The accompanying notes are an integral part of these Interim financial statements.
The accompanying notes are an integral part of these Interim financial statements.
The accompanying notes are an integral part of these Interim financial statements.
The accompanying notes are an integral part of these Interim financial statements
The accompanying notes are an integral part of these Interim financial statements.
CANAM URANIUM CORP.
(An Exploration Stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
April 30, 2007
NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION
Canam Uranium Corp. (the “Company”) is an exploration stage company that was organized to engage in the business of natural resource exploration in the United States and Canada. The Company was incorporated on June 7, 2004 in the State of Nevada and has an October 31 fiscal year end.
Going concern
The Company commenced operations on June 7, 2004 and has not realized any revenues since inception. The Company has a deficit accumulated to the period ended April 30, 2007 in the amount of $3,516,780. The ability of the Company to continue as a going concern is dependent on raising capital to fund its business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company is funding its initial operations by way of Private Placements. As of April 30, 2007 the Company had issued 86,110,000 shares of common stock in the capital of the Company and had received cash of $1,204,505.
Unaudited Interim Financial Statements
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-QSB of Regulation S-B. They do not include all information and footnotes required by generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there have been no material changes in the information disclosed in the notes to the financial statements for the year ended October 31, 2006 included in the Company’s Form 10KSB filed with the Securities and Exchange Commission. The interim unaudited consolidated financial statements should be read in conjunction with those financial statements included in the Form 10KSB. In the opinion of management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended April 30, 2007 are not necessarily indicative of the results that may be expected for the year ending October 31, 2007.
The organization and business of the Company, significant accounting policies followed by the Company and other information are contained in the notes to the Company’s audited financial statements filed as part of the Company’s Form 10-KSB for the year ended October 31, 2006.
Natural resource properties
Natural resource properties consist of exploration and mining concessions, options and contracts. Acquisitions, leasehold costs and exploration costs are expensed as incurred until an independent feasibility study has determined that the property is capable of economic commercial production.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles 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 period. Actual results could differ from those estimates.
CANAM URANIUM CORP.
(An Exploration Stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
April 30, 2007
NOTE 2 - FIXED ASSETS
Fixed assets consist of the following:
| | | April 30 | | October 31 | |
| | | 2007 | | 2006 | |
| Computer equipment | | $ | 1,200 | | $ | 1,200 | |
| Furniture and fixtures | | | 4,471 | | | - | |
| Total | | | 5,671 | | | 1,200 | |
| Less accumulated depreciation | | | 480 | | | 360 | |
| Net book value | | $ | 5,191 | | $ | 840 | |
Computer equipment is amortized at 20% per annum on a straight line basis.
Furniture and equipment was acquired at the end of the quarter - amortization will commence May 1, 2007 at 20% per annum on a straight line basis.
NOTE 3 – NATURAL RESOURCE PROPERTIES and RELATED EXPLORATION DEVELOPMENT
The Company acquired through its previous President, an option to purchase a 100% undivided interest in two mining claims in the Lillooet Mining Division of British Columbia, Canada. The claims are named TIM and PUN and comprise of 36 claims.
Under the claim agreement (amended September 8, 2005 and March 31, 2006), annual payments of $25,000 commencing January 1, 2008 were required as long as an interest is held in the claims, and minimum exploration expenditures of $15,000 and $40,000 were required on or before October 31, 2006 and 2007.
The Board of Directors of the Company, after lengthy analysis prior to and during a board meeting of October 2, 2006 elected to refocus the Company's exploration activity into the area of uranium exploration, as they felt that there was better prospect for shareholder returns. Consequently, they chose not to renew these claims and allowed them to lapse.
On October 20, 2006, the Company entered into an agreement with El Nino Ventures Inc. to acquire a 60% option on the Bancroft properties in the Province of Ontario, Canada totaling 3,800 hectares over numerous individual claims. The option required the payment of CDN$40,000 on closing and subsequent payments of CDN$60,000 on November 15 2006, annual payments of CDN$20,000 as well as the payment of CDN$1,000,000 over a two year period on exploration activities. In addition, the Company has issued El Nino Ventures Inc. 275,000 post split shares of its stock, restricted under Rule 144 of the Securities Act of 1933. In order to earn an 80% option, the Company is required to issue a further 300,000 restricted post split shares and complete a further CDN$1,500,000 in exploration expenditures in the third and fourth year after the execution of the agreement. The properties are also subject to NSR payments of 3% in the event of mineral production, and the Company may purchase 1% of the NSR for CDN$250,000, or total purchase of the NSR for CDN$750,000.
On November 16, 2006, the company entered into an Agreement with Geomode Mineral Exploration Ltd. to acquire a 100% undivided interest in two mineral claims owned by Geomode known as the BALD and OYAMA claims in the Province of British Columbia, Canada, totalling 1,037 hectares. They are collectively known as the OK Lake claims. In order to earn its 100% interest, the Company is required to pay $25,000 on signing of the Agreement, issue 500,000 of its common shares (restricted) to the owner of the claims, and carry out exploration expenditures of $50,000, or issue 250,000 restricted shares on or before November 30, 2007, and exploration expenditures of $200,000 or 500,000 common shares (restricted) on or before November 30, 2008. The properties are subject to a 1% NSR which may be purchased by the Company for $1,000,000.
CANAM URANIUM CORP.
(An Exploration Stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
April 30, 2007
On November 29, 2006, the Company entered into an Agreement with Northwind Resources Ltd. to acquire a 100% interest in 11 mineral property titles, collectively known as the Wheeler-Beckett Claims in the Athabasca basin region of the Province of Saskatchewan, Canada, totalling 51,100 hectares in size. In order to earn its 100% interest, the Company is required to make cash payments of CDN$150,000 on Agreement execution date, CDN$100,000 on the anniversary of the Agreement execution date. In addition, the Company is required to issue 500,000 of its common shares (restricted) on execution date, and an additional 500,000 restricted shares on the anniversary date of the Agreement's execution. The property is subject to a 2.5 % NSR of which 2.0% may be purchased by the Company for CDN$1,000,000.
In March 2007, the Company advanced $55,555 to El Nino Resources for the first phase of the spring drilling program on the Bancroft properties. In addition, the Company paid a total of $15,730 in February and April 2007 for the extensive preliminary mapping of the Wheeler Beckett claims.
NOTE 4 – STOCKHOLDERS’ EQUITY
The Company’s capitalization is 200,000,000 common shares with a par value of $0.001 per share, and 25,000,000 preferred shares with no par value.
In November 2006, the Company issued a total of 1,475.000 shares, valued at $0.10 per share, as part payment for the El Nino property (275,000 restricted shares), the OK Lake properties (500,000 restricted shares.) and the Wheeler -Beckett claims (700,000 restricted shares in total, including fees).
Also in November, the Company issued 1,725,000 shares to various investors who had subscribed for shares at prices of $0.10 and $0.25 per share. Proceeds net of finder's fees were $157,847.
In April 2007, the Company issued 810,000 shares to various investors who had subscribed for shares at prices ranging from $0.10 to $0.25 per share, for proceeds of $154,359. Additionally, the Company issued 600,000 shares at $1.00 per share upon exercise of an option agreement for total proceeds of $600,000. Also in April 2007, the Company issued 260,000 shares to a director for services, valued at $0.19 per share, and 250,000 shares valued at $0.53 per share (weighted average of recent subscriptions) for fees associated with a debenture financing.
All references in these financial statements to number of shares, price per share and weighted average number of common shares outstanding prior to the forward split have been adjusted to record the effect of the forward split on a retroactive basis.
OPTIONS TO ACQUIRE SHARES OF COMMON STOCK
The Company granted consultants to the Company options to acquire 2,650,000 shares of common stock of the Company at $1.19 per share within five years from February 19, 2007. In order to calculate the option expense of $1,711,333, the Company used the Black-Scholes option pricing formula assuming a risk free rate of 4.7% and due to limited market pricing data for the shares, a variability factor of 100%.
See also Note 7
CANAM URANIUM CORP.
(An Exploration Stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
April 30, 2007
NOTE 5 – RELATED PARTY TRANSACTIONS
These transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.
The Company owes a director and President of the Company $2,720. There are no definite repayment terms, no security or accruing interest. Fair value cannot be determined.
The Company owes the previous sole director and President of the Company $3,000. There are no definite repayment terms, no security or accruing interest. Fair value cannot be determined.
As of September 1, 2006, the Company has been subletting premises from a company controlled by its President and CEO. Total payments until April 30, 2007 were $29,107. In April 2007 the Company issued 260,000 shares to a director for his services valued at $49,400.
NOTE 6 – INCOME TAXES
The Company has adopted the FASB No. 109 for reporting purposes. As of October 31, 2006, the Company had net operating loss carry forwards of approximately $54,705 that may be available to reduce future years’ taxable income and will expire in 2024. Availability of loss usage is subject to change of ownership limitations under Internal Revenue Code 382. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the future tax asset relating to these tax loss carry forwards.
NOTE 7 – NOTES PAYABLE
The Company issued a Note to a third party investor in the amount of $50,000 on September 6 2006 for a one year term, bearing interest at 10% per annum. The note is convertible into 200,000 post split shares of the Company at the Company's option when certain market conditions exist. The interest recorded on the note in the previous quarter has been reversed to reflect the fact that this was included in the value of the option granted to acquire stock. On January 31 2007, the party agreed to waive its interest on the note in exchange for an option to acquire 600,000 shares of the Company’s common stock at $1 per share on or before April 1, 2007, and 666,667 shares at $1.50 per share on or before January 1, 2008. During the quarter, the investor exercised its first option, and indicated that it would bring forward the exercise date of the second option to May 31, 2007. The option has been valued at $302,673.
On March 2, 2007 the Company signed an agreement with Divine Capital Markets LLC to raise convertible debenture financing for the Company. The terms of the debenture were for a maximum of $400,000 to be raised at an interest rate of 6% for three years. The debentures are convertible into common shares of the Company at the greater of 75% of the 20 day lowest closing bid price of the Company stock and $.05 per share at any time on or after six months from the date of issuance of the debenture. The derivative contract liability has been calculated to be $340,550 to be amortized straight line over the life of the debenture. Divine received 250,000 restricted shares of the Company, valued at $0.53 per share (the weighted average of recent share issuance prices) as well as a 13% commission on total proceeds. The gross principal amount raised was $370,000. During the quarter ended April 30, 2007 the Company borrowed, on a bridge financing, $300,000 from two unrelated parties. The bridge loans were repaid in the same quarter, plus interest of $30,000.
CANAM URANIUM CORP.
(An Exploration Stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
April 30, 2007
NOTE 8 – SUBSEQUENT EVENTS
On May 1, 2007, the Company advanced $495,652 to G. Santos Exploration as a deposit against an aerial electromagnetic survey of the Wheeler Beckett claims in the Athabasca Basin in Saskatchewan, Canada. This survey will be completed during the summer of 2007.
On May 25, 2007 the Company borrowed $200,000 from Confederated Capital Corp. to meet financial commitments on the Bancroft project. The terms of the loan require it to be repaid with 10% interest on or before July 25, 2007.
Also on May 25, 2007, the Company received notice from Advantage Systems Enterprises that it would not bring forward the exercise date of its option to acquire 666,667 shares at $1.50 due to a weakening in the market price for the Company’s stock. The option is due to expire on January 1, 2008.
The Company also acquired additional properties in Saskatchewan and Ontario, Canada. On May 28th 2007, the Company agreed to finalize its acquisition of the Don McCarthy claim in the Athabasca basin area of Saskatchewan, Canada from Geomode Mineral Exploration Ltd. To earn a 100% interest in the Don McCarthy Claim, CanAm is required to pay an aggregate of US$400,000 and issue 3,000,000 common shares to the vendor over three years. First year commitments require the issuance of 2,000,000 common shares and payment of $100,000, of which $50,000 is due upon closing (paid) and $50,000 is to be paid on or before December 22, 2007. The balance of commitments calls for the payment of $100,000 and 500,000 shares on or before May 25th, 2008, and the payment of $200,000 and 500,000 shares on or before May 25th, 2009. A one percent (1%) NSR has been reserved in favor of the vendor, which can be purchased by CanAm for $3,000,000.
On June 1, 2007, the Company completed an agreement to acquire a 100% interest in the Reilly Uranium Property in the Sault St. Marie district of Ontario Canada from Rubicon Minerals Corp. The terms of the transaction include the option to purchase 100% of the property by the staged issuance of 80,000 CanAm common shares and $110,000 in cash payments in Canadian Dollars. The underlying vendor retains a 2% NSR royalty of which 1% can be bought back by the Company for $1 million and the first right of refusal for the remaining 1%. The payment schedule is as follows: an ``Initial Payment'' of $30,000 on signing of this Option Agreement, an additional $10,000 on the first anniversary date of the Option Agreement, an additional $15,000 on the second anniversary date of the Option Agreement; an additional $20,000 on the third anniversary date of the Option Agreement; and, a final payment of an additional $35,000 on the fourth anniversary date of the Option Agreement. Issue to the Owners a total of 80,000 common 144 shares in the capital stock of CanAm for the grant of the Mineral Claims according to the following schedule, 20,000 common shares to the Owner within 10 days of the approval of the terms of this Option Agreement; 20,000 additional common shares on the first anniversary date of the Option Agreement; 20,000 additional common shares on the second anniversary date of the Option Agreement; and, 20,000 additional common on the third anniversary date of the Option Agreement.
On May 1, 2007, the Company issued 50,000 shares to a consultant, who exercised an option to acquire 50,000 shares at a strike price of $1.19 per share.
On June 15, 2007 the Company issued 500,000 shares of common stock pursuant to a consulting agreement for services rendered and filed under a Form S8. The stock was trading at $0.85 per share at the date of issue.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
MANAGEMENT’S DISCUSSION AND ANALYSIS
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing elsewhere in this Form 10-QSB. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements.
Overview
References in this Quarterly Report of Form 10-QSB/A to “CanAm”, “the Company”, “we”, “us,” and “our” refer to CanAm Uranium Corp., a Nevada corporation. The Company split its shares on an 8 for 1 basis effective November 16, 2006. All references to shares in this document refers to post split numbers.
We were incorporated in the State of Nevada on June 7, 2004. We are engaged in the acquisition and exploration of mining properties. On August 11, 2006, Puneet Sharan resigned as President, and as the reigning sole director, appointed Ryan Gibson as President and a Director, and David Hayes, as Chief Financial Officer and as a Director. Subsequently, Mr. Sharan resigned as a Director. On October 5, 2006, Mr. Gibson acquired, directly and indirectly, an aggregate of approximately 56,000,000 shares of common stock from Mr. Sharan, which at the time represented approximately 70% of the issued and outstanding shares of common stock of CanAm and approximately 70% of the voting power of all issued and outstanding securities of CanAm. Mr. Gibson still retains voting control of the majority of the voting securities of CanAm.
Our only revenue has been interest on term deposits, we have achieved losses since inception, have no operations, have been issued a going concern opinion and rely upon the sale of our securities to fund operations.
On October 22, 2006, CanAm elected to not pay annual fees due on October 31, 2006, to the Province of British Columbia, Canada, in connection with maintaining rights to two mining claims, entitled the “Pun” claim and the “Tim” claim, respectively, in British Columbia, Canada, on the basis that the real property underlying each claim does not likely contain sufficient quantities of zinc, copper, silver, gold or other mineralized material to merit further exploration. The effect of such election will be that CanAm will not have the right to explore for and develop mineralized material underlying the Pun and Tim claims.
On October 23, 2006, CanAm entered into a Property Option Agreement with El Nino Ventures Inc. (“El Nino”) pursuant to which CanAm acquired an option to purchase certain mining claims, entitled “The Bancroft Uranium Projects” (Bancroft) claims. The Company entered into an option agreement with El Nino Ventures Inc (TSX-V-ELN) to acquire up to an 80% interest in eight uranium properties located in the Bancroft area of southeastern Ontario. The properties comprise of 37 mineral claims covering approximately 9,765 acres (3,952 hectares), and are located 10 - 40 km to the east of the town of Bancroft, Ontario, Canada. In order to earn a 60% interest in the properties, CanAm must make an initial payment of $33,898 (CDN$40,000) made on the execution date, and $21,186 (CDN$25,000) paid November 15th 2006 with the issuance of 275,000 post split common shares (restricted) and complete $847,458 (CDN$1,000,000) in exploration work over two years. A total of $114,407 (CDN$135,000) has been paid as of January 16, 2007 towards exploration. The Company is also committed to making annual payments of $16,949 (CDN$20,000). To earn an additional 20% interest in the properties, CanAm must issue 300,000 shares of common stock and complete a further $1,272,186 (CDN$1,500,000) in exploration work over two years. The properties are subject to a 3% Net Smelter Royalty (NSR) from future production, and the NSR may be purchased by the Company in increments of 1% for $211,864 (CDN$250,000).
On November 16, 2006, the company entered into an Agreement with Geomode Mineral Exploration Ltd. to acquire a 100% undivided interest in two mineral claims owned by Geomode known as the BALD and OYAMA claims in the Province of British Columbia, Canada, totaling 1,037 hectares. They are collectively known as the OK Lake claims. In order to earn its 100% interest, the Company was required to pay $25,000 on signing of the Agreement (which it paid), issue 500,000 of its shares of common stock to the owner of the claims, and carry out exploration expenditures of $50,000 on or before November 30, 2007 and $50,000 on or before November 30 2008.
On November 29, 2006, CanAm entered into a Property Option Agreement with Northwind Resources Inc. (“Northwind”), pursuant to which CanAm acquired an option to purchase certain mining claims, entitled the “Wheeler-Beckett” claims. The Wheeler-Beckett claims are leases to mine mineralized material, granted by the Province of Saskatchewan, Canada, and provide the holder of the leases the exclusive right to explore for and develop mineralized material in 11 contiguous claims, totaling 51,100 hectares of real property, located on the eastern edge of the Athabasca Basin, Province of Saskatchewan, Canada.
To exercise its option to acquire the leases for the Wheeler-Beckett claims, CanAm must pay $211,864 (CDN $250,000) and issue 1,000,000 restricted shares of common stock to Northwind. The payment schedule under the Property Option Agreement provides for an initial payment of $127,119 (CDN $150,000), and 500,000 restricted shares of CanAm’s common stock, which payment was made to Northwind on November 29, 2006. To complete the exercise of its option, CanAm must pay to Northwind $84,746 (CDN $100,000) and 500,000 restricted shares of common stock not later than the first year anniversary date of the date of the Property Option Agreement. Additionally, the Property Option Agreement provides, among other things, that CanAm pay a royalty equal to two and one-half percent (2.5%) of net returns from future production, four-fifths (4/5) of such 2.5% of which CanAm may purchase for $847,460 (CDN $1,000,000). Within the first year, starting September 26, 2006,the date on which the claim was originally posted, there are no obligations for exploration fees associated with regulations of the Saskatchewan Provincial Government for Mining Claims up to September 26,2007, however, CanAm Uranium Corp must pay or incur exploration costs of up to $10.17 per hectare ($12 CDN) or $519,661 ($613,200 CDN) when multiplied by the claim size of 51,100 hectares after September 26, 2007 per year to maintain the claims. At the claim anniversary date of 10 years, this cost increases to $21.19 ($25CDN) per hectare. Filing of the exploration fees are required annually by the Saskatchewan Government and therefore, the claims require the Company to submit and pay for nominal expenses associated with preparing the documentation for the Saskatchewan Government.
In connection with the Property Option Agreement, CanAm has issued 200,000 shares of common stock to a consultant of Northwind Resources, Spikat Management Ltd. (“Spikat”). Spikat is not an affiliate of CanAm or any of CanAm’s directors or officers. CanAm sold the securities to Spikat pursuant to Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act of 1933, as amended, on the basis that the securities were sold outside of the US, to a non-US person, and with no directed selling efforts in the US.
CanAm will focus its primary business activity on raising sufficient funds to exercise its option to acquire the Wheeler-Beckett claims and acquiring of rights to explore for and develop uranium and other mineralized material in other geographical locations and explore the Halo Property which is one of the 8 “Bancroft Claims”. There is no assurance that CanAm will be able to raise sufficient funds in order to exercise its option to acquire the Wheeler-Beckett claims, Bancroft Claims, or to further expand its business.
Canadian jurisdictions, generally speaking, allow a mineral explorer to claim a portion of available Crown lands as its exclusive area for exploration by depositing posts or other visible markers to indicate a claimed area. The process of posting the area is known as staking. CanAm must pay annual fees to the Crown to maintain its exploration and development under its licenses. There is no assurance that CanAm will have sufficient funds to pay such fees to maintain it mining rights under the licenses.
The Company began drilling on the Bancroft properties in April of 2007, and preliminary results were announced in a news release on May 11, 2007.
CanAm released assay results for the first four drill holes. Best results to date have been achieved in DDH H-4, the upper hole on the second or easternmost section drilled. Eight radioactive pegmatite dikes were intersected within an interval of 24 metres. Assays/width ranged from 0.01 per cent uranium oxide (U3O8) (0.2 pound per ton) over 0.11 m to 0.31 per cent U3O8 (6.2 pounds per ton) over 1.52 metres. Average weighted grade of the dikes was 0.09 per cent U3O8 (1.8 pounds per ton) with a cumulative width of 8.9 metres. Anomalous amounts of certain heavy rare earth elements have been noted. In Sample 8027 from DDH H-4, 18 grams per tonne (g/t) scandium was reported along with 0.10 per cent U3O8 (two pounds per ton) across an interval of 1.31 metres.
Details of the results include:
* First round of drilling on Halo confirms historical results by intercepting average grade of 0.09 per cent (1.6 pounds) U3O8 over 8.9 metres (34 feet), including 0.31 per cent U3O8 (6.2 pounds per ton) over 1.52 metres;
*drill program continues on second of seven other known historical targets;
* drilling continues and trenching program to begin for six other prospects.
We are presently in the exploration stage and we cannot guarantee that a commercially viable mineral deposit, a reserve, exists in the property until further exploration is done and a comprehensive evaluation concludes economic and legal feasibility. There are no native land claims that affect title to the properties. The claims are unencumbered and there are no competitive conditions which affect them. Further, we have no insurance covering the claims. We believe that no insurance is necessary since the claims are unimproved and contain no buildings or improvements. Going forward, we will try to interest other companies in the properties if mineralization is found, as we may not have the resources to develop them ourselves.
Proceeds Raised through Sale of Shares
The Company has authorized 200,000,000 common shares with a par value of $0.001 per share. On July 10, 2004 the Company issued 56,000,000 common shares at $0.000125 per share to the sole director and President of the Company for net cash proceeds of $7,000 to the Company. On September 23, 2004 the Company issued 1,760,000 common shares to several investors at $0.0009375 per share for net cash proceeds of $13,200 to the Company. On October 15, 2004 the Company issued 2,240,000 shares to one investor at $0.0009375 per share for net cash proceeds of $2,100 to the Company. In March and April of 2006, the Company received subscriptions for 3,680,000 shares at $0.00625 per share from twenty-eight individuals for net proceeds to the Company of $23,000. The shares were issued on May 1, 2006. On May 15, 2006 the Company issued 1,680,000 common shares of the Company’s stock to two investors at $0.00625 per share, for net cash proceeds to the Company of $10,500. On August 24, 2006, subscriptions were received from two investor for 700,000 shares at $.10 per share for gross proceeds of $70,000.On October 13, 2006, the Company issued 1,050,000 common shares to several investors at prices ranging from $0.10 to $0.25 per share to several investors for net cash proceeds of $175,500. On November 15, 2006, the Company issued 1,725,000 common shares to several investors at $0.10 per share for net cash proceeds of $$157,847. On April 16, 2007, the Company issued 1,410,000 shares of common stock at prices ranging from $0.10 to $1.00 per share for net cash proceeds of $754,359.
The Company's common stock is quoted on the OTC Bulletin Board under the symbol CAUI.OB.
Cash Requirements and Need for Additional Funds
As of April 30, 2007, the current cash on hand was $663,743. Although management believes the Company will be able to raise sufficient funds to maintain its minimal operations and maintain its status as a reporting company for at least the next four months, the Company will be required to raise funds of approximately $1,000,000 within the next four months in order to satisfy the terms of the above described Option Agreements. (See Note 8 to Financial Statements above). If the Company is unable to raise the necessary funds through an offering of its shares it would have to find additional funds either through loans from a financial institution or by its officers. Management cannot provide any assurance that a financial institution would lend money to the Company based upon the fact it has no revenue generating operations. Moreover, there is no agreement or otherwise in place for the officers of the Company to lend funds to the Company at any time.
If the Company is unsuccessful in beginning operations and generating revenue or in the alternative is unsuccessful in obtaining additional funding, it will most likely be unable to continue as a going concern, which would result in the complete loss of any investment made into the Company.
Product Research and Development
The Company does not anticipate any costs or expenses to be incurred for product research and development within the next twelve months.
There were none and there is no anticipated purchase or sale of plant or significant equipment in the next twelve months.
The Company currently has no employees, but is being operated primarily by the current President, Ryan Gibson and the current CFO, David Hayes, who are being compensated as independent contractors. Depending on the ability of the Company to raise sufficient funds, it may hire employees and/or consultants as circumstances may require over the next twelve months.
ITEM 3. CONTROLS AND PROCEDURES.
As of the period covered by this report, Canam carried out an evaluation, under the supervision and with the participation of its management, including David Hayes, Canam’s Chief Financial Officer, of the design and operation of its disclosure controls and procedures. Based on this evaluation, Canam’s Chief Financial Officer concluded that Canam’s disclosure controls and procedures are effective for the gathering, analyzing and disclosing of information that Canam is required to disclose in the reports it files under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), within the time periods specified in the SEC’s rules and forms. There have been no significant changes in Canam’s internal controls or in other factors that could significantly affect the internal controls subsequent to the date of this evaluation. The Company, however, plans to promptly retain the services of a consultant with current and prior experience in disclosure controls and procedures to advise the Company on how to more effectively gather, analyze and disclose information that Canam is required to disclose in the reports it files under the Exchange Act, within the time periods specified in the SEC’s rules and forms.
PART II. OTHER INFORMATION
The Company is not currently subject to any legal proceedings. From time to time, the Company may become subjected to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.
During April 2007, the Company sold 600,000 shares of common stock, to one purchaser, at a purchase price of $1.00 per share, for aggregate proceeds of $600,000. The offering was made pursuant to Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act of 1933, as amended (the “Securities Act”). The shares were offered to a non-US person, in an offshore offering not involving any directed selling efforts in the US.
During April 2007, the Company sold 485,000 shares of common stock, to several purchasers, at a purchase price of $0.25 per share, for aggregate proceeds of $121,250. The offering was made pursuant to Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act. The shares were offered to non-US persons, in an offshore offering not involving any directed selling efforts in the US.
During April 2007, the Company sold 325,000 shares of common stock, to several purchasers, at a purchase price of $0.10 per share, for aggregate proceeds of $32,500. The offering was made pursuant to Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act. The shares were offered to non-US persons, in an offshore offering not involving any directed selling efforts in the US.
During April 2007, the Company issued 260,000 shares of common stock, to Michael Hitch, a director of the Company, in exchange for services to the Company in connection with Mr. Hitch being a director of, and geological advisor to, the Company. The offering was made pursuant to Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act of 1933. The shares were offered to a non-US person, in an offshore offering not involving any directed selling efforts in the US.
During April 2007, the Company issued 250,000 shares of common stock to one purchaser as a finder’s fee in connection with the Company selling a convertible debenture in the amount of $370,000 in March 2007. The sale was made in a private transaction not involving a public offering under the exemption from registration provided by Section 4(2) of the Securities Act.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
None.
ITEM 5. OTHER INFORMATION.
On May 1, 2007, the Company advanced $495,652 to G. Santos Exploration as a deposit for services for an aerial electromagnetic survey of the Wheeler Beckett claims in the Athabasca Basin in Saskatchewan, Canada. This survey will be completed during the summer of 2007.
On May 25, 2007 the Company borrowed $200,000 from Confederated Capital Corp. to meet financial commitments on the Bancroft project. The terms of the loan require it to be repaid with 10% interest on or before July 25, 2007. Also on May 25, 2007, the Company received notice from Advantage Systems Enterprises (“Advantage”) that Advantage would not bring forward the exercise date of its option to acquire 666,667 shares at $1.50 due to a weakening in the market price for the Company’s common stock. The option is due to expire on January 1, 2008.
On May 28, 2007, the Company entered into an option agreement to acquire the right to explore for and develop mineralized material on the Don McCarthy claim in the Athabasca basin area of Saskatchewan, Canada from Geomode Mineral Exploration Ltd. To earn a 100% interest in the Don McCarthy claim, CanAm is required to pay an aggregate of $400,000 and issue 3,000,000 shares of common stock to the vendor over the course of three years. First year commitments require the Company to issue 2,000,000 shares of common stock and pay $100,000, of which $50,000 is due upon closing (and has been paid by the Company) and $50,000 is to be paid on or before December 22, 2007. The balance of commitments calls for the payment of $100,000 and 500,000 shares of common stock on or before May 25, 2008, and the payment of $200,000 and 500,000 shares on or before May 25th, 2009. A one percent (1%) net smelter royalty has been reserved in favor of the vendor, which can be purchased by CanAm for $3,000,000.
On June 1 2007, the Company entered an Option Agreement to acquire the right to explore for and develop mineralized material the Reilly Uranium Property in the Sault St. Marie district of Ontario, Canada from Rubicon Minerals Corp. To exercise its option, CanAm is obligated to issue an aggregate of 80,000 shares of common stock and approximately $103,400. The underlying vendor shall retain a 2% net smelter royalty, half of which can be repurchased by the Company for $1,000,000 and the first right of refusal for the remaining 1%. The payment schedule is as follows: An initial payment of $30,000 on execution of the Option Agreement, an additional $10,000 on the first anniversary date of the Option Agreement, an additional $15,000 on the second anniversary date of the Option Agreement; an additional $20,000 on the third anniversary date of the Option Agreement; and, a final payment of an additional $35,000 on the fourth anniversary date of the Option Agreement. The issuance of the 80,000 shares of common stock must be made according to the following schedule: 20,000 shares within 10 days of the execution of the Option Agreement; 20,000 shares on the first anniversary date of the Option Agreement; 20,000 shares on the second anniversary date of the Option Agreement; and, 20,000 shares on the third anniversary date of the Option Agreement.
ITEM 6. EXHIBITS.
| Exhibit Number | | Description |
| 3.1.1 | | Articles of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| | | |
| 3.1.2 | | Certificate of Amendment to Articles of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| | | |
| 3.1.3 | | Certificate of Change (incorporated by reference to the Company’s Annual Report on Form 10-KSB, filed on February 13, 2007). |
| | | |
| 3.1.4 | | Certificate of Amendment to Articles of Incorporation of the Company (incorporated by reference to the Company’s Annual Report on Form 10-KSB, filed on February 13, 2007). |
| | | |
| 3.2.1 | | Bylaws of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| | | |
| 31.1 | | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 31.2 | | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 32.1 | | Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 32.2 | | Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | |
| | Canam Uranium Corp. (Name of Registrant) |
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| Date: July 23, 2007 | By: | /s/ Ryan Gibson |
| | |
| | President and Chief Executive Officer |
EXHIBIT INDEX
| Exhibit Number | | Description |
| 3.1.5 | | Articles of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| | | |
| 3.1.6 | | Certificate of Amendment to Articles of Incorporation of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| | | |
| 3.1.7 | | Certificate of Change (incorporated by reference to the Company’s Annual Report on Form 10-KSB, filed on February 13, 2007). |
| | | |
| 3.1.8 | | Certificate of Amendment to Articles of Incorporation of the Company (incorporated by reference to the Company’s Annual Report on Form 10-KSB, filed on February 13, 2007). |
| | | |
| 3.2.2 | | Bylaws of the Company (incorporated by reference to the Company’s Registration Statement on Form SB-2, filed on December 17, 2004). |
| 31.1 | | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 31.2 | | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 32.1 | | Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 32.2 | | Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
