We have made the disclosure by modifying footnotes to furnish the suggested information.
We have modified the disclosure in footnote 4 to provide the requested information.
We discussed this comment with the Staff geologist and Staff accounting reviewer. Following those discussions, we believe that the Staff agrees that the Registrant is authorized to present its proved and probable reserves in the Registration Statement, notwithstanding that it may not meet all of the conditions to do so set forth in Industry Guide 7. This result is permitted because the Registrant has previously filed a “43-101 Report” disclosing these reserves in Canada
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and reported the reserves in filings there. |
The minor modifications made to the referenced footnote are intended to clarify that the Company is proceeding to make a final determination as to the feasibility of commercialization of the Nkamouna deposits, and that once final feasibility is determined and a mine plan established, development costs therefore will be capitalized. We understand that the Staff concurs with this position.
| Foreign Currency Translation, page F-9 |
| 16. | We note your response to prior comment 35, explaining that while various items undergo translation, including assets and liabilities denominated in foreign currencies at the balance sheet dates, and transaction amounts denominated in foreign currencies on the transaction dates, the resulting gains and losses are included in operations. |
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| | Since you assert that your functional currency is also your reporting currency, reporting the gains and losses in operations appears to be the proper approach. However, the term translation is imprecise, and not applicable to your situation. The guidance in paragraph 13 of SFAS 52 clarifies that translation adjustments result when translating an entities financial statements into the reporting currency, whereas the functional currency is not the reporting currency. The guidance in paragraph 10 similarly clarifies that if the functional currency is the reporting currency, remeasurement obviates translation. |
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| | The accounting guidance for foreign currency transactions (i.e. transactions denominated in a currency other than the functional currency) is set forth in paragraph 16, and requires measurement on the transaction date, and remeasurcment for unsettled accounts on the balance sheet dates, in the functional currency using the current exchange rate. |
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Prior comment #35 from SEC Comment Letter dated June 11, 2007, “We note your policy on foreign currency translation. Please clarify your functional currency and whether you have any foreign currency transactions requiring remeasurement, as discussed in paragraphs 10 and 15 of SFAS 52.”
The foreign currency translation disclosure on page F-9 has been modified to clarify our accounting policy relating to foreign currency translation as follows [underlined words were added]:
“The Company and its subsidiaries, all of which are considered to be integrated, use the United States Dollar as their functional currency. The Company accounts for foreign currency transactions in accordance with SFAS No. 52, “Foreign Currency Translation.” Current assets and liabilities, as well as long-term monetary assets and liabilities denominated in foreign currencies are translated into the currency of measurement at the rates of exchange prevailing on the balance sheet date. Other consolidated balance sheet items are translated into the currency of measurement at the
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rate prevailing on the respective transaction dates. Transaction amounts denominated in foreign currencies are translated into U.S. dollars at exchange rates prevailing at the transaction dates. The resulting foreign exchange gains and losses are included in operations. As of December 31, 2006, the Company had no foreign currency transactions requiring remeasurement as defined in SFAS 52 paragraphs 10 and 15.”
| Note 3 -- Reverse Acquisition, page F-10 |
| 17. | We see that in response to prior comment 37, you added disclosure on page F-14 stating that "All issued and outstanding common stock of Resource equity were effectively eliminated in the transaction." Since you identify Resource Equity Ltd. as the legal acquirer (accounting target) in your reverse merger, the entity issuing the shares necessary to complete the transaction, it is unclear how stating that all of its outstanding shares have been eliminated is consistent with the event that you describe. Please further revise to clarify. We reissue prior comment 37. |
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Prior comment #37 from SEC Comment Letter dated June 11, 2007, “We note your disclosure indicating that you exchanged 1 million “post transaction” shares for the 1 million shares of Resource Equity Ltd. that were outstanding, presumably immediately before the merger. Given your disclosure characterising the event as an RTO, indicating this entity issued the shares in exchange for the GeoCam interest, it is unclear how shares of this entity subsequent to the transaction are any different than the shares before. Please revise your disclosure to clarify.”
We have clarified the above description as follows [underlined words were added]:
“As part of this RTO, Target Co changed its name to Geovic Mining Corp. (“Geovic Mining”), and Geovic became a wholly owned subsidiary corporation of Geovic Mining.
On November 30, 2006, the Company completed a recapitalization and reverse stock split transaction resulting in reduction of issued and outstanding shares of Resource Equity Ltd. (“Resource”) from 2,344,000 common shares into 1,000,000 common shares.
On December 1, 2006, all of the 1,000,000 outstanding common shares of Resource were exchanged for the issuance of a like number of common shares of Geovic Mining. The ratio of exchange was one common share of Geovic Mining issued for each common share of Resource stock.
For accounting purposes, this transaction has been treated as a reverse acquisition of Resource by Geovic Mining. The historical statements of operations presented herein include only those of Geovic Mining (the accounting acquirer) and only the deficit of the accounting acquirer carries over consistent with the requirements of reverse acquisition
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accounting. As the former shareholders of Resource held approximately 1% of the Company following the transaction, the transaction constituted an RTO.
Prior to December 1, 2006, Resource was a public company based in Toronto and listed on the TSX Venture Exchange, the shares of which were suspended from trading between August 6, 2006 and December 1, 2006 and Geovic was a private mining exploration company based in Colorado.”
Note 8 -- Commitments and Contingencies, page F-20
| 18. | We note your response to prior comment 38 clarifying the treatment of the surface taxes assessed by the Minister of Industry, Mines and Technological Development of the Republic of Cameroon. You state "Approximately 90% (CFA265,194,200) relating to disputed penalties and CFA52,500,000 relating to the disputed surface area subject to tax remain unpaid to the Cameroon tax authority as at December 31, 2006," as you have "deemed the chance" of payment to be remote. Please include the U.S. dollar equivalent, since this is your reporting currency . |
As suggested, we have included the U.S. dollar equivalent information in the referenced footnote.
| 19. | We note your response to prior comment 39, indicating the cautionary note prescribed was added to your website. However, we do not see this language within the disclaimer section or on the website. We reissue prior comment 39. |
The Registrant has included the referenced cautionary note on its website since June 2007. However, in response to this comment, it has now added the same cautionary language within the disclaimer section on the website so that the language now appears in [three] places on the website.
We enclose with this filing a letter from the Registrant acknowledging the matters requested and specified in the Staff’s comment letter, whereby the Registrant acknowledges, among other things, that it is responsible for the adequacy and accuracy of the disclosure in the amended Form 10.
Consistent with our previous procedure, we will submit a fully marked copy of Amendment No. 2 to the registration statement showing all changes from Amendment No. 1. We will send this by e-mail on the day after the filing is made.
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Please contact the undersigned with any questions regarding this filing or any related matter.
Sincerely,
ALAN W. PERYAM, LLC
Alan W. Peryam
| cc: | Geovic Mining Corp. |
| | Ernest & Young LLP |
