-line method.
The Company
accounts for its mineral properties on a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition
of the properties are capitalized. All sales and option proceeds received are first credited against the costs of the related
property, with any excess credited to earnings. Once commercial production has commenced, the net costs of the applicable property
will be charged to operations using the unit-of-production method based on estimated proven and probable recoverable reserves.
The net costs related to abandoned properties are charged to operations.
Exploration
costs are charged to operations as incurred until such time that proven reserves are delineated. From that time forward, the Company
will capitalize all costs to the extent that future cash flow from mineral reserves equals or exceeds the costs deferred. The
deferred costs will be amortized over the recoverable reserves when a property reaches commercial production. As at December 31,
2013 and 2012, the Company did not have proven reserves. Exploration activities conducted jointly with others are reflected at
the Company's proportionate interest in such activities.
The Company
reviews the carrying values of its mineral properties on a regular basis by reference to the project economics including the timing
of the exploration and/or development work, the work programs and the exploration results experienced by the Company and others.
The review of the carrying value of any producing property will be made by reference to the estimated future operating results
and net cash flows. When the carrying value of a property exceeds its estimated net recoverable amount, provision is made for
the decline in value.
The recoverability
of the amounts recorded for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation
of the Company’s interest in the underlying mineral claims, the ability of the Company to obtain the necessary financing
to successfully complete their development and the attainment of future profitable operations or proceeds from disposition.
Estimated costs
related to site restoration programs during the commercial development stage of the property are accrued over the life of the
project.
US GAAP requires
the Company to consider at the end of each accounting period whether or not there has been an impairment of the capitalized property,
plant and equipment. This assessment is based on whether factors that may indicate the need for a write-down are present. If management
determines there has been impairment then management is required to write-down the recorded value of the property, plant and equipment,
which reduces earnings and net assets.
42 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Related
Party Transactions
The proposed
business raises potential conflicts of interests between certain officers and directors of the Company. Certain directors are
directors of other mineral resource companies and, to the extent that such other companies may participate in ventures in which
the Company may participate, the directors may have a conflict of interest in negotiating and concluding terms regarding the extent
of such participation. In the event that such a conflict of interest arises at a meeting of the directors, a director who has
such a conflict will abstain from voting for or against the approval of such participation or such terms. In appropriate cases,
the Company will establish a special committee of independent directors to review a matter in which several directors, or management,
may have a conflict. From time to time, several companies may participate in the acquisition, exploration and development of natural
resource properties thereby allowing for their participation in larger programs, involvement in a greater number of programs and
reduction of the financial exposure with respect to any one program. It may also occur that a particular company will assign all
or a portion of its interest in a particular program to another of these companies due to the financial position of the company
making the assignment.
In determining
whether the Company will participate in a particular program and the interest therein to be acquired by it, the directors will
primarily consider the potential benefits to the Company, the degree of risk exposure and the financial position at that time.
Other than as indicated, the Company has no other procedures or mechanisms to deal with conflicts of interest. The Company is
unaware of the existence of any conflict of interest as described herein.
Other than
as disclosed below, during the periods ended December 31, 2013 and 2012, none of our current directors, officers or principal
shareholders, nor any family member of the foregoing, nor, to the best of our information and belief, any former directors, senior
officers or principal shareholders, nor any family member of such former directors, officers or principal shareholders, has or
had any material interest, direct or indirect, in any transaction, or in any proposed transaction which has materially affected
or will materially affect the Company.
There have
been no transactions or proposed transactions with officers and directors during the last two years to which the Company is a
party except as follows:
During year
ended December 31, 2013, consulting fees of $445,337 (December 31, 2012: $301,714) were incurred to directors and officers of
the Company and its subsidiary. The transactions were recorded at the exchange amount, being the value established and agreed
to by the related parties. Coresco also charged for geophysical consulting activities and other exploration management fees for
a total of $126,000 during the year ended December 31, 2013 (December 31, 2012: Coresco charged for S1 fund raising and geophysical
consulting activities for a total of $79,171).
Included in
accounts payable (related parties) and advances payable (related party) at December 31, 2013 is $42,800 (December 31, 2012: $158,220)
payable to officers and directors of the Company for consulting fees and various expenses incurred on behalf of the Company.
43 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
CURRENT
OUTLOOK
General
Economic Conditions
Current problems
in credit markets and deteriorating global economic conditions have lead to a significant weakening of exchange traded commodity
prices, including precious and base metal prices. Volatility in these markets is also high. It is difficult in these conditions
to forecast metal prices and demand trends for products to be produced if mining operations were current. Credit market conditions
have also increased the cost of obtaining capital and limited the availability of funds. Accordingly, management is reviewing
the effects of the current conditions on our business.
It is anticipated
that for the foreseeable future, the Company will rely on the equity markets and Option and Warrant holders to meet financing
requirements and continue to enter into debt settlements to preserve the Company’s capital reserves. The Company will also
consider entering into joint venture arrangements to advance its properties if a suitable opportunity presents.
Capital
and Exploration Expenditures
The Company
is reviewing capital and exploration spending in light of current market conditions. As a result of our review, the Company may
curtail a portion of our capital and exploration expenditures during 2014.
The Company
is currently concentrating our exploration activities in Brazil and examining data relating to the potential acquisition or joint
venturing of additional mineral properties in either the exploration or development stage.
Plans for
Next Twelve Months
The following
Plan of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results
could differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company may
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that the Company will be able to do so and the
Company does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and the Company has no history of earnings or cash flow from operations. While the Company may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of properties,
there is no assurance that any such activity will generate funds that will be available for operations.
44 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The planned
activity for 2014 year is as follows:
The following
Plan of Operation contains forward-looking statements that involve risks and uncertainties, as described below. The actual results
could differ materially from those anticipated in these forward-looking statements. During the next 12 months the Company may
raise additional funds through equity offerings and/or debt borrowing to meet the general and administrative operating expenses
and to conduct work on exploration properties. There is, of course, no assurance that the Company will be able to do so and the
Company does not have any agreements or arrangements with respect to any such financing. The exploration properties have not commenced
commercial production and the Company has no history of earnings or cash flow from operations. While the Company may attempt to
generate additional working capital through the operation, development, sale or possible joint venture development of properties,
there is no assurance that any such activity will generate funds that will be available for operations.
The Company
intends to concentrate exploration activities on the Brazilian Tapajos properties and examine data relating to the potential acquisition
or joint venturing of additional mineral properties in either the exploration or development stage in other South American countries.
Additional contractors and consultants may be hired on as and when the requirement occurs.
The exploration
work program for the Fiscal 2014 will focus on the Brazilian properties. The Company intends to follow up results from previous
work on the Sao Domingo property, including the previous drilling and mapping over the Fofoca resource area. Follow up evaluation
of the geophysical anomaly west of Fofoca is required to test any strike continuity of potential economic mineralization. The
Toucano occurrence will be the focus of channel and auger sampling and will be the focus of an elluvial and oxide small scale
production scenario. This is follow up detailed sampling was in response to the high grade gold results noted from the oxide insitu
material mapped during the 2012 and 2013 exploration phases.
Two grids were
cut through the Fofoca west extension area and the area encompassing the Toucano gold occurrence. These areas were systematically
sampled and results showed numerous and extensive zones of anomalous gold mineralization. Assays were submitted for ICP Multi
element analysis and results contoured onto plans for review. The results are being analysed for their patterns as related to
classic deposit types for the region. The strong variance in the copper anomalism noted between the Toucano grid and the Fofoca
grid will be reviewed in relation to the possible timing of mineralizing events at project scale and compared to similar styles
within the Tapajos region. The dispersion of the elements has greatly aided the morphological understanding of the lithologies
of the project area, and will assist the technical team in targeting subsurface follow up work during the 2014 season. Subsurface
exploration will include trenching and follow up drilling at both the Fofoca resource area and the initial drill testing at the
Toucano gold occurrence. The technical team are confident that the numerous gold occurrences on the Sao Domingo property will
be related to each other and that important path finder elements and structures will lead to more drill targets. The anticipated
results should delineate further areas for alluvial/elluvial mining and bulk sampling targets, as well as provide further resource
ounces at Toucano to compliment the current and expected increased resources at Fofoca.
Aurora continued
the project wide evaluation of tailings and alluvial/elluvial potential. Results showed that follow up test work is recommended
and Aurora has an application in place for a trial mining license to carry out bulk sampling of recovery potentially economic
material. Concurrently a technical team has been assembled to continue the evaluation of both the alluvial/elluvial potential
and the geometry of the hard rock mineralization in preparation for subsurface test work.
Results of
the follow up exploration during 2013 identified further primary and placer gold occurrences, which were subsequently sampled
for gold and associated minerals; cartographic archival data was reviewed, and follow on exploration recommendations and budgets
established.
The Company
has set up a field operations center at the Sao Domingos property and intend to continue to focus exploration activities on anomalies
associated with the Sao Domingos property. During 2013 the Company acquired approximately 60 acres of land on the fringe of the
Sao Domingo town ship and constructed an additional field base to house and service the increased staff and equipment. The new
field camp is located approximately 2 kilometers from the Sao Domingo technical office which is located in town center of Sao
Domingo. The Company selected the Săo Domingos property based on its proximity to the other properties, and the logistics
currently in place. Access to the Săo Domingos property is by light aircraft to a well-maintained strip, by road along the
government maintained Trans Garimpeiro highway, and by boat along the multitude of waterways in the Amazon Basin.
45 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The company
also intends to expand the current infrastructure on Sao Domingo to include further staff accommodation, office space, workshops
for heavy machinery and upgrade the current onsite laboratory for assaying. Currently the Company has a budget for exploration
and alluvial/elluvial mining, and is ready to utilise the trial mining license once issued. The exploration phase during 2013,
coupled with data from previous campaigns has shown the project has great potential to host significant economic alluvial/elluvial
and hard rock mineralization.
Aurora continues
to work closely with Haywood Securities Inc., as the Company’s advisors and sponsoring broker, to complete its application
for the Toronto Stock Exchange –Venture (TSX-V). Completion of the site visit by Geosure Geological Consultants from Australia,
the Company’s independent technical qualified person, marked the final stage of the independent technical report, NI43-101,
required for the new listing of Aurora.
46 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 7A
– QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Aurora is a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required
under this item.
ITEM 8 –
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Aurora’s
financial statements are stated in United States Dollars (USD) and are prepared in accordance with accounting principles generally
accepted in the United States of America. See Financial Statements attached within.
ITEM 9 –
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A
– CONTROLS AND PROCEDURES
Disclosure
Controls and Procedures
Attached as
exhibits to this Annual Report on Form 10-K are certifications from the Chief Executive Officer (CEO) and Chief Financial Officer
(CFO), which are required pursuant to Rule 13a-14 of the Exchange Act. This “Controls and Procedures” section of this
Annual Report on Form 10-K includes information concerning the controls and controls evaluation referenced in the certifications.
This section of the Annual Report on Form 10-K should be read in conjunction with the certifications for a more complete understanding
of the matters presented.
The Company
maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Securities
Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange
Commission (SEC) rules and forms, and that such information is accumulated and communicated to management, including our President
and Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), as appropriate,
to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management
recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives, as the Company’s are designed to do, and management necessarily was required to
apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Evaluation
of disclosure controls and procedures
The Company
evaluated the effectiveness of the design and operation of disclosure controls and procedures as of the end of the period covered
by this report, being, December 31, 2013. Disclosure controls and procedures are designed to ensure that information required
to be disclosed in reports filed under the Exchange Act, is recorded, processed, summarized and reported within the time periods
specified by the SEC. Disclosure controls are also designed to ensure that such information is accumulated and communicated to
management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.
Based on the
evaluation, our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our “disclosure
controls and procedures” (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), have concluded that the internal control
over disclosure controls were not effective as of December 31, 2013.
Management’s
annual report on internal control over financial reporting
The Company’s
Management is responsible for establishing and maintaining internal control over financial reporting, as such term is defined
in Exchange Act Rule 13a-15(f). Management evaluated, under the supervision and with the participation of our Chief Executive
Officer and Chief Financial Officer, the effectiveness of our internal control over financial reporting as of December 31,
2013.
47 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Based on its
evaluation under the framework in Internal Control—Integrated Framework, issued by the Committee of Sponsoring
Organizations of the Treadway Commission, management concluded that internal control over financial reporting was not effective
as of December 31, 2013, due to the existence of material weaknesses, as described in greater detail below. A material weakness
is a deficiency or a combination of deficiencies in internal control over financial reporting, such that there is a reasonable
possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a
timely basis.
This annual
report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal
control over financial reporting. Management’s report was not subject to attestation by the Company’s independent
registered public accounting firm pursuant to rules of the SEC that permit the Company to provide only management’s report
in this annual report.
Limitations
on Effectiveness of Controls
Management,
including our Chief Executive Officer and Chief Financial Officer, concluded that internal control over financial
reporting and disclosure controls and procedures were not effective at a reasonable assurance level. A control system, no matter
how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system
are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of
controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been
detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns
can occur because of a simple error or mistake. Additional controls can be circumvented by the individual acts of some persons,
by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based
in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed
in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of
changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations
in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
Material
Weaknesses Identified
In connection
with the preparation of the consolidated financial statements for the year ended December 31, 2013, certain deficiencies in internal
control became evident to management that represent material weaknesses, including:
| (i) | Lack
of a sufficient number of independent directors for our board and audit committee. The
Company currently has two independent directors on the board, which is comprised of 5
directors, and on the audit committee, which is comprised of 5 directors. As a publicly-traded
company, the Company should strive to have a majority of independent board of directors. |
| (ii) | Insufficient
segregation of duties in our finance and accounting functions due to limited personnel.
During the year ended December 31, 2013, the Company had two people on staff at our executive
office and two persons at the Brazil office that performed nearly all aspects of financial
reporting process, including, but not limited to, access to the underlying accounting
records and systems, the ability to post and record journal entries and responsibility
for the preparation of the financial statements. This creates certain incompatible duties
and a lack of review over the financial reporting process that would likely result in
a failure to detect errors in spreadsheets, calculations, or assumptions used to compile
the financial statements and related disclosures as filed with the SEC. These control
deficiencies could result in a material misstatement to interim or annual consolidated
financial statements that would not be prevented or detected. |
| (iii) | Insufficient
corporate governance policies. Although the Company has a code of ethics, which provides
broad guidelines for corporate governance, our corporate governance activities and processes
are not always formally documented. Specifically, decisions made by the board to be carried
out by management should be documented and communicated on a timely basis to reduce the
likelihood of any misunderstandings regarding key decisions affecting our operations
and management. |
| (iv) | Accounting
for Non-Standard Transactions. Occasionally the Company enters into transactions
that are more complex from an accounting perspective. These transactions by their
nature require greater technical accounting expertise and greater consideration of the
related facts and circumstances to ensure that the accounting and reporting are accurate
and in accordance with generally accepted accounting principles. |
48 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Plan for
Remediation of Material Weaknesses
The Company
intends to take appropriate and reasonable steps to make the necessary improvements to remediate these deficiencies. The Company
intends to consider the results of the remediation efforts and related testing as part of our year-end 2014 assessment of the
effectiveness of internal control over financial reporting. The Company has implemented certain remediation measures and is in
the process of designing and implementing additional remediation measures for the material weaknesses described in this Annual
Report on Form 10-K. Such remediation activities include the following:
| - | The
Company continues to recruit one or more additional independent board members to join
the board of directors. |
| - | In
addition to the foregoing remediation efforts, the Company will continue to update the
documentation of internal control processes, including formal risk assessment of financial
reporting processes. |
Changes
in Internal Controls over Financial Reporting
There were
no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act) during the quarter ended December 31, 2013, that materially affected, or are reasonably likely to materially
affect, the internal control over financial reporting.
ITEM 9B
– OTHER INFORMATION
None.
49 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
PART
III
ITEM 10
– DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
| a. | Identify
Directors and Executive Officers |
The following
table and text sets forth the names and ages of all directors and executive officers of the Company as of March 31, 2014. All
of the directors will serve until the next annual meeting of stockholders and until their successors are elected and qualified,
or until death, retirement, resignation or removal. There are no family relationships between or among the directors, executive
officers or persons nominated or charged by the Company to become directors or executive officers. Executive officers serve at
the discretion of the Board of Directors, and are appointed to serve by the Board of Directors. Also provided herein are brief
descriptions of the business experience of each director and executive officer during the past five years and an indication of
directorships held by each director in other companies subject to the reporting requirements under the Federal securities laws.
The Board of
Directors currently consists of five (5) members. Directors serve for a term of one year and stand for election at the annual
meeting of stockholders. Pursuant to our Bylaws, any vacancy occurring in the board of directors, including a vacancy created
by an increase in the number of directors, may be filled by the stockholders or by the affirmative vote of a majority of the remaining
directors through less than a quorum of the board of directors. A director elected to fill a vacancy shall hold office only until
the next election of directors by the stockholders. If there are no remaining directors, the vacancy shall be filled by the stockholders.
Name
and Address |
|
Age
and Position |
Lars
M. Pearl
Hofnerstrasse
13
6314
Unterageri, Switzerland |
|
Age
52, President, CEO and Director appointed April 27, 2007. |
Agustin
Gomez de Segura
c.Kerria
32, 3A Alcobendas
Soto
de la Moraleja
E-28109,
Madrid, Spain |
|
Age
59, Director appointed November 15, 2010. |
Ross
M Doyle
16
Erlibergstrasse
6314
Unterageri, Switzerland |
|
Age
41, Director and CFO appointed October 11, 2011 and resigned as a Director on October 10, 2013 (continues as CFO) |
Vladimir
Bernshtein
11,
Minskaya St.
Moscow
121108, Russia |
|
Age
37, Director and Chief Development Officer, Appointed October 5, 2012 |
Andrey
Rastko
70A,
Yudahina Str.
Bishkek
720044, Kyrgyz Republic |
|
Age
59, Director and Chief Technology Officer, Appointed October 5, 2012 |
Gorden
Glenn
701–2045
Lake Shore Blvd, Toronto, ON M8V 2Z6, Canada |
|
Age
49, Director, Appointed September 25, 2013 |
The following
is a description of the employment history for each of the directors and officers for the last five years:
Lars Pearl,
51, President, Director and Chief Executive Officer of Cigma Metals Corporation (2004 to 2008); Mr Pearl has been self employed
as a geological consultant from 1993 to 2004. Mr Pearl has spent over 10 years as a geological consultant to properties in Australia,
Tanzania, Russia, Kazakhstan, Peru, Colombia and Ecuador. During the last 5 years Mr Pearl was acting as a consultant geologist
to various companies, including Aurora Gold Corporation, Cigma Metals Corporation, Carnavale Resources Ltd and De Beira Goldfields
in Australia, Brazil, Peru, Ecuador and Tanzania before joining the board of Aurora Gold Corporation in April 2007. Mr Pearl devotes
approximately 80% of his time dealing with the affairs of Aurora Gold. Mr Pearl received a Bachelor of Applied Geology degree
from the University of Technology, Sydney Australia in 1993. Mr Pearl’s extensive experience, training and education as
a geologist and his experience with other resources exploration companies make him particularly qualified to serve as an Aurora
director.
50 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Agustin
Gomez de Segura, 58 was awarded a Diploma in Engineering in Physical Chemistry from the Moscow Technological University "MISA"
(former Moscow Institute for Steel and Alloys). Mr Gomez de Segura also completed 4 years of a Doctorate in Metal's Physics at
Moscow Technological University. Mr Gomez de Segura has had several senior roles in publicly listed companies. Mr Gomez de Segura's
positions both past and present include: Director for Labtam Information & Scientific Instruments (Australia) from 1983 till
1990 and he was the Chairman of Advisory Board of Alina Bank (Russia) from 1994 till 1997. Mr Gomez de Segura’s extensive
scientific experience, training and education and his overall business experience make him particularly qualified to serve as
an Aurora director.
Ross Doyle,
41 was awarded a Bachelor of Commerce in 1991 from the University of Queensland, Australia and qualified as a Chartered Accountant
in 1995. Mr Doyle has had several senior roles including 9 years commodities experience at Glencore. Mr Doyle’s extensive
commodity, technology and corporate financing experience make him particularly qualified to serve as an Aurora officer.
Valadimir
Bernshtein has been active in the mining industry with Alltech Investments Limited since 2004 and as the Investment Director
since 2008. During this time Mr Bernshtein has been involved in various Alltech projects including Oil &
Gas exploration in Western Siberia, Sakhalin Island and Kamchatka and Gold exploration in Kyrgyzstan.
Andrey Rastko
is a geologist with vast experience within the exploration and mining sector having worked in Africa and the Commonwealth
of Independent States. Currently Mr Ratsko is the Director General of TK Geo Resource which holds licenses for precious
and base metals in the Chuy region of the Kyrgyz Republic.
Gorden Glenn
has been a director of Aurora since September 25, 2013. For the past 2 years Mr Glenn has been a corporate director and is
currently the Interim President and CEO of Auriga Gold Corporation. Mr. Glenn intends to devote approximately 20% of his business
time to the affairs of Aurora. Mr. Glenn is a director of the following reporting reporting issuers; Entrée Gold Corporation
(ETG-TSXV), Auriga Gold Corp (AIA-TSXV), Source Exploration Limited (SOP-TSXV) and Geodex Exploration (GXM-TSXV).
51 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Consideration
of Director Nominees
Director
Qualifications
The Company
believes that the Board, to the extent that limited resources permit, should encompass a diverse range of talent, skill and expertise
sufficient to provide sound and prudent guidance with respect to the Company's operations and interests. Each director also is
expected to: exhibit high standards of integrity, commitment and independence of thought and judgment; use their skills and experiences
to provide independent oversight to the business; participate in a constructive and collegial manner; be willing to devote sufficient
time to carrying out their duties and responsibilities effectively; devote the time and effort necessary to learn the business
requirements and represent the long-term interests of all shareholders.
The Board has
determined that the Board of Directors as a whole must have the right diversity, mix of characteristics and skills for the optimal
functioning of the Board in its oversight of our affairs. The Board believes it should be comprised of persons with skills in
areas such as: finance; real estate; banking; strategic planning; human resources and diversity; leadership of business organizations;
and legal matters. The Board may also consider in its assessment of the Board's diversity, in its broadest sense, reflecting,
but not limited to, age, geography, gender and ethnicity.
In addition
to the targeted skill areas, the Board looks for a strong record of achievement in key knowledge areas that it believes are critical
for directors to add value to the Board, including:
| - | Strategy—knowledge
of the business model, the formulation of corporate strategies, knowledge of key competitors
and markets; |
| - | Leadership—skills
in coaching and working with senior executives and the ability to assist the Chief Executive
Officer; |
| - | Organizational
Issues—understanding of strategic implementation, change management processes,
group effectiveness and organizational design; |
| - | Relationships—understanding
how to interact with investors, accountants, attorneys, management companies, analysts
and communities in which the Company operates; |
| - | Functional—understanding
of finance matters, financial statements and auditing procedures, technical expertise,
legal issues, information technology and marketing; and |
| - | Ethics—the
ability to identify and raise key ethical issues concerning the Company’s activities
and those of senior management as they affect the business community and society. |
52 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The Board
and Board Meetings
The Board of
directors consists of five members [2012: five members]. Directors serve for a term of one (1) year and stand for election at
the annual meeting of stockholders. Pursuant to the Bylaws, any vacancy occurring in the Board of directors, including a vacancy
created by an increase in the number of directors, may be filled by the stockholders or by the affirmative vote of a majority
of the remaining directors through less than a quorum of the Board of directors. A director elected to fill a vacancy shall hold
office only until the next election of directors by the stockholders. If there are no remaining directors, the vacancy shall be
filled by the stockholders.
At a meeting
of stockholders, any director or the entire Board of directors may be removed, with or without cause, provided the notice of the
meeting states that one of the purposes of the meeting is the removal of the director. A director may be removed only if the number
of votes cast to remove him exceeds the number of votes cast against removal.
The Board of
Directors and management are committed to responsible corporate governance to ensure that the Company is managed for the long-term
benefit of its shareholders. To that end, the Board of Directors and management periodically review and update, as appropriate,
the corporate governance policies and practices. In so doing, the Board and management review published guidelines and recommendations
of institutional shareholder organizations and current best practices of similarly situated public companies. The Board of Directors
and management also regularly evaluate and, when appropriate, revise corporate governance policies and practices in accordance
with the requirements of the Sarbanes-Oxley Act of 2002 and the rules and listing standards issued by the SEC.
During the
year ended December 31, 2013, the Board held a total of two (2) meetings. All members of the Board attended all meetings of the
Board where a present entitlement existed.
Directors’
and Officers’ Liability Insurance
The Company
does not currently maintain directors’ and officers’ liability insurance coverage. The Company is currently reviewing
insurance policies and anticipates obtaining coverage for board of directors and officers.
Board Committees
and Corporate Governance
Audit Committee
The Board formed
an independent standing Audit Committee on October 9, 2012. Whilst a Charter is yet to be established, the Audit Committee monitors financial
reporting processes and internal control systems and appoint the independent registered public auditing firm. The members of the
committee are Gorden Glenn, Andrey Rastko and Agustin Gomez de Segura.
Compensation
Committee
The Board does
not currently have an independent standing Compensation Committee. The full Board establishes overall compensation
policies for the Company and Directors and reviews recommendations submitted by management.
Nominating
Committee
The Board does
not currently have an independent standing Nominating Committee. All nominating functions are handled directly by the full Board
of Directors, which the Board believes is the most effective and efficient approach, based on the size of the Board and the current
and anticipated operational requirements. As outlined above in selecting a qualified nominee, the Board considers such factors
as it deems appropriate which may include: the current composition of the Board; the range of talents of the nominee that would
best complement those already represented on the Board; the extent to which the nominee would diversify the Board; the nominee's
standards of integrity, commitment and independence of thought and judgment; and the need for specialized expertise.
53 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Legal Proceedings
During the
past ten years none of the directors, executive officers, promoters or control persons has been:
| - | the
subject of any bankruptcy petition filed by or against any business of which such person
was a general partner or executive officer either at the time of the bankruptcy or within
two years prior to that time; |
| - | convicted
in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic
violations and other minor offenses); |
| - | subject
to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of
any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending
or otherwise limiting his involvement in any type of business, securities or banking
activities; |
| - | found
by a court of competent jurisdiction (in a civil action), the Commission or the Commodity
Futures Trading Commission to have violated a federal or state securities or commodities
law; |
| - | the
subject of any Federal or State judicial or administrative order, judgment, decree, or
finding, not subsequently reversed, suspended or vacated, relating to an alleged violation
of: |
| - | any
Federal or State securities or commodities law or regulation; or |
| - | any
law or regulation respecting financial institutions or insurance companies including,
but not limited to, a temporary or permanent injunction, order of disgorgement or restitution,
civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition
order; or |
| - | any
law or regulation prohibiting mail or wire fraud or fraud in connection with any business
entity. |
| - | any
federal or state judicial or administrative proceedings based on violations of federal
or state securities, commodities, banking or insurance laws and regulations, or any settlement
to such actions (excluding settlements between private parties); and |
| - | any
disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange
or other self-regulatory organization. |
Code of
Ethics
The Company
has adopted a Code of Ethics that applies to all officers, directors and employees, including its Chief Financial Officer and
Chief Executive Officer, which complies with the requirements of the Sarbanes-Oxley Act of 2002 and applicable Financial Industry
Regulatory Authority listing standards. Accordingly, the Code of Ethics is designed to deter wrongdoing, and to promote, among
other things, honest and ethical conduct, full, timely, accurate and clear public disclosures, compliance with all applicable
laws, rules and regulations, the prompt internal reporting of violations of the Code of Ethics, and accountability.
Corporate
Governance
The Company
has adopted Corporate Governance Guidelines applicable to the Board of Directors.
Board Leadership
Structure
The Company
currently has four (4) executive officers and five (5) directors. The Board of Directors has reviewed the Company’s current
Board leadership structure, which consists of a Chief Executive Officer and a Chief Financial Officer, in light of the composition
of the Board, the Company’s size, the nature of the Company’s business, the regulatory framework under which the Company
operates, the Company’s stockholder base, the Company’s peer group and other relevant factors, and the Company has
determined that this structure is currently the most appropriate Board leadership structure for the company. Nevertheless, the
Board intends to carefully evaluate from time to time the requirements of the business to ensure the structure best supports the
stockholders.
Board Role
in Risk Oversight
Risk is inherent
in every business and how well a business manages risk can ultimately determine success. The Company faces a number of risks,
including strategic risks, enterprise risks, financial risks, and regulatory risks. While management is responsible for day to
day management of various risks faced, the Board of Directors, as a whole, is responsible for evaluating the exposure to risk
and to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as
designed. The Board reviews and discusses policies with respect to risk assessment and risk management. The Board also has oversight
responsibility with respect to the integrity of the Company’s financial reporting process and systems of internal control
regarding finance and accounting, as well as the financial statements.
54 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Director
Independence
The securities
are not listed on a U.S. securities exchange and, therefore, the Company is not subject to the corporate governance requirements
of any such exchange, including those related to the independence of directors. However, at this time, after considering all of
the relevant facts and circumstances, our Board of Directors has determined that Mr. Agustin Gomez de Segura and Gorden Glenn
are independent from management and qualify as an “independent director” under the standards of independence under
the applicable FINRA listing standards. Upon listing on any national securities exchange or any inter-dealer quotation system,
it will elect such independent directors as is necessary under the rules of any such securities exchange.
Certain
Relationships
There are no
family relationships among or between any of the officers and directors.
The proposed
business raises potential conflicts of interests between certain officers and directors and the Company. Certain directors are
directors of other mineral resource companies and to the extent that such other companies may participate in ventures in which
the Company may participate, the directors may have a conflict of interest in negotiating and concluding terms regarding the extent
of such participation. In the event that such a conflict of interest arises at a meeting of directors, a director who has such
a conflict will abstain from voting for or against the approval of such participation or such terms. In appropriate cases, the
Company will establish a special committee of independent directors to review a matter in which several directors, or management,
may have a conflict. From time to time, several companies may participate in the acquisition, exploration and development of natural
resource properties thereby allowing for their participation in larger programs, involvement in a greater number of programs and
reduction of the financial exposure with respect to any one program. It may also occur that a particular company will assign all
or a portion of its interest in a particular program to another of these companies due to the financial position of the company
making the assignment.
In determining
whether the Company will participate in a particular program and the interest therein to be acquired by it, the directors will
primarily consider the potential benefits to us, the degree of risk to which the Company may be exposed and its financial position
at that time. Other than as indicated, the Company has no other procedures or mechanisms to deal with conflicts of interest. The
Company is not aware of the existence of any conflict of interest as described herein.
Compensation
of Directors
The Board of
Directors determines the non-employee directors’ compensation for serving on the Board and its committees. In establishing
director compensation, the Board is guided by the following goals:
| - | Compensation
should consist of a combination of cash and equity awards that are designed to fairly
pay the directors for work required for a company of our size and scope; |
| - | Compensation
should align the directors’ interests with the long-term interests of stockholders;
and |
| - | Compensation
should assist with attracting and retaining qualified directors. |
During 2013
Agustin Gomez de Segura was paid a $36,000 director’s fee (2012: $27,000). Directors are entitled to participate in, and
have been issued options under, the 2007 Stock Plan (as amended 29 September 2008). The Company also reimburses directors for
any actual expenses incurred to attend meetings of the Board or travel upon request of the Company.
The following
table reports all compensation the Company paid to non-employee directors, in their capacity as members of the Board, during the
fiscal years 2013 and 2012 inclusive:
55 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
For Year Ended December 31 | |
2013 | | |
2012 | |
Agustin Gomez de Segura | |
| 36,000 | | |
| 27,000 | |
Valadimir Bernshtein | |
| 82,000 | | |
| 18,000 | |
Andrey Rastko | |
| 82,000 | | |
| 18,000 | |
Gorden Glenn | |
| 7,337 | | |
| - | |
Standard
Arrangements
During fiscal
2013 the Company accrued $10,800 for Chairman’s fees (Fiscal 2012: $10,800). The Company reimburses directors for reasonable
expenses incurred for attending meetings of the Board of Directors.
ITEM 11
– EXECUTIVE COMPENSATION
The responsibility
for establishing, administering and interpreting the policies governing the compensation and benefits for the executive officers
lies with the Board of Directors. In this regard the Board has not retained the services of any compensation consultants.
The goals of
the executive compensation program are to attract, motivate and retain individuals with the skills and qualities necessary to
support and develop the business within the framework of size and resource availability. During fiscal year 2013, the Company
designed executive compensation program to achieve the following objectives:
| - | attract
and retain executives experienced in the resource exploration industry; |
| - | motivate
and reward executives whose experience and skills are necessary to the Company’s
ultimate success; |
| - | reward
performance as warranted; and align the interests of the executive officers and stockholders
by motivating executive officers to increase stockholder value. |
56 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
SUMMARY COMPENSATION TABLE
The following
table summarizes the compensation earned by the Named Executive Officers during the fiscal years ended December 31, 2013, and
2012:
Name
and principal position |
|
Year |
|
Salary
($) |
|
Bonus
($) |
|
Stock
Awards
($) |
|
Option
Awards
($) |
|
Non-Equity
Incentive
Plan
($) |
|
Non-qualified
Deferred
Compensation
Earnings ($) |
|
All
other
compensation
($) |
|
Total
($) |
Lars
M Pearl[1]
(President,
CEO, Director) |
|
2012
2013 |
|
126,004
132,000 |
|
-
- |
|
-
- |
|
21,840
- |
|
-
- |
|
-
- |
|
-
- |
|
147,844
132,000 |
Ross
Doyle[2]
(Director,
CFO)[3] |
|
2012
2013 |
|
112,710
106,000 |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
112,710
106,000 |
Valadimir Bernshtein
(Director, Chief Development Officer)[4] |
|
2012
2013 |
|
18,000
82,000 |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
18,000
82,000 |
Andrey
Rastko
(Director,
Chief Technology Officer)[5] |
|
2012
2013 |
|
18,000
82,000 |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
-
- |
|
18,000
82,000 |
No officers
or directors are subject to an employment agreement with the Company, except for Lars Pearl who is entitled to a 6 month termination
payment of CHF12,000 per month. The entire Board of Directors sets the current year compensation levels of each of the above named
Executive Officers.
1
In Q4 2011 Lars Pearl debt settled for equity in the Company.
2
Effective October 11, 2011, Mr Doyle’s consulting company entered into a services agreement pursuant to which Mr Doyle’s
company will be serving at the Company’s Chief Financial Officer. Global Strategic Synergies AG will be paid a monthly service
fee of 10,000 Swiss Francs. The services agreement may be terminated by either party upon advanced written notice to the other
party of 20 business days.
3 On October 10, 2013
Ross Doyle resigned as a Director
4
Valadimir Bernshtein was appointed October 5, 2012.
5
Andrey Rastko was appointed October 5, 2012.
57 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Options/SAR
Grants Table
In 2007, the
Board of Directors approved the 2007 Stock Option Plan (the “Plan”) which was subsequently approved by the
shareholders in July 2007 and amended in September 2008, to offer an incentive to obtain services of key employees, directors
and consultants of the Company. The Plan provides for the reservation for awards of an aggregate of 10% of the total shares of
Common Stock outstanding from time to time. No Plan participant may receive stock options exercisable for more than 2,500,000
shares of Common Stock in any one calendar year. Under the Plan, the exercise price of an incentive stock option must be at least
equal to 100% of the fair market value of the common stock on the date of grant (110% of fair market value in the case of options
granted to employees who hold more than 10% of our capital stock on the date of grant). The term of stock options granted under
the Plan is not to exceed ten years and the stock options vest immediately upon granting.
The Company
awarded stock purchase options to the directors and officers of the Company and others during the fiscal years as set out below.
| |
Stock Options # | | |
Exercise Price Ranges $ | |
Outstanding and exercisable at December 31, 2011 | |
| 1,810,000 | | |
| 0.25-1.30 | |
| |
| | | |
| | |
Forfeited during the fiscal year 2012 | |
| 240,000 | | |
| 1.30 | |
Granted during the fiscal year 2012 | |
| 360,000 | | |
| 0.325-
0.25 | |
Outstanding and exercisable at December 31, 2012 | |
| 1,930,000 | | |
| — | |
| |
| | | |
| | |
Forfeited during the fiscal year 2013 | |
| — | | |
| — | |
Granted during the fiscal year 2013 | |
| — | | |
| — | |
Outstanding and exercisable at December 31, 2013 | |
| 1,930,000 | | |
| 0.25-0.60 | |
The following
is a summary of stock options granted and the status of stock options outstanding and exercisable at December 31, 2013 (there
are no Stock Awards):
Option
Awards | |
| | |
| | |
| | |
| | |
|
Name | |
Number of Securities Underlying
Unexercised Options Exercisable (#) | | |
Number of Securities Underlying
Unexercised Options Unexercisable (#) | | |
Number of Securities Underlying
Unexercised Unearned
Options (#) | | |
Option
Exercise
Price per
Share ($) | | |
Option Expiration Date |
Lars Pearl | |
| 200,000 | | |
| — | | |
| — | | |
$ | 0.60 | | |
October 10, 2016 |
Agustin Gomez de Segura | |
| 200,000 | | |
| — | | |
| — | | |
$ | 0.60 | | |
October 10, 2016 |
Ross Doyle | |
| 200,000 | | |
| — | | |
| — | | |
$ | 0.60 | | |
October 10, 2016 |
Joseph Sierchio | |
| 40,000 | | |
| — | | |
| — | | |
$ | 0.60 | | |
October 10, 2016 |
Coresco AG | |
| 200,000 | | |
| — | | |
| — | | |
$ | 0.60 | | |
October 10, 2016 |
Lars Pearl | |
| 250,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
November 23, 2016 |
Agustin Gomez de Segura | |
| 220,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
November 23, 2016 |
Ross Doyle | |
| 220,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
November 23, 2016 |
Luis Mauricio | |
| 40,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
November 23, 2016 |
Lars Pearl | |
| 160,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
January 17, 2017 |
Agustin Gomez de Segura | |
| 160,000 | | |
| — | | |
| — | | |
$ | 0.25 | | |
January 17, 2017 |
Global Strategic Synergies Pty Ltd | |
| 40,000 | | |
| — | | |
| — | | |
$ | 0.32 | | |
April 9, 2017 |
Total | |
| 1,930,000 | | |
| | | |
| | | |
| | | |
|
58 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Aggregated
Option/SAR Exercises and Fiscal Year-End Option/SAR Value Table
At December
31, 2013 the Company had 1,930,000 (2012: 1,930,000) stock purchase options outstanding. At no time during the last completed
fiscal year did the Company, while a reporting company pursuant to Section 13(a) of 15(d) of the Exchange Act, adjust or amend
the exercise price of the stock options or SARs previously awarded to any of the named executive officers, whether through amendment,
cancellation or replacement grants, or any other means.
Long-Term
Incentive Plans
There are no
arrangements or plans in which the Company provide pension, retirement or similar benefits for directors or executive officers,
except that the directors and executive officers may receive stock options at the discretion of the Board of Directors. The Company
does not have any material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to
our directors or executive officers, except that stock options may be granted at the discretion of our Board of Directors.
The Company
has no plans or arrangements in respect of remuneration received or that may be received by executive officers to compensate such
officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of
responsibilities following a change of control, where the value of such compensation exceeds $60,000 per executive officer, except
for Lars Pearl who is entitled to a 6 month termination payment of CHF12,000 per month.
Compensation
of Directors
The Company
reimburses directors for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings
of board of directors. The board of directors may award special remuneration to any director undertaking any special services
other than services ordinarily required of a director. Only the Chairman and no other director received and/or accrued any compensation
for their services as a director, including committee participation and/or special assignments, or incurred in connection with
attending board meetings in Fiscal 2010. During Fiscal 2013, $36,000 was paid for services rendered to the Chairman (Fiscal 2012:
$27,000 and $40,000 was paid for services rendered to the Chairman).
Employment
Contracts
During the
year ended December 31, 2013, consulting fees of $445,337 (2012: $301,714) were incurred to directors and officers of the Company
and its subsidiary. The transactions were recorded at the exchange amount, being the value established and agreed to by the related
parties.
There are no
arrangements or plans in which the Company provides pension, retirement or similar benefits for directors or executive officers.
The directors and executive officers may receive stock options at the discretion of the board of directors and are incentivised
to pursue capital raising activities. The Company does not have any material bonus or profit sharing plans pursuant to which cash
or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at
the discretion of our board of directors.
The Company
has no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate
such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change
of responsibilities following a change of control, where the value of such compensation exceeds $60,000 per executive officer
(except for Lars Pearl who is entitled to a 6 month termination payment of CHF12,000 per month).
59 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 12
– SECURITY OWNERSHIP OF CERTAIN BENEFICIAL HOLDERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following
table sets forth certain information regarding the beneficial ownership of common stock as of March 31, 2014, by (i) each person
who is known by the Company to beneficially own more than five percent (5%) of outstanding common stock; (ii) each of the directors
and officers; and (iii) all directors and officers as a group. As at March 31, 2014, 51,188,990 shares of common stock were issued
and outstanding.
Name and Address of Beneficial Owner | |
Amount and Nature of Beneficial
Owner | | |
Percentage of Class (%) | |
| |
| | |
| |
Alltech Capital Limited 59/63 Line Wall Road, PO Box 199 Gibraltar | |
| 29,720,000 | | |
| 54.55 | % |
| |
| | | |
| | |
Officers and Directors | |
| | | |
| | |
Agustin Gomez de Segura c.Kerria 32, 3A Alcobendas
Soto de la Moraleja, E-28109, Madrid, Spain | |
| 1,245,780 | | |
| 2.29 | % |
| |
| | | |
| | |
Lars M. Pearl Hofnerstrasse 13 6314 Unterageri,
Switzerland | |
| 1,980,982 | | |
| 3.64 | % |
| |
| | | |
| | |
Ross Doyle 16 Erlibergstrasse
6314 Unteraegeri Switzerland | |
| 1,358,490 | | |
| 2.49 | % |
Directors and Officers as a group (3 persons) | |
| 31,585,253 | | |
| 61.02 | % |
The above is
calculated pursuant to rule 13d-3(d) of the Exchange Act. Beneficial ownership is calculated based on 54,478,990 shares of common
stock issued and outstanding on a fully diluted basis as of March 31, 2014. Under Rule 13d-3(d) shares not outstanding which are
subject to options, warrants, rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose
of calculating the number and percentage owned by such person, but are not deemed outstanding for the purpose of calculating the
percentage owned by each other person listed.
On
October 5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price
of $5,000,000, to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and
the Alltech Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common
stock of approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction,
the Company agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected
by the Investor. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors
of the Company. Additionally, Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
On
August 15, 2013, an Information Statement was filed with the Securities and Exchange Commission and was mailed or otherwise furnished
to the registered stockholders of Aurora in connection with the prior approval by the board of directors of Aurora, and receipt
by the board of approval by written consent of the holders of a majority of Aurora’s outstanding shares of common stock,
of a resolution to:
| - | Approve
a consolidation of the issued and outstanding shares of common stock of Aurora, without
correspondingly decreasing the number of authorized shares of common stock, on a five
“old” shares for every one “new” share basis, which will result
in a decrease of Aurora’s issued and outstanding share capital from 249,144,706
shares to approximately 49,828,942 shares of common stock, not including any rounding
up of fractional shares to be issued on consolidation; |
| - | Approve
a change of the par value of the shares of common stock of Aurora from a pre-consolidated
par value of $0.001 per share to an amended par value of $0.005 per share; and |
60 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| - | Amend
Article Four of the Articles of Aurora as follows “FOURTH. The authorized capital
stock of this Corporation shall consist of 300 Million (300,000,000) shares of common
stock with a par value of $0.005 per share.” |
Section
228 of the Delaware General Corporation Law and the By-laws of Aurora provide that any action required or permitted to be taken
at a meeting of the stockholders may be taken without a meeting if stockholders holding at least a majority of the voting power
sign a written consent approving the action. On July 24, 2013, the board of directors of Aurora approved and recommended the Resolutions.
Subsequently, the holders of a majority of the voting power signed and delivered to Aurora written consents representing at least
57.4% of the voting shares of common stock approving the Resolutions, in lieu of a meeting. Since the holders of the required
majority of shares of common stock have approved the Resolutions, no other votes are required or necessary and no proxies are
being solicited with this Information Statement. Aurora has obtained all necessary corporate approvals in connection with the
Resolutions and your consent is not required and is not being solicited in connection with the approval of the Resolutions. The
Information Statement was furnished solely for the purpose of informing stockholders in the manner required under the Securities
Exchange Act of 1934 of these corporate actions before they take effect. The Resolutions will not become effective until (i) the
date the Company receives confirmation from FINRA regarding the approval and effective date of the corporate action, or, (ii)
such later date as approved by the board of directors, in its sole discretion. The Certificate of Amendment was filed with the
Secretary of State of Delaware and became effective October 22, 2013,
Stock options
awarded for the aforementioned directors and officers are summarised in the below table. The options are exercisable at any time
from the grant date up to and including the expiry date.
Name | |
Number | | |
Granted | |
Exercise Price | | |
Expiry Date |
Lars M Pearl | |
| 200,000 | | |
October 11, 2011 | |
$ | 0.60 | | |
October 10, 2016 |
Lars M Pearl | |
| 250,000 | | |
November 24, 2011 | |
$ | 0.25 | | |
November 23, 2016 |
Lars M Pearl | |
| 160,000 | | |
January 13, 2012 | |
$ | 0.25 | | |
January 17, 2017 |
Agustin Gomez de Segura | |
| 200,000 | | |
October 11, 2011 | |
$ | 0.60 | | |
October 10, 2016 |
Agustin Gomez de Segura | |
| 220,000 | | |
November 24, 2011 | |
$ | 0.25 | | |
November 23, 2016 |
Agustin Gomez de Segura | |
| 160,000 | | |
January 13, 2012 | |
$ | 0.25 | | |
January 17, 2017 |
Ross Doyle | |
| 200,000 | | |
October 11, 2011 | |
$ | 0.60 | | |
October 10, 2016 |
Ross Doyle | |
| 220,000 | | |
November 24, 2011 | |
$ | 0.25 | | |
November 23, 2016 |
Changes
in Control
On
October 5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price
of $5,000,000, to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and
the Alltech Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common
stock of approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction,
the Company agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected
by the Investor. The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors
of the Company. Additionally, Mr. Bernshtein has been named as the Company’s Chief Development Director.
There were
other no arrangements during the last completed fiscal year or subsequent period to March 31, 2014, which resulted in a change
in control.
61 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 13
– CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
The proposed
business raises potential conflicts of interests between certain of officers and directors of the Company. Certain directors are
directors of other mineral resource companies and, to the extent that such other companies may participate in ventures in which
the Company may participate, the directors may have a conflict of interest in negotiating and concluding terms regarding the extent
of such participation. In the event that such a conflict of interest arises at a meeting of directors, a director who has such
a conflict will abstain from voting for or against the approval of such participation or such terms. In appropriate cases, the
Company will establish a special committee of independent directors to review a matter in which several directors, or management,
may have a conflict. From time to time, several companies may participate in the acquisition, exploration and development of natural
resource properties thereby allowing for their participation in larger programs, involvement in a greater number of programs and
reduction of the financial exposure with respect to any one program. It may also occur that a particular company will assign all
or a portion of its interest in a particular program to another of these companies due to the financial position of the company
making the assignment.
In determining
whether the Company will participate in a particular program and the interest therein to be acquired, the directors will primarily
consider the potential benefits to the Company, the degree of risk exposure and the financial position at that time. Other than
as indicated, the Company has no other procedures or mechanisms to deal with conflicts of interest. The Company is not aware of
the existence of any conflict of interest as described herein.
Transactions
with Related Persons
Other than
as disclosed below, during the fiscal years ended December 31, 2013 and 2012, none of the current directors, officers or principal
shareholders, nor any family member of the foregoing, nor, to the best of our information and belief, any of our former directors,
senior officers or principal shareholders, nor any family member of such former directors, officers or principal shareholders,
has or had any material interest, direct or indirect, in any transaction, or in any proposed transaction which has materially
affected or will materially affect the Company.
There have
been no transactions or proposed transactions with officers and directors during the last two years to which the Company is a
party except as follows:
During the
year ended December 31, 2013, consulting fees of $445,337 (2012: $301,714) were paid to directors and officers of the Company
and its subsidiary. The transactions were recorded at the exchange amount, being the value established and agreed to by the related
parties. Coresco also charged for S1 fund raising and geophysical consulting activities for a total of $79,171 during the 2012
year.
62 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
ITEM 14
– PRINCIPAL ACCOUNTING FEES AND SERVICES
Audit Fees
The aggregate
fees billed and expected to be billed for professional services by Peterson Sullivan LLP for the audit of annual consolidated
financial statements and review of consolidated financial statements included in Form 10-Q (17 CFR 249.308b) or services that
were normally provided by the accountant in connection with statutory and regulatory filings or engagements for the 2013 fiscal
year are $36,000 (2012: $36,000).
Audit-Related
Fees
The aggregate
fees billed for assurance and related services by Peterson Sullivan LLP that are reasonably related to the performance of the
audit or review of consolidated financial statements and are not reported under audit fees for fiscal 2013 were $0 (2012: $0).
Tax Fees
The aggregate
fees billed for professional services by Peterson Sullivan LLP for tax compliance for fiscal 2012 were $3,000 (2012: $3,000).
All Other
Fees
The aggregate
fees billed for products and services provided by Peterson Sullivan LLP, other than reported under Audit Fees, Audit-Related Fees
and Tax Fees for fiscal 2013 were nil (2012: $0). The Audit Committee feels that the services rendered by Peterson Sullivan LLP
were compatible with maintaining the principal accountant's independence.
PART
IV
ITEM 15
– EXHIBIT, FINANCIAL STATEMENT SCHEDULES
Audited financial
statements of Aurora Gold Corporation have been included in Item 8 above and Exhibit A attached.
| 2. | Financial
Statement Schedules |
All schedules
for which provision is made in Regulation S-X are either not required to be included herein under the related instructions or
are inapplicable or the related information is included in the footnotes to the applicable financial statement and, therefore,
have been omitted from this Item 15.
All Exhibits
required to be filed with the Form 10-K are included in this annual report or incorporated by reference to the Companies previous
filings with the SEC which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 000-24393
98720970.
63 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Exhibit |
|
Description |
|
Status |
3.1.1 |
|
Certificate of Incorporation incorporated by
reference to the registration statement on Form 10SB |
|
Filed |
3.1 |
|
Certificate of Amendment to the Certificate
of Incorporation incorporated by reference to the registration statement on Form 10SB |
|
Filed |
3.1 |
|
Certificate of Restoration and Renewal of Certificate
of Incorporation incorporated by reference to the registration statement on Form 10SB |
|
Filed |
3.1.2 |
|
Certificate of Amendment to the Certificate
of Incorporation incorporated by reference to the registration statement on Form 10SB |
|
Filed |
3.1.3 |
|
Certificate of Restoration and Renewal of Certificate
of Incorporation incorporated by reference to the registration statement on Form 10SB |
|
Filed |
3.2.1 |
|
By-laws incorporated by reference to the registration
statement on Form 10SB |
|
Filed |
3.2.2 |
|
Amended and Restated By-laws incorporated by
reference to the registration statement on Form 10SB |
|
Filed |
4.1 |
|
Form of Subscription
Agreement incorporated by reference to the Post-Effective amendments for registration statement on Form S-1 |
|
Filed |
4.2 |
|
Form of Series A Warrant incorporated by reference
to the Post-Effective amendments for registration statement on Form S-1 filed |
|
Filed |
4.3 |
|
Debt Settlement Agreement with Samba Minerals
Limited incorporated by reference to the registration statement on Form S-1 filed |
|
Filed |
4.4 |
|
Form of Debt Settlement Agreement with Axino
AG, Heroe Investments Inc, Jolanda Investments Ltd, Gemeinhardt GmbH, Lars Pearl and WS Marketing GmbH. incorporated by reference
to the registration statement on Form S-1 |
|
Filed |
10.1 |
|
Consulting Agreement between Hans W. Biener
of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB |
|
Filed |
10.1 |
|
Services Agreement (the “LP Services
Agreement”) with Lars Pearl, the Company’s Chief Executive Officer, pursuant to which Mr Pearl will serve as the
Company’s Chief Executive Officer. |
|
Filed |
10.1 |
|
Services Agreement (the “AS Services
Agreement”) with Agustin Gomez de Segura, the Company’s Chairman and sole independent director, pursuant to which
Mr Segura will serve as the Company’s Chairman and independent director. |
|
Filed |
10.2 |
|
Confidentiality Agreement between Hans W. Biener
of SupplyConsult GbR and Aurora Gold Corporation incorporated by reference to the registration statement on Form SB |
|
Filed |
10.3 |
|
Assignment of Novo Porto and Santa Clara Memorandum
of Understanding to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB |
|
Filed |
10.4 |
|
Novo Porto Memorandum of Understanding Corporation
incorporated by reference to the registration statement on Form SB |
|
Filed |
10.5 |
|
Declaration of Translator for translation of
Porto Novo Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration
statement on Form SB |
|
Filed |
10.6 |
|
Novo Porto Option Agreement incorporated by
reference to the Form 10-KSB |
|
Filed |
10.7 |
|
Declaration of Translator for translation of
Novo Porto Option Agreement from Portuguese to English Corporation incorporated by reference to the Form 10-KSB |
|
Filed |
10.8 |
|
Santa Clara Memorandum of Understanding incorporated
by reference to the registration statement on Form SB filed |
|
Filed |
10.9 |
|
Declaration of Translator for translation of
Santa Clara Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration
statement on Form SB filed |
|
Filed |
10.10 |
|
Assignment of Ouro Mil Memorandum of Understanding
to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB |
|
Filed |
10.11 |
|
Ouro Mil Memorandum of Understanding Corporation
incorporated by reference to the registration statement on Form SB filed |
|
Filed |
64 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Exhibit |
|
Description |
|
Status |
10.12 |
|
Declaration of Translator for translation of
Ouro Mil Memorandum of Understanding from Portuguese to English Corporation incorporated by reference to the registration
statement on Form SB |
|
Filed |
10.13 |
|
Ouro Mil Option Agreement incorporated by reference
to the Form 10-KSB |
|
Filed |
10.14 |
|
Declaration of Translator for translation of
Ouro Mil Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB |
|
Filed |
10.15 |
|
Assignment of Sao Domingos Memorandum of Understanding
to Aurora Gold Corporation incorporated by reference to the registration statement on Form SB |
|
Filed |
10.16 |
|
Sao Domingos Memorandum of Understanding Corporation
incorporated by reference to the registration statement on Form SB |
|
Filed |
10.17 |
|
Declaration of Translator for translation of
Sao Domingos Memorandum of Understanding from Portuguese to English incorporated by reference to the registration statement
on Form SB |
|
Filed |
10.18 |
|
Săo Domingos Option Agreement incorporated
by reference to the Form 10-KSB |
|
Filed |
10.19 |
|
Declaration of Translator for translation of
Săo Domingos Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB |
|
Filed |
10.20 |
|
Santa Isabel Option Agreement incorporated
by reference to the Form 10-KSB |
|
Filed |
10.21 |
|
Declaration of Translator for translation of
Santa Isabel Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB |
|
Filed |
10.22 |
|
Săo Joăo Option Agreement incorporated
by reference to the Form 10-KSB |
|
Filed |
10.23 |
|
Declaration of Translator for translation of
Săo Joăo Option Agreement from Portuguese to English incorporated by reference to the Form 10-KSB |
|
Filed |
10.24 |
|
Piranhas Memorandum of Understanding incorporated
by reference to the Form 10-KSB |
|
Filed |
10.25 |
|
Declaration of Translator for translation of
Piranhas Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-KSB |
|
Filed |
10.26 |
|
Branca de Neve Memorandum of Understanding
incorporated by reference to the Form 10- QSB |
|
Filed |
10.27 |
|
Declaration of Translator
for translation of Branca de Neve Memorandum of Understanding from Portuguese to English incorporated by reference to the
Form 10-QSB |
|
Filed |
10.28 |
|
Bigode Memorandum of Understanding incorporated
by reference to the Form 10-QSB |
|
Filed |
10.29 |
|
Declaration of Translator for translation of
Bigode Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB filed |
|
Filed |
10.30 |
|
Santa Lucia Memorandum of Understanding incorporated
by reference to the Form 10-QSB |
|
Filed |
10.31 |
|
Declaration of Translator for translation of
Santa Lucia Memorandum of Understanding from Portuguese to English incorporated by reference to the Form 10-QSB |
|
Filed |
10.34 |
|
Settlement Agreement dated as of August 9,
2007 between the Company and Luis Mauricio incorporated by reference to the Form SB-2 |
|
Filed |
10.35 |
|
Form of Subscription Agreement between the
Selling Stockholders and the Company incorporated by reference to the Form SB-2 |
|
Filed |
10.36 |
|
Comandante Araras Memorandum of Understanding
incorporated by reference to the Form 10-KSB |
|
Filed |
10.37 |
|
2007 Stock Option Plan incorporated by reference
to the Form 10-KSB |
|
Filed |
10.38 |
|
Asset Purchase Agreement dated June 15, 2010
incorporated by reference to the registration statement on Form S-1/A |
|
Filed |
10.39 |
|
Asset Purchase Agreement dated June 14, 2011
incorporated by reference to the 8-K |
|
Filed |
31.1 |
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
Included |
31.2 |
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Included |
65 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
Exhibit |
|
Description |
|
Status |
32.1 |
|
Certification
of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
Included |
32.2 |
|
Certification of Chief Financial
Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
Included |
99.1 |
|
Corporate Governance Principles incorporated
by reference to the Form 10-KSB filed on March 25, 2004 (SEC File No. 000-24393- 04689262). |
|
Filed |
101* |
|
Financial statements from
the quarterly reports on Form 10-Q of Aurora Gold Corporation for the quarter ended May 31, 2013, 2012 and beyond are
formatted in XBRL: (i) the Balance Sheets, (ii) the Statements of Operations; (iii) the Statements of Cash Flows, and
(iv) the Statements of Stockholders’ Equity (Deficit).
* In accordance with Rule
406T of Regulation S-T, the XBRL (“eXtensible Business Reporting Language”) related information is furnished
and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act
of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject
to liability under these sections. |
|
Filed |
101.INS |
|
XBRL Instance Document |
|
Filed |
101.SCH |
|
XBRL Taxonomy Extension Schema |
|
Filed |
101.CAL |
|
XBRL Taxonomy Extension Calculation Linkbase |
|
Filed |
101.DEF |
|
XBRL Taxonomy Extension Definition Linkbase |
|
Filed |
101.LAB |
|
XBRL Taxonomy Extension Label Linkbase |
|
Filed |
101.PRE |
|
XBRL Taxonomy Extension Presentation Linkbase |
|
Filed |
* Filed Herewith
66 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
EXHIBIT
A
FINANCIAL
STATEMENTS
67 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Aurora Gold Corporation
We have audited the accompanying consolidated
balance sheets of Aurora Gold Corporation (an exploration stage company) and Subsidiary (“the Company”) as of December
31, 2013 and 2012, and the related consolidated statements of comprehensive income (loss), stockholders’ equity (deficiency),
and cash flows for the years then ended, and for the period from October 10, 1995 (date of inception) to December 31, 2013. These
consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those statements require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. The
Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of Aurora Gold Corporation (an exploration
stage company) and Subsidiary as of December 31, 2013 and 2012, and the results of their operations and their cash flows for the
years then ended, and for the period from October 10, 1995 (date of inception) to December 31, 2013, in conformity with accounting
principles generally accepted in the United States.
The accompanying consolidated financial
statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated
financial statements, the Company has incurred operating losses since inception, has not been able to generate any operating revenues
to date, and used cash during 2013 operations of $3,414,198. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 1. The consolidated
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/S/ PETERSON SULLIVAN LLP
Seattle, Washington
March 31, 2014
68 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
CONSOLIDATED
BALANCE SHEETS
AURORA GOLD CORPORATION | |
31 December | | |
31 December | |
Consolidated Balance Sheets | |
2013 | | |
2012 | |
(An exploration stage enterprise) | |
| | |
| |
(Expressed in U.S. Dollars) | |
$ | | |
$ | |
ASSETS | |
| | | |
| | |
Current assets | |
| | | |
| | |
Cash | |
| 55,161 | | |
| 3,963,836 | |
Prepayments | |
| 69,519 | | |
| 67,910 | |
Total current assets | |
| 124,680 | | |
| 4,031,746 | |
| |
| | | |
| | |
Non current assets | |
| | | |
| | |
Vehicles and other equipment, net | |
| 377,532 | | |
| 97,916 | |
Land Possession Rights | |
| 53,323 | | |
| - | |
Total non current assets | |
| 430,855 | | |
| 97,916 | |
Total assets | |
| 555,535 | | |
| 4,129,662 | |
| |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS’
EQUITY (DEFICIENCY) | |
| | | |
| | |
Current liabilities | |
| | | |
| | |
Accounts payable and accrued expenses | |
| 185,267 | | |
| 119,123 | |
Accounts payable and accrued expenses - related party | |
| 10,800 | | |
| 126,220 | |
Advances payable - related party | |
| 32,000 | | |
| 32,000 | |
Total current liabilities | |
| 228,067 | | |
| 277,343 | |
| |
| | | |
| | |
Stockholders’ Equity (Deficiency) | |
| | | |
| | |
Common stock with par value of $0.005 each Authorized:
300,000,000 (Dec 31, 2012: 300,000,000) Issued and outstanding: 49,828,942 (Dec 31, 2012: 49,828,942) | |
| 249,146 | | |
| 249,146 | |
Additional paid-in capital | |
| 27,211,349 | | |
| 27,211,349 | |
Accumulated other comprehensive income (loss) | |
| (126,564 | ) | |
| (7,202 | ) |
Accumulated deficit during the
exploration stage | |
| (27,006,463 | ) | |
| (23,600,974 | ) |
Total stockholders’ equity
(deficiency) | |
| 327,468 | | |
| 3,852,319 | |
Total liabilities and stockholders’
equity (deficiency) | |
| 555,535 | | |
| 4,129,662 | |
The accompanying
notes are an integral part of these consolidated financial statements.
69 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
AURORA GOLD CORPORATION | |
Cumulative | | |
| | |
| |
| |
October 10, 1995 | | |
For the | | |
For the | |
(An exploration stage enterprise) | |
(inception) | | |
Year Ended | | |
Year Ended | |
Consolidated Statements of Comprehensive Income (Loss) | |
to 31 December | | |
31 December | | |
31 December | |
(Expressed in U.S. Dollars) | |
2013 | | |
2013 | | |
2012 | |
| |
$ | | |
$ | | |
$ | |
Operating expenses | |
| | | |
| | | |
| | |
Independent directors fees | |
| | | |
| 43,338 | | |
| - | |
Professional fees - audit, legal, company secretary | |
| | | |
| 618,294 | | |
| 125,838 | |
Investor relations, listing and filing fees | |
| | | |
| 200,563 | | |
| - | |
Travel and accommodation | |
| | | |
| 178,852 | | |
| - | |
Salaries, management and consulting fees | |
| | | |
| 556,017 | | |
| 447,088 | |
Telecommunication costs | |
| | | |
| 4,548 | | |
| - | |
Other general and administrative | |
| | | |
| 88,322 | | |
| 380,439 | |
Total general and administration | |
| 10,259,421 | | |
| 1,689,934 | | |
| 953,365 | |
Depreciation and amortization | |
| 192,431 | | |
| 42,176 | | |
| 5,129 | |
Interest and bank charges | |
| 405,035 | | |
| 8,253 | | |
| 2,525 | |
Imputed interest on loan payable - related party | |
| 1,560 | | |
| - | | |
| - | |
Foreign exchange loss (gain) | |
| (25,386 | ) | |
| (11,630 | ) | |
| 1,563 | |
Exploration expenses | |
| 11,746,892 | | |
| 1,682,767 | | |
| 332,785 | |
Property search and negotiation | |
| 479,695 | | |
| - | | |
| - | |
Write-off of equipment | |
| 240,338 | | |
| - | | |
| - | |
| |
| 23,299,986 | | |
| 3,411,500 | | |
| 1,295,367 | |
Other income (expense) | |
| | | |
| | | |
| | |
Gain (loss) on disposition of subsidiary | |
| (2,541,037 | ) | |
| - | | |
| - | |
Interest income | |
| 28,497 | | |
| 6,011 | | |
| 133 | |
Gain on sale of rights to Matupa agreement, net | |
| 80,237 | | |
| - | | |
| - | |
Loss on investments | |
| (37,971 | ) | |
| - | | |
| 94,860 | |
Loss on spun-off operations | |
| (316,598 | ) | |
| - | | |
| - | |
Loss on extinguishment of liabilities | |
| (919,605 | ) | |
| - | | |
| - | |
| |
| (3,706,477 | ) | |
| 6,011 | | |
| 94,993 | |
Net Loss | |
| (27,006,463 | ) | |
| (3,405,489 | ) | |
| (1,200,374 | ) |
Other comprehensive income (loss) | |
| | | |
| - | | |
| - | |
Foreign currency translation adjustments | |
| | | |
| (119,362 | ) | |
| 63,323 | |
Comprehensive income (loss) | |
| | | |
| (3,524,851 | ) | |
| (1,137,051 | ) |
Net Loss Per Share – Basic and Diluted | |
| | | |
| (0.07 | ) | |
| (0.04 | ) |
Weighted Average Shares Outstanding – Basic and Diluted | |
| | | |
| 49,828,942 | | |
| 29,052,382 | |
The accompanying notes are an integral
part of these consolidated financial statements.
70 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
CONSOLIDATED STATEMENTS OF CASH
FLOWS
AURORA GOLD CORPORATION | |
Cumulative | | |
| | |
| |
| |
October 10, 1995 | | |
For the | | |
For the | |
(An exploration stage enterprise) | |
(inception) | | |
Year Ended | | |
Year Ended | |
Consolidated Statements of Cash Flows | |
to 31 December | | |
31 December | | |
31 December | |
(Expressed in U.S. Dollars) | |
2013 | | |
2013 | | |
2012 | |
| |
$ | | |
$ | | |
$ | |
Cash Flows From Operating Activities | |
| | | |
| | | |
| | |
Net loss for the period | |
| (27,006,463 | ) | |
| (3,405,489 | ) | |
| (1,200,374 | ) |
Adjustments to reconcile net loss to cash used in operating activities | |
| | | |
| - | | |
| | |
Depreciation and amortization | |
| 192,428 | | |
| 42,176 | | |
| 5,129 | |
Stock compensation expense on stock option grants | |
| 1,624,012 | | |
| - | | |
| 55,660 | |
Expenses satisfied with issuance of common stock | |
| 1,202,054 | | |
| - | | |
| - | |
Expenses satisfied with transfer of marketable securities | |
| 33,903 | | |
| - | | |
| - | |
Imputed interest on loan payable - related parties | |
| 1,560 | | |
| - | | |
| - | |
Write-off of equipment | |
| 240,338 | | |
| - | | |
| - | |
Adjustment for spin-off of Aurora Metals (BVI) Limited | |
| 316,498 | | |
| - | | |
| - | |
Loss on disposal of subsidiary | |
| 2,757,511 | | |
| - | | |
| - | |
Realized loss on investments | |
| 37,971 | | |
| - | | |
| - | |
Gain on sale of rights to Matupa agreement (net) | |
| (80,237 | ) | |
| - | | |
| - | |
(Gain) loss on extinguishment of liabilities | |
| 919,605 | | |
| - | | |
| (94,860 | ) |
Foreign exchange (gain) loss related to notes payable | |
| (24,534 | ) | |
| - | | |
| - | |
Change in operating assets and liabilities | |
| | | |
| | | |
| | |
Decrease (increase) in receivables and other assets | |
| (206,978 | ) | |
| - | | |
| - | |
(Increase) decrease in prepaid expenses and other assets | |
| (89,977 | ) | |
| (1,609 | ) | |
| (67,910 | ) |
Increase (decrease) in accounts payable and accrued expenses | |
| | | |
| | | |
| | |
(including related party) | |
| 1,063,787 | | |
| (49,276 | ) | |
| 6,013 | |
Net Cash Used in Operating Activities | |
| (19,018,522 | ) | |
| (3,414,198 | ) | |
| (1,296,342 | ) |
Cash Flows From Investing Activities | |
| | | |
| | | |
| | |
Purchase of equipment and land possession rights | |
| (683,505 | ) | |
| (375,115 | ) | |
| (103,045 | ) |
Proceeds on disposal of equipment | |
| 16,761 | | |
| - | | |
| - | |
Payment for mineral property Reclamation Bonds | |
| (245,221 | ) | |
| - | | |
| - | |
Proceeds from disposition of marketable securities | |
| 32,850 | | |
| - | | |
| - | |
Acquisition of mineral property costs and related equipment | |
| (672,981 | ) | |
| - | | |
| - | |
Payment for incorporation cost | |
| (11,511 | ) | |
| - | | |
| - | |
Net CashProvided by (used in) Investing Activities | |
| (1,563,607 | ) | |
| (375,115 | ) | |
| (103,045 | ) |
Cash Flows From Financing Activities | |
| | | |
| | | |
| | |
Proceeds from common stock less issuance costs | |
| 19,140,912 | | |
| - | | |
| 5,096,473 | |
Loan proceeds from related party | |
| 289,000 | | |
| - | | |
| - | |
Net proceeds from (payments on) convertible notes and loans | |
| 969,252 | | |
| - | | |
| - | |
Net proceeds from (payments on) advances payable | |
| 45,000 | | |
| - | | |
| - | |
Net proceeds from (payments on) advances payable -related
parties | |
| 92,000 | | |
| - | | |
| - | |
Net Cash Provided by Financing Activities | |
| 20,536,164 | | |
| - | | |
| 5,096,473 | |
Effect of exchange rate changes on Cash and Cash Equivalents | |
| 101,126 | | |
| (119,362 | ) | |
| 29,324 | |
(Decrease) Increase in Cash | |
| 55,161 | | |
| (3,908,675 | ) | |
| 3,726,410 | |
Cash at Beginning of Period | |
| | | |
| 3,963,836 | | |
| 237,426 | |
Cash at End of Period | |
| 55,161 | | |
| 55,161 | | |
| 3,963,836 | |
The accompanying notes are an integral
part of these consolidated financial statements.
71 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIENCY)
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance, October 10, 1995 | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | |
Issuance of common stock for - settlement
of indebtedness | |
| 2,292,231 | | |
| 11,461 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 11,461 | |
Net (loss) for the period | |
| - | | |
| | | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | |
Balance December 31, 1995 | |
| 2,292,231 | | |
| 11,461 | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 11,461 | |
Adjustment for reverse stock split | |
| (1,528,153 | ) | |
| (7,641 | ) | |
| - | | |
| - | | |
| - | | |
| - | | |
| (7,641 | ) |
Issuance of common stock for - cash at $0.005
per share | |
| 1,160,000 | | |
| 5,800 | | |
| 341,761 | | |
| - | | |
| - | | |
| - | | |
| 347,561 | |
- resource property | |
| 60,000 | | |
| 300 | | |
| 2,700 | | |
| - | | |
| - | | |
| - | | |
| 3,000 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| | | |
| (361,208 | ) | |
| - | | |
| (361,208 | ) |
Balance December 31, 1996 | |
| 1,984,077 | | |
| 9,920 | | |
| 344,461 | | |
| | | |
| (361,208 | ) | |
| - | | |
| (6,827 | ) |
Issuance of common stock for - cash in March
1997 (less issue costs of $4,842) | |
| 150,000 | | |
| 750 | | |
| 744,408 | | |
| - | | |
| - | | |
| - | | |
| 745,158 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (615,880 | ) | |
| - | | |
| (615,880 | ) |
Balance December 31, 1997 | |
| 2,134,077 | | |
| 10,670 | | |
| 1,088,869 | | |
| - | | |
| (977,088 | ) | |
| - | | |
| 122,451 | |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- settlement of indebtedness | |
| 19,221 | | |
| 96 | | |
| 68,601 | | |
| - | | |
| - | | |
| - | | |
| 68,697 | |
- cash in May 1998 | |
| 40,000 | | |
| 200 | | |
| 249,800 | | |
| - | | |
| - | | |
| - | | |
| 250,000 | |
- cash in November 1998 | |
| 14,333 | | |
| 72 | | |
| 53,678 | | |
| - | | |
| - | | |
| - | | |
| 53,750 | |
- cash in December 1998 | |
| 28,667 | | |
| 143 | | |
| 107,357 | | |
| - | | |
| - | | |
| - | | |
| 107,500 | |
Grant of options to employees and directors | |
| - | | |
| | | |
| 518,900 | | |
| - | | |
| - | | |
| - | | |
| 518,900 | |
Grant of options to consultants | |
| - | | |
| | | |
| 172,100 | | |
| - | | |
| - | | |
| - | | |
| 172,100 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (1,151,604 | ) | |
| - | | |
| (1,151,604 | ) |
Balance December 31, 1998 | |
| 2,236,298 | | |
| 11,181 | | |
| 2,259,304 | | |
| - | | |
| (2,128,692 | ) | |
| - | | |
| 141,794 | |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- settlement of indebtedness | |
| 46,257 | | |
| 231 | | |
| 160,151 | | |
| - | | |
| - | | |
| - | | |
| 160,382 | |
- cash in March 1999 | |
| 4,574 | | |
| 23 | | |
| 14,977 | | |
| - | | |
| - | | |
| - | | |
| 15,000 | |
- finder's fee in February 1999 | |
| 5,000 | | |
| 25 | | |
| 20,287 | | |
| - | | |
| - | | |
| - | | |
| 20,312 | |
Grant of options to consultants | |
| - | | |
| | | |
| 29,500 | | |
| - | | |
| - | | |
| - | | |
| 29,500 | |
Cash advanced on stock subscriptions | |
| - | | |
| | | |
| | | |
| 425,000 | | |
| - | | |
| | | |
| 425,000 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (855,391 | ) | |
| - | | |
| (855,391 | ) |
Balance December 31, 1999 | |
| 2,292,130 | | |
| 11,461 | | |
| 2,484,219 | | |
| 425,000 | | |
| (2,984,083 | ) | |
| - | | |
| (63,403 | ) |
The accompanying
notes are an integral part of these consolidated financial statements.
72 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
Balance December 31, 1999 | |
| 2,292,130 | | |
| 11,461 | | |
| 2,484,219 | | |
| 425,000 | | |
| (2,984,083 | ) | |
| - | | |
| (63,403 | ) |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- settlement of indebtedness | |
| 39,800 | | |
| 199 | | |
| 99,301 | | |
| - | | |
| - | | |
| - | | |
| 99,500 | |
- cash in March 2000 | |
| 70,000 | | |
| 350 | | |
| 174,650 | | |
| (175,000 | ) | |
| - | | |
| - | | |
| - | |
- cash in March 2000 | |
| 110,000 | | |
| 550 | | |
| 249,450 | | |
| (250,000 | ) | |
| - | | |
| - | | |
| - | |
Cancellation of shares in April 2000 | |
| (18,141 | ) | |
| (91 | ) | |
| (56,600 | ) | |
| - | | |
| - | | |
| - | | |
| (56,691 | ) |
Exercise of options in June 2000 | |
| 81,000 | | |
| 405 | | |
| 3,645 | | |
| - | | |
| - | | |
| - | | |
| 4,050 | |
Spin-off of Aurora Metals (BVI) Limited | |
| - | | |
| | | |
| 316,498 | | |
| - | | |
| - | | |
| - | | |
| 316,498 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (677,705 | ) | |
| - | | |
| (677,705 | ) |
Balance December 31, 2000 | |
| 2,574,789 | | |
| 12,874 | | |
| 3,271,163 | | |
| - | | |
| (3,661,788 | ) | |
| - | | |
| (377,751 | ) |
Components of comprehensive income (loss): | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net income for the period | |
| - | | |
| | | |
| | | |
| - | | |
| 128,545 | | |
| - | | |
| 128,545 | |
- Unrealized holding losses
on available-for-sale securities | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (141,928 | ) | |
| (141,928 | ) |
Balance December 31, 2001 | |
| 2,574,789 | | |
| 12,874 | | |
| 3,271,163 | | |
| - | | |
| (3,533,243 | ) | |
| (141,928 | ) | |
| (391,134 | ) |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- settlement of indebtedness | |
| 741,608 | | |
| 3,708 | | |
| 351,492 | | |
| - | | |
| - | | |
| - | | |
| 355,200 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| - | | |
| - | |
- Net loss for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (137,329 | ) | |
| - | | |
| (137,329 | ) |
- Unrealized holding gain
on available-for-sale securities | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| 141,928 | | |
| 141,928 | |
Balance, December 31, 2002 | |
| 3,316,396 | | |
| 16,582 | | |
| 3,622,655 | | |
| - | | |
| (3,670,572 | ) | |
| - | | |
| (31,335 | ) |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- settlement of indebtedness | |
| 550,490 | | |
| 2,752 | | |
| 114,806 | | |
| - | | |
| - | | |
| - | | |
| 117,558 | |
- cash in December 2003 | |
| 20,000 | | |
| 100 | | |
| 24,900 | | |
| - | | |
| - | | |
| - | | |
| 25,000 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net loss for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (96,404 | ) | |
| - | | |
| (96,404 | ) |
Balance, December 31, 2003 | |
| 3,886,886 | | |
| 19,434 | | |
| 3,762,361 | | |
| - | | |
| (3,766,976 | ) | |
| - | | |
| 14,819 | |
The accompanying
notes are an integral part of these consolidated financial statements.
73 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
Balance, December 31, 2003 | |
| 3,886,886 | | |
| 19,434 | | |
| 3,762,361 | | |
| - | | |
| (3,766,976 | ) | |
| - | | |
| 14,819 | |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- cash in January 2004, less issuance costs | |
| 20,000 | | |
| 100 | | |
| 22,400 | | |
| - | | |
| - | | |
| - | | |
| 22,500 | |
Imputed interest | |
| - | | |
| | | |
| 1,560 | | |
| - | | |
| - | | |
| - | | |
| 1,560 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net loss for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (223,763 | ) | |
| - | | |
| (223,763 | ) |
| |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance, December 31, 2004 | |
| 3,906,886 | | |
| 19,534 | | |
| 3,786,321 | | |
| - | | |
| (3,990,739 | ) | |
| - | | |
| (184,884 | ) |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- cash in July 2005 | |
| 2,600,000 | | |
| 13,000 | | |
| 637,000 | | |
| - | | |
| - | | |
| - | | |
| 650,000 | |
- settlement of indebtedness | |
| 736,818 | | |
| 3,684 | | |
| 158,816 | | |
| - | | |
| - | | |
| - | | |
| 162,500 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (457,271 | ) | |
| - | | |
| (457,271 | ) |
- Unrealized holding losses on available-for-sale securities | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (4,614 | ) | |
| (4,614 | ) |
Balance, December 31, 2005 | |
| 7,243,704 | | |
| 36,218 | | |
| 4,582,137 | | |
| - | | |
| (4,448,010 | ) | |
| (4,614 | ) | |
| 165,731 | |
Issuance of common stock for - cash in February 2006 (less | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
issurance costs of $110,000) | |
| 1,600,000 | | |
| 8,000 | | |
| 3,882,000 | | |
| - | | |
| - | | |
| - | | |
| 3,890,000 | |
- non cash finder's fee in December 2006 | |
| 50,000 | | |
| 250 | | |
| 174,750 | | |
| - | | |
| - | | |
| - | | |
| 175,000 | |
- cash in December 2006 | |
| 200,000 | | |
| 1,000 | | |
| 499,000 | | |
| - | | |
| - | | |
| - | | |
| 500,000 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (5,463,855 | ) | |
| - | | |
| (5,463,855 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (3,692 | ) | |
| (3,692 | ) |
- Reclassification adjustment for losses on available-for-sale | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
securities included in net loss | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| 4,614 | | |
| 4,614 | |
Balance, December 31, 2006 | |
| 9,093,704 | | |
| 45,468 | | |
| 9,137,887 | | |
| - | | |
| (9,911,865 | ) | |
| (3,692 | ) | |
| (732,202 | ) |
The accompanying
notes are an integral part of these consolidated financial statements.
74 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
Balance, December 31, 2006 | |
| 9,093,704 | | |
| 45,468 | | |
| 9,137,887 | | |
| - | | |
| (9,911,865 | ) | |
| (3,692 | ) | |
| (732,202 | ) |
Issuance of common stock for: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- cash in March 2007 | |
| 100,000 | | |
| 500 | | |
| 249,500 | | |
| - | | |
| - | | |
| - | | |
| 250,000 | |
- cash in July 2007 | |
| 1,000,000 | | |
| 5,000 | | |
| 1,245,000 | | |
| - | | |
| - | | |
| - | | |
| 1,250,000 | |
- settlement of indebtedness in August 2007 | |
| 50,000 | | |
| 250 | | |
| 49,750 | | |
| - | | |
| - | | |
| - | | |
| 50,000 | |
- cash in September 2007 | |
| 800,000 | | |
| 4,000 | | |
| 796,000 | | |
| - | | |
| - | | |
| - | | |
| 800,000 | |
Stock option compensation expense | |
| - | | |
| | | |
| 454,295 | | |
| - | | |
| - | | |
| - | | |
| 454,295 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (3,259,732 | ) | |
| - | | |
| (3,259,732 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (65,255 | ) | |
| (65,255 | ) |
Balance, December 31, 2007 | |
| 11,043,704 | | |
| 55,218 | | |
| 11,932,432 | | |
| - | | |
| (13,171,597 | ) | |
| (68,947 | ) | |
| (1,252,894 | ) |
Issuance of common stock for - non cash finder's fee in July 2008 | |
| 50,000 | | |
| 250 | | |
| 24,750 | | |
| - | | |
| - | | |
| - | | |
| 25,000 | |
- settlement of indebtedness in December 2008 | |
| 520,667 | | |
| 2,603 | | |
| 153,597 | | |
| - | | |
| - | | |
| - | | |
| 156,200 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (520,105 | ) | |
| - | | |
| (520,105 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| 36,259 | | |
| 36,259 | |
Balance, December 31, 2008 | |
| 11,614,371 | | |
| 58,071 | | |
| 12,110,779 | | |
| - | | |
| (13,691,702 | ) | |
| (32,688 | ) | |
| (1,555,540 | ) |
Issuance of common stock for - settlement of indebtedness in September 2009 | |
| 1,000,000 | | |
| 5,000 | | |
| 1,748,616 | | |
| - | | |
| - | | |
| - | | |
| 1,753,616 | |
- cash in September 2009 less finder's fee | |
| 600,000 | | |
| 3,000 | | |
| 255,000 | | |
| - | | |
| - | | |
| - | | |
| 258,000 | |
- non cash finder's fee September 2009 | |
| 84,000 | | |
| 420 | | |
| 41,580 | | |
| - | | |
| - | | |
| - | | |
| 42,000 | |
- settlement of indebtedness in November 2009 | |
| 20,000 | | |
| 100 | | |
| 17,899 | | |
| - | | |
| - | | |
| - | | |
| 17,999 | |
- settlement of indebtedness in November 2009 | |
| 30,000 | | |
| 150 | | |
| 35,611 | | |
| - | | |
| - | | |
| - | | |
| 35,761 | |
- cash in December 2009 | |
| 333,333 | | |
| 1,667 | | |
| 498,333 | | |
| - | | |
| - | | |
| - | | |
| 500,000 | |
Components of comprehensive income (loss): | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (1,779,477 | ) | |
| - | | |
| (1,779,477 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (60,171 | ) | |
| (60,171 | ) |
Balance, December 31, 2009 | |
| 13,681,704 | | |
| 68,408 | | |
| 14,707,818 | | |
| - | | |
| (15,471,179 | ) | |
| (92,859 | ) | |
| (787,812 | ) |
The accompanying
notes are an integral part of these consolidated financial statements.
75 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
Balance, December 31, 2009 | |
| 13,681,704 | | |
| 68,408 | | |
| 14,707,818 | | |
| - | | |
| (15,471,179 | ) | |
| (92,859 | ) | |
| (787,812 | ) |
Issuance of common stock for cash in April 2010 less finder's fee
(paid with 225,222 shares included herein): | |
| 2,821,889 | | |
| 14,110 | | |
| 3,880,890 | | |
| - | | |
| - | | |
| - | | |
| 3,895,000 | |
- non cash property acquisition in June 2010 | |
| 1,000,000 | | |
| 5,000 | | |
| 1,995,000 | | |
| - | | |
| - | | |
| - | | |
| 2,000,000 | |
- settlement of indebtedness in September 2010 | |
| 32,100 | | |
| 161 | | |
| 47,989 | | |
| - | | |
| - | | |
| - | | |
| 48,150 | |
- settlement of indebtedness in September 2010 | |
| 65,080 | | |
| 325 | | |
| 97,295 | | |
| - | | |
| - | | |
| - | | |
| 97,620 | |
- payment of expenses in September 2010 | |
| 40,000 | | |
| 200 | | |
| 59,800 | | |
| - | | |
| - | | |
| - | | |
| 60,000 | |
- non cash finder's fee in September 2010 related to the June 2010 property
acquisition | |
| 100,000 | | |
| 500 | | |
| 149,500 | | |
| - | | |
| - | | |
| - | | |
| 150,000 | |
Components of comprehensive income (loss) | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (2,302,083 | ) | |
| - | | |
| (2,302,083 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| (198 | ) | |
| (198 | ) |
Balance, December 31, 2010 | |
| 17,740,774 | | |
| 88,704 | | |
| 20,938,292 | | |
| - | | |
| (17,773,262 | ) | |
| (93,057 | ) | |
| 3,160,677 | |
Issuance of common stock for non cash finder's fee in May 2011 | |
| 90,000 | | |
| 450 | | |
| 49 | | |
| - | | |
| - | | |
| - | | |
| 499 | |
Issuance of common stock for cash in September 2011 | |
| 334,200 | | |
| 1,671 | | |
| 165,429 | | |
| - | | |
| - | | |
| - | | |
| 167,100 | |
Issuance of common stock for settlement of indebtedness in September 2011 | |
| 30,000 | | |
| 150 | | |
| 23,850 | | |
| - | | |
| - | | |
| - | | |
| 24,000 | |
Issuance of common stock for settlement of indebtedness in December 2011 | |
| 2,187,544 | | |
| 10,938 | | |
| 207,817 | | |
| | | |
| | | |
| | | |
| 218,755 | |
Issuance of common stock for cash in December 2011 | |
| 1,600,000 | | |
| 8,000 | | |
| 312,000 | | |
| | | |
| | | |
| | | |
| 320,000 | |
Issuance of common stock for cash in December 2011 - oversubscribed | |
| - | | |
| | | |
| | | |
| 20,000 | | |
| | | |
| | | |
| 20,000 | |
Stock option compensation expense | |
| - | | |
| | | |
| 393,557 | | |
| | | |
| | | |
| | | |
| 393,557 | |
Components of comprehensive income (loss) | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
- Net (loss) for the period | |
| - | | |
| | | |
| | | |
| - | | |
| (4,627,338 | ) | |
| - | | |
| (4,627,338 | ) |
- Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| - | | |
| - | | |
| 22,532 | | |
| 22,532 | |
Balance, December 31, 2011 | |
| 21,982,518 | | |
| 109,913 | | |
| 22,040,994 | | |
| 20,000 | | |
| (22,400,600 | ) | |
| (70,525 | ) | |
| (300,218 | ) |
The accompanying
notes are an integral part of these consolidated financial statements.
76 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
AURORA GOLD CORPORATION | |
| | |
| | |
| | |
| | |
| | |
Accumulated | | |
| |
(An exploration stage enterprise) | |
| | |
| | |
| | |
| | |
Accumulated | | |
Other | | |
Total | |
| |
| | |
| | |
Additional | | |
Advances for | | |
(deficit) during | | |
Comprehensive | | |
Stockholders' | |
Consolidated Statements of Stockholders' Equity (Deficiency) | |
Common Stock | | |
| | |
paid-in | | |
Stock | | |
Exploration | | |
Income | | |
Equity | |
October 10, 1995 (inception) to Balance Sheet Date | |
Shares | | |
Amount | | |
capital | | |
Subscriptions | | |
Stage | | |
(Loss) | | |
(Deficiency) | |
(Expressed in U.S. Dollars) | |
# | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | | |
$ | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance, December 31, 2011 | |
| 21,982,518 | | |
| 109,913 | | |
| 22,040,994 | | |
| 20,000 | | |
| (22,400,600 | ) | |
| (70,525 | ) | |
| (300,218 | ) |
Issuance of common stock for settlement of indebtedness in March 2012 | |
| 398,180 | | |
| 1,991 | | |
| 117,463 | | |
| | | |
| | | |
| | | |
| 119,454 | |
Issuance of common stock for cash in March 2012 - shares not issued until
April 2012 | |
| - | | |
| | | |
| | | |
| 17,513 | | |
| | | |
| | | |
| 17,513 | |
Issuance of common stock for cash in April 2012 | |
| 263,200 | | |
| 1,316 | | |
| 77,644 | | |
| | | |
| | | |
| | | |
| 78,960 | |
Issuance of common stock for settlement of indebtedness in April 2012 | |
| 60,000 | | |
| 300 | | |
| 17,700 | | |
| | | |
| | | |
| | | |
| 18,000 | |
Issuance of common stock in April 2012 for Advances for Stock Subscriptions | |
| 125,044 | | |
| 625 | | |
| 36,888 | | |
| (37,513 | ) | |
| | | |
| | | |
| - | |
Stock option compensation expense | |
| - | | |
| | | |
| 55,660 | | |
| | | |
| | | |
| | | |
| 55,660 | |
Issuance of common stock for cash on October 5, 2012 | |
| 27,000,000 | | |
| 135,000 | | |
| 4,865,000 | | |
| | | |
| | | |
| | | |
| 5,000,000 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| | | |
| (1,200,374 | ) | |
| | | |
| (1,200,374 | ) |
Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| 63,323 | | |
| 63,323 | |
Balance, December 31, 2012 | |
| 49,828,942 | | |
| 249,146 | | |
| 27,211,349 | | |
| - | | |
| (23,600,974 | ) | |
| (7,202 | ) | |
| 3,852,319 | |
Net (loss) for the period | |
| - | | |
| | | |
| | | |
| | | |
| (3,405,489 | ) | |
| | | |
| (3,405,489 | ) |
Foreign currency translation adjustments | |
| - | | |
| | | |
| | | |
| | | |
| | | |
| (119,362 | ) | |
| (119,362 | ) |
Balance, December 31, 2013 | |
| 49,828,942 | | |
| 249,146 | | |
| 27,211,349 | | |
| - | | |
| (27,006,463 | ) | |
| (126,564 | ) | |
| 327,468 | |
The accompanying
notes are an integral part of these consolidated financial statements.
77 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
| 1. | Organization,
Business Strategy and Going Concern |
Organisation
Aurora Gold
Corporation ("the Company") was formed on October 10, 1995 under the laws of the State of Delaware and is in the business
of location, acquisition, exploration and, if warranted, development of mineral properties. The Company’s focus is on the
exploration and development of its exploration properties located in the Tapajos Gold Province, State of Pará, Brazil (refer
to Note 3). The Company has not yet determined whether its properties contain mineral reserves that may be economically recoverable
and has not generated any operating revenues to date.
The Company
is a junior mineral exploration company and conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse
20, 6304 Zug, Switzerland. The telephone number is (+41) 41 711 0281. These offices are provided to the Company on a month-to-month
basis. The Company believes these offices are adequate for the business requirements during the next 12 months. The Company does
not own any real property.
Business
Strategy
The general
business strategy is to acquire mineral properties either directly or through the acquisition of operating entities. The continued
operations and the recoverability of minerals are dependent upon the existence of economically recoverable mineral reserves, confirmation
of interest in the underlying properties and ability to obtain necessary financing to complete the development and future profitable
production. Since 1996 the Company acquired and disposed of a number of properties. The Company has not been successful in any
exploration efforts to establish reserves on any of the properties owned by or in which the Company holds an interest.
The Company
currently has an interest in a strategic land package of six (6) properties none of which contain any proven reserves.
Going Concern
The Company
has no revenues, and has sustained losses since inception. The Company will not generate revenues even if any of its exploration
programs indicate that a mineral deposit may exist on the properties. Accordingly, the Company will be dependent on future financings
in order to maintain operations and continue exploration activities.
These consolidated
financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern,
which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.
The general business strategy of the Company is to acquire mineral properties either directly or through the acquisition of operating
entities.
The Company
has incurred recurring operating losses since inception, has not generated any operating revenues to date and during the year
ended December 31, 2013, operating activities used cash of $3,414,198 (December 31, 2012: $1,296,342). The Company requires additional
funds to meet its obligations and maintain its operations.
These conditions
raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in this regard are to raise
equity financing through private or public equity investment in order to support existing operations and expand its business.
There is however no assurance that such additional funding will be available to the Company when required, or on terms acceptable
to the Company. In the event that the Company cannot obtain additional funds, on a timely basis, or the operations do not generate
sufficient cash flow, the Company may be forced to curtail development or cease activities. These consolidated financial statements
do not include any adjustments that might result from this uncertainty.
78 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| 2. | Summary
of Significant Accounting Policies |
The
Company follows accounting standards set by the Financial Accounting Standards Board (FASB). The FASB sets accounting principles
generally accepted (GAAP) in the United States that the Company follows to ensure they consistently report their financial condition,
results of operations, and cash flows. References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards
Codification (ASC) or also referred to as Codification.
These
consolidated financial statements have been prepared in accordance with GAAP and include the accounts of the Company and its wholly
owned subsidiaries, Aurora Gold Mineração Ltda ("Aurora Gold Mineração") and AGC Resources
LLC (“AGC”) (through to date of disposition of AGC, June 14, 2011). Collectively, they are referred to herein as "the
Company". Significant inter-company accounts and transactions have been eliminated.
The
preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those
estimates and assumptions.
Cash
equivalents comprise certain highly liquid instruments with a maturity date of three months or less when purchased. The Company
has cash and cash equivalents of $55,161 as at December 31, 2013 ($3,963,836 as at December 31, 2012). Amounts paid for income
taxes during the years ended December 31, 2013 and 2012 were nil; and for interest paid nil respectively.
79 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| 2. | Summary
of Significant Accounting Policies (Continued) |
| (d) | Vehicles,
Equipment and Land Possession Rights |
Vehicles and
equipment are carried at cost (including development and preproduction costs, capitalized interest, other financing costs and
all direct administrative support costs incurred during the construction period, net of cost recoveries and incidental revenues),
less accumulated depletion and depreciation including write-downs. Following the construction period, interest, other financing
costs and administrative costs are expensed as incurred. Buildings and equipment utilized directly in commercial mining activities
are depreciated, following the commencement of commercial production, over their expected economic lives using either the unit-of-production
method or the straight-line method. Depreciation is provided over the following useful lives:
- |
Vehicles
|
5 years |
- |
Office equipment,
furniture and fixtures |
2 to 10 years |
- |
Mining equipment |
10 years |
The Company
reviews the carrying values of its vehicles and equipment whenever events or changes in circumstances indicate that their carrying
values may not be recoverable. Impairment is considered to exist if total estimated future cash flows, or probability-weighted
cash flows on an undiscounted basis, are less than the carrying value of the assets. An impairment loss is measured and recorded
based on discounted estimated future cash flows associated with values beyond proven and probable reserves and resources. In estimating
future cash flows, assets are grouped at the lowest level for which there is identifiable future cash flows that are largely independent
of cash flows from other asset groups. Generally, in estimating future cash flows, all assets are grouped at a particular property
for which there are identifiable cash flows.
All vehicles
and equipment are located in Brazil.
Land possession
rights consist of amounts paid for possession rights to land in Brazil. Such costs are capitalized as the payments provide
us with certain ownership rights for a period of time.
| (e) | Mineral
Property Reclamation Bonds and Other Related Refundable Costs |
Costs paid
for the purchase of reclamation bonds and other related costs that are refundable are capitalized. If amounts paid are not
to be refunded then they will be expensed when it is determined they will not be refunded.
| (f) | Mineral
Properties and Exploration Expenses |
The Company
accounts for its mineral properties on a cost basis whereby all direct costs, net of pre-production revenue, relative to the acquisition
of the properties are capitalized. All sales and option proceeds received are first credited against the costs of the related
property, with any excess credited to earnings. Once commercial production has commenced, the net costs of the applicable property
will be charged to operations using the unit-of-production method based on estimated proven and probable recoverable reserves.
The net costs related to abandoned properties are charged to operations.
Exploration
costs are charged to operations as incurred until such time that proven reserves are discovered. From that time forward, the Company
will capitalize all costs to the extent that future cash flow from mineral reserves equals or exceeds the costs deferred. The
deferred costs will be amortized over the recoverable reserves when a property reaches commercial production. As at the reporting
period ended, the Company does not have proven reserves. Exploration activities conducted jointly with others are reflected at
the Company's proportionate interest in such activities.
80 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
2.
Summary of Significant Accounting Policies (Continued)
The Company
reviews the carrying values of its mineral properties on a regular basis by reference to the project economics including the timing
of the exploration or development work, the program of works and the exploration results experienced by the Company and others.
The review of the carrying value of any producing property will be made by reference to the estimated future operating results
and net cash flows. When the carrying value of a property exceeds its estimated net recoverable amount, provision is made for
the decline in value.
The recoverability
of the amounts recorded for mineral properties is dependent on the confirmation of economically recoverable reserves, confirmation
of the Company’s interest in the underlying mineral claims, the ability of the Company to obtain the necessary financing
to successfully complete their development and the attainment of future profitable operations or proceeds from disposal.
Estimated costs
related to site restoration programs during the commercial development stage of the property are accrued over the life of the
project.
| (g) | Stock-Based
Compensation |
The Company
accounts for share-based payments under the fair value method of accounting for stock-based compensation consistent with GAAP.
Under the fair value method, stock-based compensation cost is measured at the grant date based on the fair value of the award
using the Black-Scholes option pricing model and is recognized to expense on a straight-line basis over the requisite service
period, which is generally the vesting period. Where upon grant the options vest immediately the stock-based costs are expensed
immediately.
Interest expense
for the periods ended December 31, 2013 and 2012 were nil.
| (i) | Foreign
Currency Translation and Transactions |
The Company's
reporting currency is the United States Dollar (USD). Aurora Gold Mineração Ltda is a foreign operation and its
functional currency is the Brazilian Real (Real). Certain contractual obligations in these consolidated financial statements are
stated in Brazilian Real’s. At the years ended December 31, 2013 and 2012 the Brazilian Real exchange rate to the USD was
$0.42320 to 1 Real (December 31, 2012: USD $0.48800 to 1 Real).
The Company
translates foreign assets and liabilities of its subsidiaries, other than those denominated in USD, at the rate of exchange at
the balance sheet date. Income and expenses of these subsidiaries are translated at the average rate of exchange throughout the
reporting period. Gains or losses from these translations are reported as a separate component of other comprehensive income (loss)
until all or a part of the investment in the subsidiaries is sold or liquidated. The translation adjustments do not recognize
the effect of income tax because the Company expects to reinvest the amounts indefinitely in operations. Accumulated other comprehensive
income (loss) consists entirely of foreign currency translation adjustments at December 31, 2013 and 2012.
Transaction
gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the local functional
currency are included in foreign exchange (gain) loss in the consolidated statements of comprehensive income (loss).
| (j) | Concentration
of Credit Risk |
Financial instruments
that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company places
its cash with high credit quality financial institutions in Brazil and Canada. The Company occasionally has cash deposits in excess
of federally insured limits. The Company had funds deposited in banks beyond the insured limits as of December 31, 2013
and 2012 respectively. The Company has not experienced any losses related to these balances, and management believes the credit
risk to be minimal.
81 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
2.
Summary of Significant Accounting Policies (Continued)
| (k) | Fair
Value of Financial Instruments and Risks |
Fair value
estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets
and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant
judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value.
Management
is of the opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.
The Company operates outside of the United States of America (primarily in Brazil) and is exposed to foreign currency risk due
to the fluctuation between the currency in which the Company operates in and the USD.
The Company
has adopted ASC 740, Accounting for Income Taxes, which requires the Company to recognize deferred tax liabilities and
assets for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax
returns using the liability method. Under this method, deferred tax liabilities and assets are determined based on the differences
between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect in
the years in which the differences are expected to reverse. In July 2006, the FASB issued an interpretation, which clarifies the
accounting for uncertainty in income taxes recognized in a company’s financial statements in accordance with GAAP. This
interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement
of a tax position taken in a tax return. It also provides guidance on derecognition, classification, interest and penalties, accounting
in interim periods, disclosure and transition. Estimated interest and penalties related to recording uncertain tax positions when
recorded are included as a component of income tax expense on the consolidated statement of operations. The Company has not recorded
any liabilities for uncertain tax positions or any related interest and penalties. The Company’s tax returns are open to
audit for the years ending December 31, 2010 to 2013.
| (m) | Basic
and Diluted Net Income (Loss) Per Share |
Earnings (loss)
per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common
shares outstanding during the reporting period including common stock issued effective the date committed. Common stock issuable
is considered outstanding as of the original approval date for the purposes of earnings per share computations. Diluted earnings
(loss) per common share is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares
of common stock outstanding during the year and (b) additional shares that would have been issued and potentially dilutive securities.
During the years ended December 31, 2013 and 2012 the diluted earnings (loss) per share was equivalent to the basic earnings (loss)
per share because all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive
securities consist of stock options and warrants outstanding at the end of the reporting period. Stock options outstanding as
at December 31, 2013 were 1,930,000 (December 31, 2012: 1,930,000). Warrants outstanding as at December 31, 2013 were nil (1,600,000
lapsed during the prior quarter) (December 31, 2012: 1,600,000).
The Company
has retroactively adjusted all share and per share information to reflect the reverse stock split, discussed in Note 5, in the
consolidated financial statements and notes thereto, as well as throughout the rest of this Report for all periods presented.
82 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
2.
Summary of Significant Accounting Policies (Continued)
| (o) | Recent
Accounting Pronouncements |
At present,
there are no other such pronouncements not yet effective that the Company expects will have a material impact on these consolidated
financial statements.
| 3. | Mineral
Properties and Exploration Expenses |
In Brazil,
Aurora has six (6) properties with an approximate total of 16,590 ha within the Tapajos Gold Province. The Exploration licence
areas are located in the vicinity of the Săo Domingos Township. The Company has conducted various degrees of exploration
activities on the properties and ranked the mineralised occurrences in order of merit and may discontinue such activities and
dispose of some of the rights to mineral exploration on parts of the property if further exploration work is not warranted. A
summary of these properties approved by the Department of National Production Minerals (DNPM) is set out below.
| a) | DNPM
Process 850.684/06 1,985.91 ha |
| b) | DNPM
Process 850.782/05 6,656.20 ha |
| c) | DNPM
Processes 850.012/06 and 850.013/06; 1128.08 ha and 750.55 ha respectively |
| d) | DNPM
Process 850.119/06 1,068.72 ha |
| e) | DNPM
Process 859.587/95 5,000.00 ha |
São
Domingos Project in the Municipality of Itaituba, in the Tapajos gold province of the State of Para, Brazil.
| a) | DNPM
Processes 850.684/06: 1,985.91 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.684/06, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. Aurora is the sole registered and beneficial holder of and owns and
possesses good title to the referred mineral rights. On September 13, 2006 Aurora submitted to DNPM one Exploration Claim for
gold covering an area of 4914.18 ha in the Municipality of Itaituba, State of Pará. According to the information obtained
such claim was correctly prepared and the required documents are in place but the area will be reduced to 1,985.91 due to overlapping
with third parties’ areas with priority rights. The Exploration Permit has not been granted yet. The above-mentioned area
is not related to any payments or royalties to third parties since Aurora claimed them directly.
83 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
3.
Mineral Properties and Exploration Expenses (Continued)
| b) | DNPM
Processes 850.782/05: 6,656.20 ha |
Aurora
has good title over the mineral rights object of the DNPM Process No. 850.782/05, which is valid and in force, free and clear
of any judicial and extrajudicial encumbrances and taxes. On November 8, 2005 it was submitted to DNPM the Exploration
Claim for gold in the Municipality of Itaituba, State of Pará. The Exploration Permit was granted on November
28, 2006 for a 3 (three) year period. The transfer to Aurora was approved on March 24, 2009 and on September 28, 2009
it was requested the renewal of the Exploration Permit. This area was reduced from 6,756 ha to 5,651.98 ha due to the
overlapping with Garimpeira (alluvial) Mining properties held by Mr. Celio Paranhos. However the DNPM ́s general
attorney in Brasilia agreed with Aurora’s legal thesis and nullified all applications filed by Mr. Paranhos (about to 1,900
applications). A new Exploration Permit rectifying the previous one was granted on August 20, 2010 for a 3 (three)
year period, for an area of 6,656.20 hectares. An application has been lodged for the extension of the license and
Aurora is awaiting the results of this. The renewal will be for a further 3 years and is expected to be granted in the near
future. The Annual Fees per Hectare (TAHs) for the 1st and 2nd years of the extension period have been properly paid. The
annual fee for the third year was paid in January 2013. No payments or royalties are due regarding the DNPM Process
850.782/05 since it was acquired through a permutation agreement with Altoro Mineração Ltda.
| c) | DNPM
Processes 850.012/06 and 850.013/06: 1,128.08 ha and 750.55 ha respectively |
The
exploration claims were submitted to DNPM on January 19, 2006, for gold covering an area of 1,128.08 ha and 750.55 ha respectively,
in the Municipality of Itaituba, State of Pará. According to information obtained such claims were correctly prepared and
the required documents are in place. The tenements 850.012/06 and 850.013/06 are held by Mr. Antonio Oliveira Ferreira and were
submitted to DNPM on January 19, 2006. The tenements are located at Itaituba, State of Pará and are valid and in force,
free and clear of any judicial and extrajudicial encumbrances and taxes, but the area was blocked since it is inside of a Garimpeira
Reserve. The transfer to Aurora will be submitted after the Exploration Permits are granted. There are no payments or royalties
related to the tenements according to the agreement entered into with the previous owner.
| d) | DNPM
Process 850.119/06: 1,068.72 ha |
Direct
access to the files of this Project at DNPM’s office were not sited, however analysis is based on the then current information
provided on DNPM’s website. The exploration claim was submitted to DNPM on March 7, 2006, for gold covering an area of 1,068.72
ha, in the Municipality of Itaituba, State of Pará. Aurora has good title over the mineral rights object of the DNPM Process
No. 850.119/06, which is valid and in force, free and clear of any judicial and extrajudicial encumbrances and taxes. Aurora is
the sole registered and beneficial holder of and owns and possesses good title to the referred mineral rights. The Exploration
Permit has not been granted yet. The above-mentioned area is not related to any payments or royalties to third parties since Aurora
claimed them directly.
| e) | DNPM
Process 859.587/95: 5,000 ha |
The
tenement 859.587/95 is held by Aurora and is valid and in force, free and clear of any judicial and extrajudicial
encumbrances and taxes. It is located at the Municipality of Itaituba, State of Pará. On November 27, 1995 it was
submitted to DNPM the Exploration Claim for gold. The Exploration Permit was granted on September 15, 2006 for a 3 (three)
years period covering an area of 5000 ha, and it was valid until September 15, 2009. On July 15, 2009 it was requested
the renewal of the Exploration Permit, which was granted on June 14, 2012. The renewal is valid until June 14, 2015, when
a Final Report must be submitted to DNPM with the results of the Exploration Activities. In order to have a Mining Permit granted,
Aurora must present the Economic Exploitation Plan and the Mining Concession Request in one year from the approval of the Final
Report.
84 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
During March
2012, the Company entered into debt settlement agreements for $105,000 of advances received from a director of the Company and
a company during fiscal 2011. As at December 31, 2013 advances payable were $32,000 (December 31, 2012: $32,000), which is non-interest
bearing and due on demand.
There were
no common stock transactions during the year ended December 31, 2013.
On
August 15, 2013, an Information Statement was filed with the Securities and Exchange Commission and was mailed or otherwise furnished
to the registered stockholders of Aurora in connection with the prior approval by the board of directors of Aurora, and receipt
by the board of approval by written consent of the holders of a majority of Aurora’s outstanding shares of common stock,
of a resolution to:
| - | Approve
a consolidation of the issued and outstanding shares of common stock of Aurora, without
correspondingly decreasing the number of authorized shares of common stock, on a five
“old” shares for every one “new” share basis, which will result
in a decrease of Aurora’s issued and outstanding share capital from 249,144,706
shares to approximately 49,828,942 shares of common stock, not including any rounding
up of fractional shares to be issued on consolidation; |
| - | Approve
a change of the par value of the shares of common stock of Aurora from a pre-consolidated
par value of $0.001 per share to an amended par value of $0.005 per share; and |
| - | Amend
Article Four of the Articles of Aurora as follows “FOURTH. The authorized capital
stock of this Corporation shall consist of 300 Million (300,000,000) shares of common
stock with a par value of $0.005 per share.” |
Section
228 of the Delaware General Corporation Law and the By-laws of Aurora provide that any action required or permitted to be taken
at a meeting of the stockholders may be taken without a meeting if stockholders holding at least a majority of the voting power
sign a written consent approving the action. On July 24, 2013, the board of directors of Aurora approved and recommended the Resolutions.
Subsequently, the holders of a majority of the voting power signed and delivered to Aurora written consents representing at least
57.4% of the voting shares of common stock approving the Resolutions, in lieu of a meeting. Since the holders of the required
majority of shares of common stock have approved the Resolutions, no other votes are required or necessary and no proxies are
being solicited with this Information Statement. Aurora has obtained all necessary corporate approvals in connection with the
Resolutions and your consent is not required and is not being solicited in connection with the approval of the Resolutions. The
Information Statement was furnished solely for the purpose of informing stockholders in the manner required under the Securities
Exchange Act of 1934 of these corporate actions before they take effect. The Resolutions will not become effective until (i) the
date the Company receives confirmation from FINRA regarding the approval and effective date of the corporate action, or, (ii)
such later date as approved by the board of directors, in its sole discretion. The Certificate of Amendment was filed with the
Secretary of State of Delaware and became effective October 22, 2013,
On October
5, 2012, the Company, completed the sale of 27,000,000 shares of the Company’s common stock for a purchase price of $5,000,000,
to Alltech Capital Limited pursuant to the terms of a subscription agreement entered into between the Company and the Alltech
Capital Limited dated September 21, 2012. As a result of the sale of 27,000,000 shares of the Company’s common stock of
approximately 54%, a change in control of the Company has occurred. As a condition to the closing of the transaction, the Company
agreed to increase the size of its board of directors to five (5) members and to appoint two board members selected by the Investor.
The board of directors appointed each of Messrs. Vladimir Bernshtein and Andrey Ratsko to serve as directors of the Company. Additionally,
Mr. Bernshtein has been named as the Company’s Chief Business Development Director.
85 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
5.
Common Stock (Continued)
In October
2011 the Company filed a Registration Statement on Form S-1 offering up to a maximum of 10,000,000 units of the Company's securities
at an offering price of $0.50 per Unit in a direct public offering, without any involvement of underwriters or broker-dealers.
Each Unit consists of one (1) share of common stock at a $0.005 par value per share and one (1) Stock Purchase Warrant. Each full
Warrant entitles the holder to purchase one additional share of common stock at a price of $1.00 for a period of two years commencing
November 1, 2011 through October 31, 2013. The Units will be sold by the Chief Executive Officer and Chief Financial Officer.
A Notice of Effectiveness was issued April 25, 2012. The offer expired January 20, 2013. To date, no funds were obtained from
this offering.
On April 16,
2012, the Company entered into subscription agreements for 263,200 shares of common stock at a purchase price of $0.30 per share
for a gross aggregate price of $78,960. Pursuant to the subscription agreements, each of the Investors has represented that they
are not a U.S. person; as such term is defined in Regulation S. In connection with the offering, the Company has agreed to pay
a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum $600,000 subscription.
During April
2012, the Company entered into a debt settlement agreement for $18,000 in accounts payable which was settled for 60,000 shares
of common stock at an issue price of $0.30 per share.
During March
2012, the Company entered into debt settlement agreements for advances received from a director of the Company and a company during
fiscal 2011 as well as $14,454 of amounts in accounts payable and accrued expenses. $119,454 was settled for 398,180 shares of
common stock at an issue price of $0.30 per share. As at March 31, 2012 advances on stock subscriptions were $37,513 and received
during that quarter.
In March 2012,
the Company entered into subscription agreements for 125,044 shares of common stock at a purchase price of $0.30 per share for
a gross aggregate price of $37,513. Share certificates were not issued as at March 31, 2012 and they were treated as an Advance
for Stock Subscriptions. The share certificates were issued in April 2012. Pursuant to the subscription agreements, each of the
Investors has represented that they are not a U.S. person; as such term is defined in Regulation S. In connection with the offering,
the Company has agreed to pay a cash commission equal to 8% of all funds received or an aggregate of up $48,000 on the total maximum
$600,000 subscription that is being offered.
On December
20, 2011, the Company entered into subscription agreements for 1,600,000 shares of common stock at a purchase price of $0.20 per
share for a gross aggregate price of $320,000. Attached to each unit of common stock is one (1) series A stock purchase warrant.
Each full Series A warrant entitles the holder to purchase an additional share of the Company’s common stock at an exercise
price of $0.40 per share for a period of eighteen months commencing on December 20, 2011 and expiring on June 20, 2013. Pursuant
to the subscription agreements, each of the Investors has represented that they are not a U.S. person; as such term is defined
in Regulation S. In connection with the offering, the Company has agreed to pay a cash commission equal to 8% of all funds received
or an aggregate of up $25,600. The total amount of commission paid was $8,800. These warrants expired on June 20, 2013.
86 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| 6. | Stock
Options and Warrants |
In 2007, the
Company's Board of Directors approved the 2007 Stock Option Plan (amended September 29, 2008) (“the Plan”) to offer
an incentive to obtain services of key employees, directors and consultants of the Company. The Plan provides for the reservation
for awards of an aggregate of 10% of the total shares of Common Stock outstanding from time to time. No Plan participant may receive
stock options exercisable for more than 500,000 shares of Common Stock in any one calendar year. Under the Plan, the exercise
price of an incentive stock option must be at least equal to 100% of the fair market value of the common stock on the date of
grant (110% of fair market value in the case of options granted to employees who hold more than 10% of the Company's capital stock
on the date of grant). The term of stock options granted under the Plan is not to exceed ten years and the stock options vest
immediately upon granting.
The following
is a summary of stock option activity and status at December 31, 2013:
Options Outstanding and Exercisable By
Quarter | |
Stock Options # | | |
Weighted Average Exercise
Price $ | | |
Remaining Contractual
Life (years) | | |
Aggregate Intrinsic value | |
As at December 31, 2011 | |
| 1,810,000 | | |
| 0.550 | | |
| 4.28 | | |
| 36,500 | |
Forfeited during quarter | |
| (40,000 | ) | |
| 1.300 | | |
| — | | |
| — | |
Granted during quarter | |
| 320,000 | | |
| 0.250 | | |
| — | | |
| — | |
As at March, 31, 2012 | |
| 2,090,000 | | |
| 0.450 | | |
| 4.21 | | |
| 42,000 | |
Granted during quarter | |
| 40,000 | | |
| 0.325 | | |
| — | | |
| — | |
As at June, 30, 2012 | |
| 2,130,000 | | |
| 0.485 | | |
| 3.97 | | |
| 34,125 | |
Forfeited during quarter | |
| (200,000 | ) | |
| 1.300 | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at September 30, 2012 | |
| 1,930,000 | | |
| 0.400 | | |
| 3.74 | | |
| 52,500 | |
Forfeited during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at December 31, 2012 | |
| 1,930,000 | | |
| 0.400 | | |
| 3.51 | | |
| Nil | |
Forfeited during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at March 31, 2013 | |
| 1,930,000 | | |
| 0.400 | | |
| 3.28 | | |
| Nil | |
Forfeited during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at June 30, 2013 | |
| 1,930,000 | | |
| 0.400 | | |
| 3.06 | | |
| Nil | |
Forfeited during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at September 30, 2013 | |
| 1,930,000 | | |
| 0.400 | | |
| 2.83 | | |
| Nil | |
Forfeited during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
Granted during quarter | |
| — | | |
| — | | |
| — | | |
| — | |
As at December 31, 2013 | |
| 1,930,000 | | |
| 0.400 | | |
| 2.60 | | |
| Nil | |
87 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
6. Stock
Options (continued)
The
aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for all “in-the-money” options
(i.e. the difference between the Company’s closing stock price on the last trading day of the fiscal year and the exercise
price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised
their options as of each date presented.
The
total fair value of options granted for the three months ended December 31, 2013 was nil (December 31, 2012: $nil) and expensed
in full as options were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing
model that takes into account the exercise price, the expected life of the option, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.
Management determined 2.50 years to be the average expected likely life of the options and utilized the simplified method due
to the fact that the Company has not had significant options granted to develop historical data to provide a reasonable basis
to estimate option lives.
The
total fair value of options granted for the three months ended September 30, 2013 was nil (September 30, 2012: $nil) and expensed
in full as options were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing
model that takes into account the exercise price, the expected life of the option, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.
Management determined 2.50 years to be the average expected likely life of the options and utilized the simplified method due
to the fact that the Company has not had significant options granted to develop historical data to provide a reasonable basis
to estimate option lives.
The
total fair value of options granted for the three months ended June 30, 2013 was nil (June 30, 2012: $11,979) and expensed in
full as options were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing
model that takes into account the exercise price, the expected life of the option, the share price at grant date (April 10, 2012)
and expected price volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate
(4.50% used) for the term of the option. Management determined 2.50 years to be the average expected likely life of the options
and utilized the simplified method due to the fact that the Company has not had significant options granted to develop historical
data to provide a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of each option
tranche and rates of 161.04% respectively were used.
The
total fair value of options granted for the period ended March 31, 2013 was nil (March 31, 2012: $43,681) and expensed in full
as options were vested in full on grant. The fair value of options are determined using the Black Scholes option pricing model
that takes into account the exercise price, the expected life of the option, the share price at grant date (January 13, 2012)
and expected price volatility of the underlying share, the expected dividend yield (nil assumed) and the risk free interest rate
(4.50% used) for the term of the option. Management determined 2.50 years to be the average expected likely life of the options
and utilized the simplified method due to the fact that the Company has not had significant options granted to develop historical
data to provide a reasonable basis to estimate option lives. Volatility rates were calculated at the grant date of each option
tranche and rates of 120.89% were used.
During
the quarter ended March 31, 2012, Cameron Richardson departed the Company, an exercise notice for the 40,000 options held was
not lodged and consequently the options lapsed during the quarter.
Effective
January 13, 2012, the Company’s board of directors granted 320,000 stock purchase options pursuant to the Company’s
2007 Stock Option Plan. Each of the Options has an issue date, effective date and vesting date of January 13, 2012, with an exercise
price of $0.25 per share. The term of these Options are five years. The Options are exercisable at any time from the grant date
up to and including January 12,2017.
As
of December 31, 2013, there are nil outstanding Warrants to purchase shares of common stock. All warrants previously outstanding
lapsed on June 20, 2013.
88 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
| 7. | Related
Party Transactions |
Related party
transactions not disclosed elsewhere in these consolidated financial statements include:
| a) | During
the fiscal year ended December 31, 2013 consulting fees of $445,337 (December 31, 2012:
$301,714) were incurred to directors and officers (or companies of the officers and directors
other than Coresco which is disclosed below) of the Company. The transactions were recorded
at the exchange amount, being the value established and agreed to by the related parties. |
| b) | Coresco
(a company that the CEO and CFO are affiliated with) also charged for geophysical consulting
activities and other exploration management fees for a total of $126,000 during the year
ended December 31, 2013 (December 31, 2012: Coresco charged for S1 fund raising and geophysical
consulting activities for a total of $79,171). |
| c) | Included
in accounts payable and accrued expenses and advances payable (related parties) as at
December 31, 2013 and December 31, 2012 were $42,800 and $126,220 respectively payable
to officers and directors of the Company for consulting fees and various expenses incurred
on behalf of the Company. |
| 8. | Non-Cash
Investing and Financing Activities |
There were
no non-cash investing and financings payments during the year ended December 31, 2013 (December 31, 2012: nil).
| 9. | Vehicles
and Other Equipment |
| |
December 31, | |
| |
2013 | | |
2012 | |
| |
($) | | |
($) | |
Mining Equipment | |
| 288,300 | | |
| 2,889 | |
Vehicles | |
| 129,457 | | |
| 96,623 | |
Office Furniture and Fixtures | |
| 4,005 | | |
| 3,532 | |
Subtotal | |
| 421,762 | | |
| 103,044 | |
Accumulated depreciation | |
| (44,230 | ) | |
| (5,128 | ) |
Net book value | |
| 377,532 | | |
| 97,916 | |
89 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The
Company and its subsidiary operate in several tax jurisdictions, and its income is subject to various rates of taxation. The Company
has net losses for tax purposes in the United States and Brazil totaling approximately $14,158,885 and $9,064,099 respectively,
which may be applied against future taxable income. Accordingly, there is no tax expense for the years ended December 31, 2013
and 2012. The potential tax benefits arising from these losses have not been recorded in the consolidated financial statements
as a full valuation allowance has been recorded against them. The Company evaluates its valuation allowance requirements on an
annual basis based on projected future operations. When circumstances change and this causes a change in management's judgment
about the recoverability of deferred tax assets, the impact of the change on the valuation allowance is reflected in current operations.
The right to claim the tax losses in the United States expire according to the following table:
Fiscal Year of Expiry | |
Amount $ | |
2018 | |
| 331,000 | |
2019 | |
| 795,000 | |
2020 | |
| 550,000 | |
2022 | |
| 138,000 | |
2023 | |
| 90,000 | |
2024 | |
| 222,000 | |
2025 | |
| 457,000 | |
2026 | |
| 1,094,000 | |
2027 | |
| 800,000 | |
2028 | |
| 561,000 | |
2029 | |
| 479,000 | |
2030 | |
| 2,065,000 | |
2031 | |
| 3,921,183 | |
2032 | |
| 753,861 | |
2033 | |
| 1,901,841 | |
| |
| 14,158,885 | |
Tax losses
carried forward in Brazil have no expiration date and are available to offset up to 30% of annual income before tax in any year.
90 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
The
tax effects of temporary differences that give rise to the Company's net deferred tax assets are as follows:
| |
2013 $ | | |
2012
$ | |
Tax loss carry forwards | |
| 7,895,814 | | |
| 6,737,948 | |
Valuation allowance | |
| (8,048,548 | ) | |
| (6,890,682 | ) |
Stock compensation expense | |
| 152,734 | | |
| 152,734 | |
| |
| — | | |
| — | |
The reconciliation
of income tax computed at the federal statutory rate to income tax expense is as follows:
| |
2013
$ | | |
2012
$ | |
Tax at statutory rate | |
| (1,157,866 | ) | |
| (408,127 | ) |
Movement in deferred tax asset | |
| — | | |
| 191,760 | |
Change in valuation allowance for deferred tax asset | |
| 1,157,866 | | |
| 135,779 | |
Other | |
| — | | |
| 80,588 | |
Income tax expense | |
$ | — | | |
$ | — | |
On
February 13th 2014, Alltech Capital Limited subscribed for 1,360,000 shares at a price of $0.074 and received one warrant for
each share valid for 2 years at a strike of $0.15cents.
91 | AURORA GOLD CORPORATION |
AURORA GOLD CORPORATION FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS) ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2013 |
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
amended report to be signed on its behalf by the undersigned, thereunto duly authorized.
Aurora Gold Corporation
Registrant
/s/ Lars Pearl
By: Lars Pearl, Chief Executive
Officer and President, Principal Executive Officer and Director
/s/ Agustin Gomez de Segura
By: Agustin Gomez de Segura, Director
/s/ Ross Doyle
By: Ross Doyle, Chief Financial
Officer
/s/ Vladimir Bernshtein
By: Vladimir Bernshtein, Chief Development
Officer and Director
/s/ Andrey Ratsko
By: Andrey Ratsko, Chief Technical
Officer and Director
/s/ Gorden Glenn
By: Gorden Glenn, Director
Dated:
November 20, 2014
Pursuant to
the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.
Aurora Gold
Corporation
Registrant
/s/ Lars Pearl
By: Lars Pearl, Chief Executive
Officer and President, Principal Executive Officer and Director
/s/ Agustin Gomez de Segura
By: Agustin Gomez de Segura, Director
/s/ Ross Doyle
By: Ross Doyle, Chief Financial
Officer
/s/ Vladimir Bernshtein
By: Vladimir Bernshtein, Chief Development
Officer and Director
/s/ Andrey Ratsko
By: Andrey Ratsko, Chief Technical
Officer and Director
/s/ Gorden Glenn
By: Gorden Glenn, Director
Dated: November 20,
2014
92 | AURORA GOLD CORPORATION |
Exhibit
31.1
Certification
of Chief Executive Officer
Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
I, Lars Pearl,
certify that:
| 1. | I have reviewed this
Amendment No. 2 to Form 10-K of Aurora Gold Corporation for the Fiscal Year Ended December 31, 2013. |
| 2. | Based on
my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the
period covered by this report. |
| 3. | Based on
my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations
and cash flows of the registrant as of, and for, the periods presented in this report. |
| 4. | The registrant's
other certifying officers and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in exchange Act Rules 13a-15(f)
and 15d-15(f)) for the Registrant and have: |
| a) | Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this report is being prepared; |
| b) | Designed
such internal controls over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated
the effectiveness of the registrant’s disclosure controls and procedures and presented
in this report our conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on such evaluation;
and |
| d) | Disclosed
in this report any change in the registrant’s internal control over financial reporting
that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected,
or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting. |
| 5. | The registrant's
other certifying officer(s) and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant’s auditors and
the audit committee of the registrant's board of directors (or persons performing the
equivalent functions): |
| a) | All significant
deficiencies and material weakness in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial data and information; and |
| b) | Any fraud,
whether or not material, that involves management or other employees who have a significant
role in the registrant's internal control over financial reporting. |
/s/
Lars Pearl |
|
Dated:
November 20, 2014 |
By: Lars Pearl |
|
|
Title: Chief
Executive Officer and President, Principal Executive Officer and Director
Exhibit
31.2
Certification
of Chief Financial Officer
Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
I, Ross Doyle,
certify that:
| 1. | I have reviewed this Amendment
No. 2 to Form 10-K of Aurora Gold Corporation for the Fiscal Year ended December 31, 2013. |
| 2. | Based on
my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the
period covered by this report. |
| 3. | Based on
my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations
and cash flows of the registrant as of, and for, the periods presented in this report. |
| 4. | The registrant's
other certifying officers and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in exchange Act Rules 13a-15(f)
and 15d-15(f)) for the Registrant and have: |
| a) | Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this report is being prepared; |
| b) | Designed
such internal controls over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated
the effectiveness of the registrant’s disclosure controls and procedures and presented
in this report our conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on such evaluation;
and |
| d) | Disclosed
in this report any change in the registrant’s internal control over financial reporting
that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected,
or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting. |
| 5. | The registrant's
other certifying officer(s) and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant’s auditors and
the audit committee of the registrant's board of directors (or persons performing the
equivalent functions): |
| a) | All significant
deficiencies and material weakness in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial data and information; and |
| b) | Any fraud,
whether or not material, that involves management or other employees who have a significant
role in the registrant's internal control over financial reporting. |
/s/
Ross Doyle |
|
Dated:
November 20, 2014 |
By: Ross Doyle |
|
|
Title: Chief
Financial Officer
Exhibit
32.1
Certification
of Chief Executive Officer
Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Lars Pearl,
President, Chief Executive Officer of Aurora Gold Corporation (the “Company”), hereby certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | The Amendment No. 2 to Annual
Report on Form 10-K of Aurora Gold Corporation for the year ended December 31, 2013 (the
“Report”) which this certification accompanies, fully complies with the requirements
of section 13(a) or 15(d) of the Securities Exchange Act of 1934: and |
| 2. | The information
contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of Aurora Gold Corporation. |
/s/
Lars Pearl |
|
Dated:
November 20, 2014 |
By: Lars Pearl |
|
|
Title: Chief
Executive Officer, President, Principal Executive Officer and Director
This certification
accompanies this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company
for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required
by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form
within the electronic version of this written statement required by Section 906, has been provided to the Company and will be
retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
Exhibit
32.2
Certification
of Chief Financial Officer
Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Ross Doyle,
Chief Financial Officer of Aurora Gold Corporation (the “Company”), hereby certify, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | The Amendment No. 2 to Annual
Report on Form 10-K of Aurora Gold Corporation for the year ended December 31, 2013 (the
“Report”) which this certification accompanies, fully complies with the requirements
of section 13(a) or 15(d) of the Securities Exchange Act of 1934: and |
| 2. | The information
contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of Aurora Gold Corporation. |
/s/
Ross Doyle |
|
Dated:
November 20, 2014 |
By: Ross Doyle |
|
|
Title: Chief
Financial Officer
This certification
accompanies this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company
for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required
by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form
within the electronic version of this written statement required by Section 906, has been provided to the Company and will be
retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.