JEFFREY G. KLEIN, P.A.
2600 North Military Trail, Suite 270
Boca Raton, Florida 33431
Telephone: (561)997-9920 | Telefax: (561)241-4943 |
October 27, 2008
U.S. Securities and Exchange Commission
Division of Corporation Finance
100 F Street, N.E.
Washington, D. C. 20549
Attention:
Re:
Paramount Gold and Silver Corp. (the “Company”)
Amendment No, 2 to the Registration Statement on Form S-3
File No. 333-153104
Filed: October 8, 2008
Form 10-k for the fiscal year ended June 30, 2008
File No. 1-33630
Filed September 25, 2008
Preliminary Proxy Statement on Schedule 14A
File No. 1-33630
Filed October 3, 2008
Dear Sir/Madam:
The following responses are filed in connection with the Commission’s comment letter dated October 21, 2008.
1. With respect to comment No. 1 with respect to the Company’s designation as a non-accelerated filer for the year ended June 30, 2008, we provide the following calculation:
Total number of issued and outstanding shares as of 12/31/08 |
|
(the last day of the Company’s second quarter) | 47,695,997 |
| 47,695,997 |
Closing Bid price of Common Stock on 12/31/08 | $2.05 |
Market Capitalization: | $97,776,793 |
With a market capitalization of $97,776,793, the threshold for designation as an accelerated filer being $75 million, the minimum market valuation for shares held by affiliates must be $22,776,793.
As of 12/31/08, our affiliates owned the following number of shares of common stock:
Name (officers and directors)
Christopher Crupi | 3,623,900 |
William Reed | 460,000 |
Lucie Letellier | 141,260 |
Daniel Hachey | 150,000 |
John Carden | 45,000 |
|
|
Total: | 4,420,160 |
Total held by affiliated shareholders: (1)
Libra Fund Lp | 1,904,000 |
Libra Fund Offshore | 477,000 |
Sprott Asset Management | 2,428,000 |
Mackenzie Financial Corp. | 1,000,000 |
Sentry Select Precious Metals Mining | 865,000 |
Sentry Select Precious Metals Growth | 135,000 |
Anima | 1,000,000 |
|
|
Total: | 7,809,000 |
Total shares held by officers directors and affiliates: 12,229,160
Total market capitalization of shares held by affiliates: 12,229,160 X $2.05 = $25,069,778
Total market capitalization: | $97,776,793 |
<Affiliated Market valuation> | 25,069,778 |
|
|
Public Float | $72,707,015 |
1. These shareholders invested in the Company’s financings throughout 2007 and were kept abreast on a regular basis regarding the Company’s operations, drilling results, financing activities. Because of their substantial investment management met with these institutional investors throughout calendar year 2007, they were invited to board meetings and provided with information during 2007 generally available only to the Company’s Board of Directors. Beginning in calendar year 2008, management began to look for other institutional investors. These shareholders then relied on information otherwise available through our filings with the Commission and press releases.
2. With respect to comment No. 2 regarding disclosures with respect to officer and director compensation, related party transactions, director independence, plan based compensation and corporate governance matters as set forth in Release No. 33-8732A please be advised:
We have made significant changes to the Schedule 14(A) both in substance and in form in order to comply with the applicable disclosure requirements. By way of example only, some of the more substantive changes that we have made include the following:
The following table sets forth the compensation paid to non employee directors for the periods indicated.
Name and |
| Fiscal Year |
| Salary |
| Bonus Stock Awards |
| Option Awards |
| Non equity Incentive Plan Comp |
| Non qualified All other Deferred Comp |
| TOTAL |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ian Talbot |
| 2008 |
|
|
| 108,900 |
| 273,000 |
|
|
|
|
| $381,900 |
|
| 2007 |
| -0- |
|
|
|
|
|
|
|
|
| -0- |
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michel Yvan Stinglhamber |
| 2008 |
| 24,000 |
| 87,500 |
| 49,000 |
|
|
|
|
| $160,500 |
|
| 2007 |
| 4,000 |
|
|
| 158,050 |
|
|
|
|
| 162,050 |
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Daniel Hachey |
| 2008 |
|
|
| 87,500 |
| 252,000 |
|
|
|
|
| $ 339,500 |
|
| 2007 |
| 870,000 |
| 210,000 |
| 442,000 |
|
|
|
|
| 1,522,000 |
|
| 2006 |
|
|
|
|
|
|
|
|
|
|
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John Carden |
| 2008 |
|
|
| 99,000 |
| 252,000 |
|
|
|
|
| $351,000 |
|
| 2007 |
|
|
| 102,101 |
|
|
|
|
|
|
| 102,101 |
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert Dinning |
| 2008 |
|
|
|
|
| 14,000 |
|
|
|
|
| $ 14,000 |
|
| 2007 |
|
|
|
|
|
|
|
|
|
|
| -0- |
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
| -0- |
See page 10.
We have provided the following table with respect to outstanding options issued to our directors:
Name |
| No. |
| Expiration Date |
| Exercise Price |
| |
John Carden |
| 180,000 |
| 8/22/12 |
| $ | 2.42 |
|
Daniel Hachey |
| 180,000 |
| 8/22/12 |
| $ | 2.42 |
|
Daniel Hachey |
| 200,000 |
| 11/30/11 |
| $ | 2.17 |
|
Daniel Hachey |
| 100,000 |
| 1/4/12 |
| $ | 2.37 |
|
Ian Talbot |
| 195,000 |
| 8/22/12 |
| $ | 2.42 |
|
Michel Stinglhamber |
| 180,000 |
| 8/22/12 |
| $ | 2.42 |
|
Robert Dinning |
| 50,000 |
| 8/22/12 |
| $ | 2.25 |
|
See page 11.
With respect to stock grants issued to our non employee directors we have provided the following information
|
|
|
| No. of Shares of Common Stock |
|
Name |
|
|
| Issued to Directors |
|
|
|
|
|
|
|
Ian Talbot |
| 2008 |
| 55,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Daniel Hachey |
| 2008 |
| 50,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
John Carden |
| 2008 |
| 50,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Michel Stinglhamber |
| 2008 |
| 50,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert Dinning |
| 2008 |
| -0- |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
See page 11.
A more detailed disclosure regarding our directors is included under the heading “The Board, its committees and its compensation” beginning on page 10.
As to our officers, and our employee directors, we have provided the following information:
We have provided the following information with respect to our officers:
Name and |
| Fiscal Year |
| Salary |
| Bonus Stock Awards |
| Option Awards |
| Non equity Incentive Plan Comp |
| Non qualified All other Deferred Comp (1) |
| TOTAL |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Christopher |
| 2008 |
| 156,000 |
| 792,000 |
| 560,000 |
|
|
|
|
| $1,508,000 |
Crupi, |
| 2007 |
| 39,000 |
| 35,000 |
| 552,000 |
|
|
|
|
| 626,000 |
Pres/CEO/Dir |
| 2006 |
| -0- |
| 630,000 |
|
|
|
|
|
|
| 630,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lucie Letellier |
| 2008 |
| 125,000 |
|
|
| 210,000 |
|
|
|
|
| $235,000 |
C/F/O |
| 2007 |
| 82,600 |
| 112,500 |
|
|
|
|
|
|
| 195,100 |
|
| 2006 |
| 26,000 |
|
|
|
|
|
|
|
|
| 26,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael Clancy |
| 2008 |
|
|
|
|
| 105,000 |
|
|
|
|
| $105,000 |
Secretary |
| 2007 |
|
|
|
|
|
|
|
|
|
|
| -0- |
|
| 2006 |
|
|
|
|
|
|
|
|
|
|
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William Reed |
| 2008 |
| 166,000 |
|
|
| 79,200 |
| 56,000 |
|
|
| $301,200 |
V/P |
| 2007 |
| 63,750 |
| 35,000 |
|
|
| 552,000 |
|
|
| 650,750 |
|
| 2006 |
| 62,641 |
|
|
| 562,500 |
|
|
|
|
| 625,141 |
See page 17.
With respect to stock grants issued to our officers and employee directors, we have provided the following table:
|
|
|
| No. of Shares of Common Stock |
|
Name |
|
|
| Issued to Officers |
|
|
|
|
|
|
|
Christopher Crupi |
| 2008 |
| 400,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| 300,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
William Reed |
| 2008 |
| 40,000 |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| 250,000 |
|
|
|
|
|
|
|
Lucie Letellier |
| 2008 |
| -0- |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael Clancy |
| 2008 |
| -0- |
|
|
| 2007 |
| -0- |
|
|
| 2006 |
| -0- |
|
See page 18.
With respect to options issued to our officers and employee directors we have provided the following information:
As of June 30, 2008 each of our officers has been granted the following options
Name |
| Number |
| Expiration date |
| Exercise Price |
| |
|
|
|
|
|
|
|
|
|
William Reed |
| 400,000 |
| 8/22/12 |
| $ | 2.42 |
|
William Reed |
| 400,000 |
| 10/31/11 |
| $ | 2.06 |
|
Christopher Crupi |
| 400,000 |
| 8/22/12 |
| $ | 2.42 |
|
Christopher Crupi |
| 400,000 |
| 10/31/11 |
| $ | 2.06 |
|
Michal Clancy |
| 75,000 |
| 8/22/12 |
| $ | 2.42 |
|
Lucie Letellier |
| 150,000 |
| 8/22/12 |
| $ | 2.42 |
|
See page 18.
A more detailed disclosure regarding our officers is included under the heading “Compensation of our Officers” beginning on page 17.
With respect to matters regarding our corporate governance, we have provided significantly enhanced disclosure with respect to the committees of our Board of Directors, the responsibilities of each committee as well as disclosing the number of committee and board meetings. We have also included the reports as prepared by the audit, compensation and nominating committees.
(See pages: 12 through 15)
With respect to our discussion regarding the manner in which the Company addresses related party transactions, we have included the following:
It is our practice and policy to comply with all applicable laws, rules and regulations regarding related party transactions, including the Sarbanes-Oxley Act of 2002. A related person is any executive officer, director, or more than 5% shareholder of the Company, including any of their immediate family members, and any entity owned or controlled by such persons. Our audit committee has been charged with responsibility for approving all related party transactions as part of the audit committee’s overall responsibilities as set forth in its charter. In considering related party transactions, the Audit Committee takes into account the relevant available facts and circumstances. In the event a director has an interest in the proposed transaction, the director must recuse himself from the deliberations and approval.
(See disclosure on page 19)
3.With respect to comment no. 3 regarding amending the terms of outstanding options:
We have made significant changes throughout the Schedule 14(a) to comply with Item 201(d) of Regulation S-K as well as Item 10(c) of Schedule 14(a). Several of these changes have been incorporated in our response to question number 2 and are addressed throughout the proxy. We have also changed the proxy to reflect that the new exercise price will be equal to the greater of $.50 per share or the fair market value on the date In addition, we have provided the following chart to reflect outstanding option grants to officers and directors:
|
| Price |
| Current Exercise |
| New Exercise Price |
| Date |
| ||
|
|
|
|
|
|
|
|
|
|
|
|
Christopher Crupi |
| 400,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Lucie Letellier |
| 150,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
William Reed |
| 400,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Daniel Hachey |
| 180,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Daniel Hachey |
| 200,000 |
| $ | 2.17 |
| $ | 0.50 |
| 11/30/11 |
|
Daniel Hachey |
| 100,000 |
| $ | 2.37 |
| $ | 0.50 |
| 1/24/11 |
|
John Carden |
| 180,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Ian Talbot |
| 195,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Michael Clancy |
| 75,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Robert Dinning |
| 50,000 |
| $ | 2.25 |
| $ | 0.50 |
| 8/22/12 |
|
Michel Stinglhamber |
| 180,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
(All officers as |
|
|
|
|
|
|
|
|
|
|
|
a group 4) |
| 1,025,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
(Non Officer |
|
|
|
|
|
|
|
|
|
|
|
Directors as a |
|
|
|
|
|
|
|
|
|
|
|
Group(5) |
| 1,085,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
(All officers and |
|
|
|
|
|
|
|
|
|
|
|
Directors) |
| 2,110,000 |
| $ | 2.42 |
| $ | 0.50 |
| 8/22/12 |
|
Non Executive |
|
|
|
|
|
|
|
|
|
|
|
Officer Employee |
|
|
|
|
|
|
|
|
|
|
|
Group |
| 1,439,500* |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
| 3,549,500 |
|
|
|
|
|
|
|
|
|
See page 31.
Paramount Gold and Silver Corp. hereby acknowledges that (i) it is responsible for the adequacy and accuracy of the disclosure in the filings referenced above, (ii) staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filings; and (iii) it may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Should you have further questions, please do not hesitate to contact the undersigned.
| Very truly yours, |
|
|
|
|
|
/s/ JEFFREYG. KLEIN |
| Jeffrey G. Klein Counsel For Paramount Gold and Silver Corp. |
|
