Dominion Minerals (DMNM) 10-Q/A 2008 Q3 Quarterly report (amended)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549 

AMENDMENT NO. 1

TO

FORM 10-Q 

_________________

(Mark One) 

þ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended September 30, 2008

or 

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period from to  

Commission File Number 000-52696

DOMINION MINERALS CORP.

(Exact name of registrant as specified in its charter)

Delaware	22-3091075
(State or Other Jurisdiction of	(I.R.S. Employer Identification No.)
Incorporation or Organization)

410 Park Avenue, 15th Floor

New York, New York 10019

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (212) 231-8171

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 preceding 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. Yes þ No o 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨	Accelerated filer  ¨
Non-accelerated filer  ¨	Smaller reporting company  x
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ¨    No  þ 

The number of shares of the registrant’s common stock outstanding as of November 14, 2008 was 72,903,084.

AMENDMENT TO FORM 10-Q

This Amendment No. 1 to Form 10-Q (this "Amendment") amends our quarterly report on Form 10-Q for the quarter ended September 30, 2008 as filed with the Securities and Exchange Commission on November 17, 2008.

As described in Note 3 to the Company’s financial statements included herein, the Company has restated its financial statements as of and for the quarter ended September 30, 2008, to revise the accounting for common stock issued in connection with the conversion on April 1, 2007 of a promissory note previously issued by the Company and services that the Company expected to receive from the holders of the promissory note.  As described in Note 3, the Company filed suit on December 23, 2008 in an effort to recover the shares of common stock issued and reached a settlement agreement on February 11, 2009, under which a portion of the shares issued were cancelled or returned to the Company.  The Company has re-stated its accounting for the issuance of the shares and has recorded a non-cash charge to income of $2,205,492 in the quarter ended June 30, 2007 related to the shares that will not be returned to the Company and for which the Company will not receive the services it expected.

The restatement of the Company’s financial statements, as described in Note 3, had no effect on the Company’s net income for the three months ended September 30, 2008 and the three months ended September 30, 2007.  Also, the restatement had no effect on the Company’s net income for the nine months ended September 30, 2008 and it reduced the amount of net income by $2,205,492, for the nine months ended September 30, 2007.  The restatement reduced the total amount of Shareholders’ Equity by $3,230 and increased Current Liabilities by $3,230, as of September 30, 2008 and September 30, 2007.  Except for these effects, the inclusion of Note 3, the related revisions to Note 1, paragraph (h), Note 2, Note 6, paragraph (a), Note 8, paragraph (e), Note 9 and the revisions in Part I, Item 2, Management discussion and analysis, this Amendment No. 1 and the Company’s financial statements included herein are unchanged from the Report previously filed.

This Amendment contains the complete text of the original report with the corrected information appearing in the financial statements and in Part I, Item 2, Management discussion and analysis.

DOMINION MINERALS CORP. AND SUBSIDIARIES
(FORMERLY EMPIRE MINERALS CORP.)
(AN EXPLORATION COMPANY)
CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 2008 AND DECEMBER 31, 2007
ASSETS
	SEPTEMBER 30,			DECEMBER 31,
	2008			2007
	(UNAUDITED)
	(Restated)			(Restated)
CURRENT ASSETS:
Cash and cash equivalents	$	5,618,639		$	878,116
Prepaid expense		37,534			69,521
Total current assets		5,656,173			947,637
PROPERTY AND EQUIPMENT, net		27,733			40,717
OTHER ASSETS:
Notes issuance cost, net		-			303,615
Other assets		21,000			-
Long term investment		6,207,862			2,720,279
Total other assets		6,228,862			3,023,894
Total assets	$	11,912,768		$	4,012,248
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accrued liabilities	$	474,996		$	529,534
Short-term loan		76,156			-
Convertible note payable		-			300,000
Liquidated damages payable		250,050			-
Total current liabilities		801,202			829,534
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $0.0001 par value; 5,000,000 shares authorized;
100 and 100 shares issued and outstanding as of		-			-
September 30, 2008 and December 31, 2007, respectively
Common stock, $0.0001 par value; 700,000,000 shares authorized
72,902,928 and 42,605,696 issued and outstanding as of		7,290			4,261
September 30, 2008 and December 31, 2007, respectively
Escrowed common stock		(134	)		(267	)
Additional paid-in capital		29,662,754			14,926,809
Shares to be returned for services not received		(1,654,167	)		(1,654,167	)
Stock subscription receivable		(1,560	)		(1,560	)
Deficit accumulated during the exploration  stage		(16,961,208	)		(10,117,528	)
Accumulated other comprehensive income		58,591			25,166
Total shareholders' equity		11,111,566			3,182,714
Total liabilities and shareholders' equity	$	11,912,768		$	4,012,248

The accompanying notes are an integral part of these consolidated financial statement.

-1-

CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007
AND FROM INCEPTION (MARCH 1, 2006) TO SEPTEMBER 30, 2008
(UNAUDITED)
													From inception
	Three months ended						Nine months ended						(March 1, 2006)
	September 30,						September 30,						to September 30,
	2008			2007			2008			2007			2008
										(Restated)			(Restated)
REVENUE	$	-		$	-		$	-		$	-		$	-
COST OF SALES		-			-			-			-			-
GROSS PROFIT		-			-			-			-			-
RESEARCH AND DEVELOPMENT COSTS		16,495			48,140			120,831			323,875			901,183
GENERAL AND  ADMINISTRATIVE EXPENSES		1,727,521			903,525			5,860,570			3,448,936			12,908,703
LOSS FROM EXPECTED SERVICES NOT RECEIVED		-			-			-			2,205,492			2,205,492
LIQUIDATED DAMAGE EXPENSE		69,600			-			265,650			-			265,650
LOSS FROM OPERATIONS		(1,813,616	)		(951,665	)		(6,247,051	)		(5,978,303	)		(16,281,028	)
OTHER (EXPENSE) INCOME
Non-operating income (expense), net		-			73			(25,000	)		10,190			(25,000	)
Interest expense, net		(26,785	)		10,064			(143,014	)		14,418			(226,565	)
Finance expense		(29,526	)		(82,695	)		(428,615	)		(82,695	)		(428,615	)
Total other (expense) income, net		(56,311	)		(72,558	)		(596,629	)		(58,087	)		(680,180	)
LOSS BEFORE PROVISION FOR INCOME TAXES		(1,869,927	)		(1,024,223	)		(6,843,680	)		(6,036,390	)		(16,961,208	)
PROVISION FOR INCOME TAXES		-			-			-			-			-
NET LOSS		(1,869,927	)		(1,024,223	)		(6,843,680	)		(6,036,390	)		(16,961,208	)
OTHER COMPREHENSIVE INCOME
Foreign currency translation adjustment		2,092			2,687			33,425			8,100			58,591
COMPREHENSIVE LOSS	$	(1,867,835	)	$	(1,021,536	)	$	(6,810,255	)	$	(6,028,290	)	$	(16,902,617	)
LOSS PER SHARE
Basic and diluted loss per share	$	(0.03	)	$	(0.03	)	$	(0.13	)	$	(0.18	)
Basic and diluted weighted average shares outstanding		67,717,019			40,029,773			52,270,826			33,478,825

The accompanying notes are an integral part of these consolidated financial statement.

-2-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

																						SHARES TO BE						ACCUMU-LATED
	PREFERRED STOCK					COMMON STOCK				ESCROWED COMMON STOCK						ADDITIONAL PAID-IN			STOCK SUBSCRIP-TION			RETURNED FOR SERVICES NOT			ACCUMU-LATED			OTHER COMPRE-HENSIVE INCOME			TOTAL SHARE-HOLDERS'
	SHARES			PAR		SHARES		PAR		SHARES			PAR			CAPITAL			RECEIVABLE			RECEIVED			DEFICIT			(LOSS)			EQUITY
Balance at inception, March 1, 2006		-		$	-		-	$	-		-		$	-		$	-		$	-					$	-		$	-		$	-
Founders stock issued for cash, $0.001 per share							6,460,000		646								5,814			(3,060	)											3,400
Shares issued March 29, 2006 for $76,500 in servicesand $8,500 cash, at $0.01 per share							8,500,000		850								84,150															85,000
Stock sold through subscription agreements April through December 2006 at $0.50 per share							5,505,000		551								2,751,949															2,752,500
Stock issued through the exercise of warrants							20,000		2								1,998															2,000
Stock warrants issued to employees																	474															474
Stock warrants issued to consultants for advisory services																	197,113															197,113
Foreign currency translation loss																													(2,651	)		(2,651	)
Net loss																										(2,123,672	)					(2,123,672	)
Balance, December 31, 2006		-		$	-		20,485,000	$	2,049		-		$	-		$	3,041,498		$	(3,060	)	$	-		$	(2,123,672	)	$	(2,651	)	$	914,164
Stock issued
$0.10 per share, conversion of warrants for cash							450,000		45								44,955															45,000
$0.10 per share, cashless conversion of warrants							1,600,000		160								(160	)														-
$0.50 per share, CEO for compensation							1,500,000		150								749,850															750,000
$0.50 per share, for cash							1,994,000		199								996,801			(210,000	)											787,000
$0.50 per share, for consulting services							1,475,000		148								737,352															737,500
$0.50 per share, for investment in Cuprum							4,000,000		400		(2,666,667	)		(267	)		666,533															666,666
$0.50 per share, for conversion of notes							100,000		10								49,990															50,000
$0.50 per share, for services and conversion of note							7,925,000		793								3,961,707						(1,654,167	)								2,308,333
Shares assumed pursuant to reverse merger		100					232,696		23								(135,230	)														(135,207	)
Repurchase preferred stock		(100	)														(10,000	)														(10,000	)
Warrants issued with convertible note																	14,276															14,276
Proceeds on subscription receivable																				200												200
Foreign currency translation gain																													5,413			5,413
Net loss																										(5,012,167	)					(5,012,167	)
Balance, June 30, 2007, unaudited, Restated		-			-		39,761,696		3,977		(2,666,667	)		(267	)		10,117,572			(212,860	)		(1,654,167	)		(7,135,839	)		2,762			1,121,178
Proceeds on subscription receivable																				1,300												1,300
Stock issued
$0.50 per share, for cash							1,320,000		132								659,868			210,000												870,000
$0.50 per share, for consulting services							824,000		82								411,918															412,000
$0.50 per share, for loan issuance cost							700,000		70								349,930															350,000
Warrants issued with convertible note																	53,151															53,151
Special warrants issued
Issued for cash																	2,230,000															2,230,000
Issued with convertible promissory note																	500,000															500,000
Preferred stock issued for compensation expense		100			-												10,000															10,000
Stock compensation expense																	594,370															594,370
Foreign currency translation gain																													22,404			22,404
Net loss																										(2,981,689	)					(2,981,689	)
Balance, December 31, 2007		100		$	-		42,605,696	$	4,261		(2,666,667	)	$	(267	)	$	14,926,809		$	(1,560	)	$	(1,654,167	)	$	(10,117,528	)	$	25,166		$	3,182,714
Stock issued
$0.46 per share, for cash							21,789,566		2,179								9,771,021															9,773,200
$0.46 per share, for consulting services							650,000		65								298,935															299,000
$0.46 per share, for loan issuance cost							376,000		38								187,962															188,000
Special warrants converted to stock							2,015,000		200								(200	)														-
Release of escrow shares											1,333,334			133			666,534															666,667
Shares issued to extend convertible note							250,000		25								124,975															125,000
Shares issued as employee compensation							5,216,666		522								2,581,144															2,581,666
Special warrants issued Issued for cash																	77,500															77,500
Stock compensation expense																	947,536															947,536
Stock option expense																	50,870															50,870
Warrants issued for services																	29,668															29,668
Foreign currency translation gain																													33,425			33,425
Net loss																										(6,843,680	)					(6,843,680	)
Balance, September 30, 2008, unaudited, Restated		100		$	-		72,902,928	$	7,290		(1,333,333	)	$	(134	)	$	29,662,754		$	(1,560	)	$	(1,654,167	)	$	(16,961,208	)	$	58,591		$	11,111,566

The accompanying notes are an integral part of these consolidated financial statements.

-3-

DOMINION MINERALS CORP. AND SUBSIDIARIES
(FORMERLY EMPIRE MINERALS CORP.)
(AN EXPLORATION COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007 AND FROM INCEPTION (MARCH 1, 2006) TO SEPTEMBER 30, 2008
(UNAUDITED)
								From inception
	Nine months ended							(March 1, 2006)
	September 30,							to September 30,
	2008				2007			2008
					(Restated)			(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(6,843,680	)		$	(6,036,390	)	$	(16,961,208	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation		43,221				7,488			52,568
Bad debt expense		-				-			80,000
Warrants issued for services		29,668				-			227,255
Amortization of debt discount		-				16,671			31,641
Amortization of loan issuance cost		303,615				144,083			509,787
Common stock issued for advisory services		487,000				1,605,479			2,393,479
Loss from write-off of services due from note holders						2,202,262			2,202,262
Stock option expense		998,406				-			1,592,776
Common stock issued for notes		125,000				-			125,000
Common stock issued for employee compensation		2,581,666				-			2,581,666
Preferred stock issued for employee compensation		-				-			10,000
Loss on currency exchange		-				11,080			11,080
Change in operating assets and liabilities:
Prepaid expense		31,987				-			31,987
Other assets		(21,000	)			-			(21,000	)
Accrued liabilities		(54,538	)			(32,320	)		474,996
Liquidated damages payable		265,650				-			265,650
Net cash used in operating activities		(2,053,005	)			(2,081,647	)		(6,392,061	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Equipment purchase		(30,210	)			(4,166	)		(76,698	)
Long term investment		(2,820,915	)			(1,544,189	)		(4,874,529	)
Advances for notes receivable		-				(80,000	)		(80,000	)
Net cash used in investing activities		(2,851,125	)			(1,628,355	)		(5,031,227	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		10,023,200				1,632,000			14,444,600
Proceeds from special warrants		77,500				2,068,920			2,298,420
Proceeds from exercise of warrants		-				45,000			45,000
Payment of note issuance cost		-				(74,000	)		(74,000	)
Payment on notes payables		(2,300,000	)			(25,000	)		(2,625,000	)
Payment on equity transactions		(250,000	)			-			(250,000	)
Proceeds from short term loan		75,868				-			75,868
Proceeds from notes payable		2,000,000				1,105,000			3,105,000
Proceeds from subscription receivable		-				1,500			1,500
Payment to repurchase preferred stock		-				(10,000	)		(10,000	)
Net cash provided by financing activities		9,626,568				4,743,420			17,011,388
EFFECT OF EXCHANGE RATE CHANGES ON CASH		18,085				9,933			30,539
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		4,740,523				1,043,351			5,618,639
CASH AND CASH EQUIVALENTS, beginning of the period		878,116				1,047,877			-
CASH AND CASH EQUIVALENTS, end of period	$	5,618,639			$	2,091,228		$	5,618,639
SUPPLEMENTAL DISCLOSURES:
Interest paid	$	-			$	66,024		$	66,024
Income taxes paid	$	-			$	-		$	-
Net liabilities assumed in reverse acquisition	$	-			$	135,207		$	135,207
Conversion of notes and interest for common stock	$	-		��	$	106,071		$	106,071
Issuance of founders stock for subscription receivable	$	-			$	-		$	14,960
Shares issued for exploration and development of investment	$	666,666			$	666,666		$	1,333,332
Common stock issued to prepay for consulting services	$	-			$	-		$	69,521
Special warrants issued for repayment of convertible promissory note	$	-			$	500,000		$	500,000
Warrants issued for discount on debt	$	-			$	-		$	31,641
Warrants issued for loan issuance costs	$	-			$	31,641		$	35,786
Common stock issued for loan issuance cost	$	240,090			$	100,000		$	446,262

The accompanying notes are an integral part of these consolidated financial statements.

-4-

1.   Nature of Business and Significant Accounting Policies

a.   Nature of business – Dominion Minerals Corp. (“Company”) (formerly Empire Minerals Corp.) was incorporated January 4, 1996, under the laws of the state of Delaware. The Company is engaged in the exploration of precious and base metals including gold and copper.  All potential properties currently under exploration are located in the People’s Republic of China (“PRC” or “China”) and the Republic of Panama (“Panama”).

From September 2005 to November 2007, the Company changed its name 4 times to reflect the changing business plans. The original name of the Company was ObjectSoft Corporation.  In June 2005, the name was changed to Nanergy, Inc. In June 2006, the name was changed to Xacord Corp., in January 2007, the name was changed to Empire Minerals Corp, and in November 2007, the name was changed to its current name, Dominion Minerals Corp.

On February 20, 2007, the Company completed a triangular reverse merger with Empire Minerals Corp., a Nevada Corporation (formerly Empire Gold Corp. and referred to as “Subsidiary”) and Xacord Acquisition Sub Corp, then the Company’s subsidiary (“Xacord”). All 26,504,000 shares in the Subsidiary were exchanged for 26,504,000 shares in the Company. Additionally, 5,950,000 warrants in the Subsidiary were exchanged for 5,950,000 warrants in the Company. The Subsidiary was the accounting acquirer and the Company was the legal acquirer. The transaction was accounted for as a reverse merger and recapitalization. As such, the accompanying consolidated financial statements reflect the historical operations of the Subsidiary in the capital structure of the Company at the beginning of the first period presented herein.

b.   Basis of presentation – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America.  The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries Empire Minerals Corp., 50% owned Zhaoyuan Dongxing Gold Mining Co., Ltd. (“Dongxing”), and 70% owned Empire (Tianjin) Resources Co., Ltd. (“Tianjin”) (together the “Subsidiaries”). All significant inter-company transactions and balances have been eliminated in consolidation.  Minority interest has not been presented on the consolidated balance sheet because accumulated losses have exceeded the minority shareholders’ equity.  In accordance with APB No. 18, The Equity Method of Accounting for Investments in Common Stock, the minority interest has been written down to zero on the accompanying consolidated balance sheet.

Management has included all normal recurring adjustments considered necessary to give a fair presentation of operating results for the periods presented. Interim results are not necessarily indicative of results for a full year. The information included in these interim consolidated financial statements should be read in conjunction with information included in the Company's consolidated financial statements for the year ended December 31, 2007, appearing elsewhere and in the Company's annual report on 10-KSB filed on April 16, 2008.

-5-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

The Company is currently in an exploration stage, which is characterized by significant expenditures for the examination and development of exploration opportunities by its Subsidiaries.  The Subsidiaries' focus for the foreseeable future will continue to be on securing joint venture agreements within PRC and Panama to begin conducting mining operations.

c.   Use of estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  The significant estimates made in the preparation of the Company’s consolidated financial statements relate to the fair value of warrants and stock issued for services as well as various accruals.  For example, the Company calculates the fair value of the options granted based on various assumptions.  Accordingly, the actual results could materially differ from those estimates.

d.   Fair value of financial instruments – On January 1, 2008, the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 157, Fair Value Measurements.  SFAS No. 157 defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosures requirements for fair value measures.  The carrying amounts reported in the accompanying consolidated balance sheet for current assets and current liabilities qualify as financial instruments are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest.  The three levels are defined as follows:

·   Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

·   Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments.

·   Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

The Company invested $6,207,862 to Cuprum Resources Corp. as of September 30, 2008. Since there is no quoted or observable market price for the fair value of similar investments in long term joint ventures, the Company then used the level 3 inputs for its valuation methodology. The determination of the fair value was based on the cost of the capital contributeed to the investment.

As of September 30, 2008, the Company did not identify any other assets or liabilities that are required to be presented on the consolidated balance sheet at fair value in accordance with SFAS No. 157.

-6-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

SFAS No. 159 (“SFAS 159”), The Fair Value Option for Financial Assets and Financial Liabilities—including an amendment of FASB Statement No. 115, became effective for the Company on January 1, 2008. SFAS 159 provides the Company with the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis with the difference between the carrying value before election of the fair value option and the fair value recorded upon election as an adjustment to beginning retained earnings.  The Company chose not to elect the fair value option under SFAS 159.

e.   Cash and cash equivalents – For purposes of the statements of cash flows, the Company defines cash equivalents as all highly liquid debt instruments purchased with original maturities of three months or less.

f.   Advances – From time to time, the Company advances funds to its consultants and business partners to further the Company’s business plans.  Management monitors these advances to ensure appropriate progress is made pursuant to the funding terms.  Additionally, management evaluates the collectibility of these monies and records reserves if collections are in doubt.

g.   Concentration of risk – Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and cash equivalents. The Company maintains cash deposits in financial institutions that exceed the amounts insured by the U.S. government.  Balances at financial institutions or state-owned banks within the PRC are not covered by insurance.  Non-performance by these institutions could expose the Company to losses for amounts in excess of insured balances.   The Company has limited experience as it is an exploration stage company but does not anticipate incurring any losses related to this credit risk.  As of September 30, 2008, the Company’s bank balances exceeded government-insured limits  by $5,426,145.

The Company has gold mining activities in PRC and an investment in copper mining activities in Panama.  Accordingly, the Company’s mining business, financial condition and results of operations may be influenced by the political, economic and legal environments in the PRC and Panama, and by the general state of the PRC’s and Panama’s economy.  The Company’s operations in the PRC and investments in Panama are subject to specific considerations and significant risks not typically associated with companies in the United States. These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange.  The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

h.   Net loss per share – In accordance with SFAS No. 128 (“SFAS 128”), Earnings Per Share, an basic earnings/loss per common share (“EPS”) is computed by dividing net loss for the period by the weighted average number of common shares outstanding during the period.  Under SFAS 128, diluted earnings/loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and dilutive.

-7-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

The following is a reconciliation of the basic and diluted loss per share computations:

Three months ended September 30,	2008		2007
Net loss	$	1,869,927	$	1,024,223
Weighted average shares used in basic computation		67,717,019		40,029,773
Diluted effect of stock options, warrants		-		-
Weighted average shares used in diluted computation		67,717,019		40,029,773
Losses per share:
Basic	$	0.03	$	0.03
Diluted	$	0.03	$	0.03

All warrants and options were excluded from the diluted loss per share due to the anti-diluted effect.

Nine months ended September 30,	2008		2007
			(Restated)
Net loss	$	6,843,680	$	6,036,390
Weighted average shares used in basic computation		52,270,826		33,478,825
Diluted effect of stock options and warrants		-		-
Weighted average shares used in diluted computation		52,270,826		33,478,825
Losses per share:
Basic	$	0.13	$	0.18
Diluted	$	0.13	$	0.18

All warrants and options were excluded from the diluted loss per share due to the anti-dilutive effect.

i.   Income Taxes – The Company provides for income taxes under SFAS No. 109 (“SFAS 109”), Accounting for Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities using the enacted income tax rate expected to apply to taxable income in the period in which the deferred tax assets or liabilities are expected to be settled or realized.  SFAS 109 requires that a valuation allowance be established if necessary, to reduce the deferred tax assets to the amount that management believes is more likely than not to be realized.  The provision for federal income tax differs from that computed amount by applying federal statutory rates to income before federal income tax expense mainly due to expenses that are not deductible and income that is not taxable for federal income taxes, including permanent differences such as non-deductible meals and entertainment.

-8-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

The Company adopted FASB Interpretation 48 (“FIN 48”), Accounting for Uncertainty in Income Taxes, on January 1, 2007. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The adoption had no effect on the Company’s consolidated financial statements.

j.   Stock-based compensation – For stock, options and warrants issued to service providers, employees and founders, the Company follows SFAS No. 123(R), Share-Based Payment, and EITF 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services, which requires recording the options and warrants at the fair value of the service provided and expensing over the related service period.

k.   Recently issued accounting pronouncements

In December 2007, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 160 (“SFAS 160”), Noncontrolling Interests in Consolidated Financial Statements - an amendment of Accounting Research Bulletin No. 51, which establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest and the valuation of retained non-controlling equity investments when a subsidiary is deconsolidated. SFAS 160 also establishes reporting requirements that provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. SFAS 160 is effective for fiscal years beginning after December 15, 2008. The Company has not yet determined the impact that SFAS 160 will have on its consolidated financial statements.

In December 2007, SFAS No. 141(R) (“SFAS 141R”), Business Combinations, was issued. SFAS 141R replaces SFAS No. 141, Business Combinations. SFAS 141R retains the fundamental requirements in SFAS 141 that the acquisition method of accounting (which SFAS 141 called the purchase method) be used for all business combinations and for an acquirer to be identified for each business combination. SFAS 141R requires an acquirer to recognize the assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at the acquisition date, measured at their fair values as of that date, with limited exceptions. This replaces SFAS 141’s cost-allocation process, which required the cost of an acquisition to be allocated to the individual assets acquired and liabilities assumed based on their estimated fair values. SFAS 141R also requires the acquirer in a business combination achieved in stages (sometimes referred to as a step acquisition) to recognize the identifiable assets and liabilities, as well as the noncontrolling interest in the acquiree, at the full amounts of their fair values (or other amounts determined in accordance with SFAS 141R. SFAS 141R applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Early adoption is prohibited. The Company is currently evaluating the impact that adopting SFAS 141R will have on its consolidated financial statements.

-9-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

In February 2008, the FASB issued FASB Staff Position No. 157-1 ("FSP 157-1"), Application of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13. FSP 157-1 indicates that it does not apply under FASB Statement No. 13 (“SFAS 13”), Accounting for Leases, and other accounting pronouncements that address fair value measurements for purposes of lease classification or measurement under SFAS 13. This scope exception does not apply to assets acquired and liabilities assumed in a business combination that are required to be measured at fair value under SFAS No. 141 or SFAS No. 141R, regardless of whether those assets and liabilities are related to leases.

Also in February 2008, the FASB issued FASB Staff Position No. 157-2 ("FSP 157-2"), Effective Date of FASB Statement No. 157. With the issuance of FSP 157-2, the FASB agreed to: (a) defer the effective date in SFAS No. 157 for one year for certain nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), and (b) remove certain leasing transactions from the scope of SFAS No. 157. The deferral is intended to provide the FASB time to consider the effect of certain implementation issues that have arisen from the application of SFAS No. 157 to these assets and liabilities.

In March 2008, the FASB issued SFAS No. 161 (“SFAS 161”), Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133, which changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The Company has not yet determined the impact that the application of SFAS 161 will have on its consolidated financial statements.

In May 2008, the FASB issued SFAS No. 162 (“SFAS 162”), The Hierarchy of Generally Accepted Accounting Principles. SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (“GAAP”) in the United States (the “GAAP hierarchy”). The Company does not expect the adoption of SFAS 162 will not have a material impact on the Company’s consolidated financial statements.

-10-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

In May 2008, the FASB issued SFAS No. 163 (“SFAS 163”), Accounting for Financial Guarantee Insurance Contracts, an interpretation of FASB Statement No. 60. The scope of SFAS 163 is limited to financial guarantee insurance (and reinsurance) contracts, as described in SFAS 163, issued by enterprises included within the scope of SFAS No. 60. Accordingly, SFAS 163 does not apply to financial guarantee contracts issued by enterprises excluded from the scope of SFAS No. 60 or to some insurance contracts that seem similar to financial guarantee insurance contracts issued by insurance enterprises (such as mortgage guaranty insurance or credit insurance on trade receivables). SFAS No. 163 also does not apply to financial guarantee insurance contracts that are derivative instruments included within the scope of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. The Company does not expect the application of SFAS 163 will have a material impact on the Company’s consolidated financial statements.

In May 2008, the FASB issued FASB Staff Position No. APB 14-1 ("FSP APB 14-1"), Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement).  FSP APB 14-1 clarifies that convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) are not addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants. Additionally, FSP APB 14-1 specifies that issuers of such instruments should separately account for the liability and equity components in a manner that will reflect the entity's nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. FSP APB14-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The Company is currently evaluating the impact that FSP APB 14-1 will have on its consolidated results of operations or consolidated financial position

In June 2008, the FASB issued Emerging Issues Task Force (“EITF”) Issue 07-5 (“EITF No. 07-5”) Determining whether an Instrument (or Embedded Feature) is indexed to an Entity’s Own Stock. EITF No. 07-5 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early application is not permitted. Paragraph 11(a) of SFAS No. 133, Accounting for Derivatives and Hedging Activities, specifies that a contract that would otherwise meet the definition of a derivative but is both (a) indexed to the company’s own stock and (b) classified in stockholders’ equity in the statement of financial position would not be considered a derivative financial instrument. EITF No.07-5 provides a new two-step model to be applied in determining whether a financial instrument or an embedded feature is indexed to an issuer’s own stock and thus able to qualify for the SFAS No. 133 paragraph 11(a) scope exception. Management is currently evaluating the impact of adoption of EITF No. 07-5 on the accounting for the convertible notes and related warrants transactions.

-11-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

In June 2008, FASB issued EITF Issue No. 08-4 (“EITF No. 08-4”), Transition Guidance for Conforming Changes to Issue No. 98-5. The objective of EITF No.08-4 is to provide transition guidance for conforming changes made to EITF No. 98-5, Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios, that result from EITF No. 00-27, Application of Issue No. 98-5 to Certain Convertible Instruments, and SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity. This Issue is effective for financial statements issued for fiscal years ending after December 15, 2008. Early application is permitted. The Company’s management is currently evaluating the impact of adoption of EITF No. 07-5 on the accounting for the convertible notes and related warrants transactions.

On October 10, 2008, the FASB issued FSP 157-3, Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active, which clarifies the application of SFAS 157 in a market that is not active and provides an example to illustrate key considerations in determining the fair value of a financial asset when the market for that financial asset is not active. FSP 157-3 became effective on October 10, 2008, and its adoption did not have a material impact on the Company’s consolidated financial position or results of operations for the quarter ended September 30, 2008.

l.   Property and equipment – Property and equipment is stated at cost and is depreciated using the straight-line method over their estimated useful lives.  Major renewals are charged to the property and equipment accounts while replacements, maintenance and repairs, which do not improve or extend the respective lives of the assets, are expensed currently.  The estimated useful lives of property and equipment are as follows:

	Useful lives
Exploration equipment	5 years
Office equipment	5 years
Vehicles	5 years

m.   Impairment for long lived assets – SFAS No. 144 (“SFAS 144”), Accounting for the Impairment or Disposal of Long−Lived Assets requires that long−lived assets to be disposed of by sale, including those of discontinued operations, be measured at the lower of carrying amount or fair value, less cost to sell, whether reported in continuing operations or in discontinued operations. SFAS 144 broadens the reporting of discontinued operations to include all components of an entity with operations that can be distinguished from the rest of the entity and that will be eliminated from the ongoing operations of the entity in a disposal transaction. SFAS 144 also establishes a "primary−asset" approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long−lived asset to be held and used. The Company determined that no impairment issues exist as of September 30, 2008.

n.   Foreign currency translation – The reporting currency of the Company is the US dollar.  Dongxing and Tianjin use their local currency, the Chinese Renminbi (“RMB”), as their functional currency. Results of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period, and equity is translated at the historical exchange rates.

-12-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

Translation adjustments amounted to $58,591 gain as of September 30, 2008. Asset and liability accounts at September 30, 2008, were translated at 6.84 RMB to $1.00. Equity accounts were stated at their historical rate. The average translation rates applied to income statement accounts and cash flows for the nine months ended September 30, 2008 and 2007, and from inception (March 1, 2006) to September 30, 2008 were 6.97 RMB, 7.65 RMB and 7.51 RMB to $1.00, respectively. In accordance with SFAS No. 95, Statement of Cash Flows, cash flows from the Company's operations is calculated based upon the local currencies using the average translation rates. Because cash flows are translated at average translation rates for the period, amounts reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheet.

Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

2.   Going Concern

The Company is an exploration stage company and therefore has had no revenues or cash flows from operations. The Company has an accumulated deficit of approximately $17.0 million as of September 30, 2008 and has insufficient sources of cash to execute its business plan, raising substantial doubt about its ability to continue as a going concern. In response to these conditions, management is continuing to seek both debt and equity financing from various sources, although there are no guarantees that they will be successful in their endeavors. No adjustment has been made to the accompanying financial statements as a result of this uncertainty.

3.   Restatement – Conversion of Promissory Note, Issuance of Common Stock, Litigation      and Partial Recovery of Common Stock Shares issued

As discussed in the Company’s Report on Form 8-K filed on April 22, 2009, the Company has concluded, based on further review, that it should restate the accounting for the issuance of 7,925,000 shares of its common stock under agreements entered into on April 1, 2007 for the conversion of a promissory note, previously issued by the Company and discussed below.  The transaction was previously reported as the conversion of the outstanding balance of the promissory note, including accrued interest, of $106,071, at that carrying value, into 7,925,000 shares of the Company’s common stock, representing a conversion price of $0.013 per share.  The Company has concluded that the accounting for the transaction should have been recorded at the fair value of the common stock issued and the Company should have recognized the value of services that, at that time, the Company expected to receive from the holders of the promissory note.  The Company has not received the services that it expected to receive and on December 23, 2008, the Company filed suit in the Supreme Court of the State of New York, seeking return of the shares issued and other relief.  On February 11, 2009, the Company entered into a Settlement Agreement of that suit, as a result of which a total of 3,308,333 of the 7,925,000 shares originally issued will be returned to the Company or otherwise cancelled and the Company will make payments aggregating $63,230 to the defendants, as more fully discussed below.  Reflecting the terms of the Settlement Agreement, the Company has restated its financial statements to record the shares issued at their estimated fair value and to recognize a loss of $2,205,492 as of April 1, 2007, the date of the agreements under which the shares were issued, as discussed below.

-13-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

On February 14, 2001, the Company (which was then known as ObjectSoft Corporation) executed the promissory note (the “Note”) in the amount of $100,000 to Jay N. Goldberg (the “Original Holder”). The Note, which was due on March 16, 2001 (the “Maturity Date”), accrued interest at 12% per annum and, in the event of default, accrued interest at 20% per annum. The principal plus all accrued and unpaid interest was payable in cash on the Maturity Date or, at the option of the holder, was convertible into equity securities of the Company to be issued to certain institutional investors in a proposed private placement expected to be completed at or prior to the Maturity Date.

On May 30, 2001, the Company and the Original Holder executed an Allonge and Amendment to Promissory Note, amending the Maturity Date to December 31, 2001.  The Original Holder also waived any Events of Default that may have occurred and agreed to cooperate with the Company in a potential restructuring of the Company or other transaction pursuant to which the terms of the Note may be restructured.  This restructuring was unsuccessful.  In July 2001, ObjectSoft filed a Bankruptcy Petition in the Bankruptcy Court for the District of New Jersey and, in November of 2004, emerged from the Bankruptcy filing with no assets and a single liability for the principal amount of the Note of $100,000.  None of our present officers, directors or employees were associated with us at the time of, or involved in any way in, the bankruptcy proceeding.

On November 16, 2004, the Original Holder executed an “Assignment and Endorsement of Note” and assigned all of the Original Holder’s right, title and interest in and to the Note, to Securities Acquisition New York, LLC (“SANY”).   Prior to June 2006, with the agreement of the then management of the Company, SANY converted $32,300 of the principal amount of the Note into 807,500 shares of common stock of the Company (as adjusted for subsequent stock splits), at an effective conversion price of $0.04 per share.  On October 26, 2006, SANY executed an “Agreement of Assignment of Note” and assigned all of their right, title and interest in and to the Note to West Greenwood Foundation (“WGF”).   On the date of assignment, the principal balance was $67,700 and the amount of accrued interest was $28,170.

-14-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

As described in Note 7a, the Company previously entered into consulting agreements with Saddle River Associates (“SRA”) for general business consulting and financial advisory services.  SRA introduced the Company to Xacord Corporation (as ObjectSoft was then known), which entity had originally issued the Note and with whom we completed the reverse triangular merger on February 20, 2007 (see Note 1a).  In addition, SRA advised the Company of the opportunity to invest in the Exploration and Development Agreement with Bellhaven Copper & Gold, Inc., which Agreement is described in Note 5.

Following our reverse triangular merger on February 20, 2007 (see Note 1a), on April 1, 2007, WGF and various entities and individuals (“designees”), which designees simultaneously purchased various interests in the Note from WGF, requested to convert the outstanding balance of the Note of $106,071 ($67,700 of principle and $38,371 of accrued interest) into 7,925,000 shares of our common stock, representing a conversion rate of approximately $0.013 per share.  The Company was advised by SRA that these designees would be able to provide the Company with expertise and assistance to further the development of the Company’s Panamanian Exploration and Development Agreement with Bellhaven.  Consequently, the Company agreed to the conversion and the Note was cancelled.

Over time, the Company has become aware that the designees did not possess the expertise necessary to provide the services that the Company expected that it would receive to assist it with its Panamanian operations.   On December 23, 2008, the Company filed suit in the Supreme Court of the State of New York, against SRA, WGF and the designees, seeking return of the shares issued for conversion of the Note and other relief.  The written agreements related to conversion of the Note did not refer to the provision of any services by the holders of the Note and the defendants asserted that no such agreement related to future services existed.  Notwithstanding that assertion, the defendants agreed to return a portion of the shares issued and on February 11, 2009, the Company entered into a Settlement Agreement with the defendants.  The Company concluded that it was in its best interests to accept the terms of the Settlement Agreement, rather than continue to litigate the matter.  As a result of the Settlement Agreement, of the 7,925,000 shares originally issued, 1,000,000 shares will be cancelled and a further 2,308,333 shares (one-third of the remaining shares issued of 6,925,000) will be returned to the Company.  The Company will make payments aggregating $63,230 to the defendants, representing (1) payment of principal and interest on the Note from April 2007 to the date of the Settlement Agreement for that portion of the Note for which shares are being returned and (2) outstanding consulting fees due to SRA of $25,000.

-15-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

The Company originally accounted for the conversion of the Note based on the written terms of the agreements with WGF and the designees and recorded the common shares issued at the carrying amount of the note.  However, to reflect the company’s expectation that it would also receive future services in addition to the conversion of the Note, the 7,925,000 shares issued should have been recorded at their fair value.  On April 1, 2007, the closing price of the Company’s common stock was $2.50 per share.  Although the Company’s common stock is publically traded, the trading volume is small; during the two year period ended December 31, 2007, the total trading volume of our common stock was less than 250,000 shares.  In various private placements of the Company’s common stock that occurred between April 2006 and October 2007, the Company sold an aggregate of 12,819,000 shares of its common stock for cash, each placement at a price of $0.50 per share.  Because the 7,925,000 shares issued represents a number of shares substantially in excess of the Company’s historical trading volume, the Company believes that the price of $0.50 per share at which it has effected private placements is a more reasonable estimate of fair value for the 7,925,000 shares issued than the quoted market price. Accordingly, the Company has restated its financial statements for the period ended June 30, 2007 and all subsequent periods to reflect the April 2007 issuance of the 7,925,000 shares at a fair value of $0.50 per share or an aggregate of $3,962,500.

As discussed above, the written terms of the Note provide for conversion only if a private placement was completed at or prior to maturity of the Note on December 31, 2001.  The Note bears interest at 12% and accordingly the carrying value of the Note together with accrued interest at the date of conversion is considered to be a reasonable approximation of the fair value of the Note as of that date.  In relation to the services that the Company expected to receive from the designees, EITF Issue 96-18 provides that the fair value of shares issued to non-employees for services to be performed should be determined as of the earlier of the date at which a commitment for performance by the counterparty to earn the shares is reached or the date at which their performance is complete.  EITF Issue 00-18 further provides that where there are no specific performance criteria required by the recipient in order to retain the shares issued, a measurement date has been reached and the shares should be valued as of the date of the agreement.  The Company expected that the designees would provide their services over the multi-year life of the Company’s Panamanian operations but no specific performance criteria were established.  Accordingly, the Company has valued the services it expected to receive based on the fair value of the common shares at the time they were issued, which as discussed above has been estimated at $0.50 per share.  The difference of $3,856,429 between the fair value of the shares issued of $3,962,500 and the carrying value of the Note at the date of conversion of $106,071, which carrying value is considered to be a reasonable approximation of its fair value at that date, has been allocated as the value of the services the Company expected to receive.

The Company has not received the services that it expected to receive when the shares were issued and as a result of the Settlement Agreement, the Company has recorded a loss of $2,205,492 as of April 1, 2007, reflecting the fair value of the shares that will not be returned to the Company or cancelled as a result of the Settlement Agreement, together with the amounts to be paid by the Company under the Settlement Agreement, offset by $60,000 previously recorded by the Company for amounts outstanding under the Company’s previous consulting agreements with SRA.  At June 30, 2007, the value of the shares issued on April 1, 2007 but subsequently cancelled or returned to the Company as a result of the Settlement Agreement have been recorded as contra-equity.  The affect of restatement of the Company’s financial statements as of September 30, 2007 as described above was as follows:

	Nine Months Ended September 30, 2007						From inception (March 1, 2006) to September 30, 2008
	As Previously Reported			As Restated			As Previously Reported			As Restated
Loss from expected services not received		-		$	2,205,492			-		$	2,205,492
Loss from operations	$	(3,772,811	)	$	(5,978,303	)	$	(14,075,536	)	$	(16,281,028	)
Loss before provision for income taxes		(3,830,898	)		(6,036,390	)		(14,755,716	)		(16,961,208	)
Net loss	$	(3,830,898	)	$	(6,036,390	)	$	(14,755,716	)	$	(16,961,208	)
Comprehensive loss	$	(3,822,798		$	(6,028,290	)	$	(14,697,125	)	$	(16,902,617	)
Net loss per share	$	(0.11	)	$	(0.18	)
	September 30, 2007						December 31, 2007
							(Restated)
Shareholders’ Equity	$	3,809,037		$	3,805,807		$	3,185,944		$	3,182,714

-16-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

4.   Property and Equipment

Property and equipment consist of the following at September 30, 2008 and December 31, 2007:

	September 30, 2008		December 31, 2007
Exploration equipment	$	-	$	17,110
Office equipment		28,727		4,843
Vehicles		-		28,352
Total		28,727		50,305
Less: accumulated depreciation		994		9,588
Property and equipment, net	$	27,733	$	40,717

Depreciation expenses amounted to $43,221, $7,488 and $52,568 for the nine months ended September 30, 2008 and 2007, and for the period from inception (March 1, 2006) through September 30, 2008, respectively.

5.   Long term investment

Cuprum Resources Corp. (“Cuprum”) – In March 2007, the Company, Bellhaven Copper & Gold, Inc. (“Bellhaven”) and Cuprum entered into an Exploration Development Agreement (“Agreement”). The Agreement grants the Company an option to acquire up to 75% of the authorized and outstanding stock of Cuprum, the holder of a Mineral Concession from Panama on a copper prospect located in Panama. The Agreement calls for the Company to pay Cuprum or Bellhaven $2,000,000 in annual installments of $500,000 each beginning in March 2007, issue Bellhaven 4,000,000 shares of the Company’s common stock under an escrow agreement and further cash investments totaling $15,000,000 to be used in exploration and development work on the copper prospect underlying Cuprum’s Mineral Concession. Currently, the Company owns less than 20% of Cuprum and therefore, has recorded this investment under the cost method of accounting for investments. As of September 30, 2008, the Company has made its first two cash installment payments of $500,000, invested another $3,874,528 which was used for exploration and development work, and issued 2,666,667 shares of common stock at $0.50 per share or $1,333,334. Accordingly, the Company recorded $6,207,862 as investments in the accompanying balance sheet which includes the $3,874,528 incurred in exploration and development work. The exploration and development work is made up of the project costs for the period. The project costs include drilling, general geology, camp, mobilization, geophysics, land administration, assays and shipping, helicopter, office and management expenses. The costs have been capitalized by the Company as part of the Company’s acquisition of the 75% stake in Cuprum, as per the Agreement. Another 1,333,333 shares of common stock has been placed into escrow and are recorded as shares in escrow until such time as the shares are released at which time the Company will reflect an increase to both the investment and equity.

Zhaoyuan Dongxing Gold Mining Co., Ltd. (“Zhaoyuan Dongxing”) – The Company entered into a joint venture agreement with Zhaoyuan Dongxing Gold Mining Co., Ltd. (“Dongxing”) to conduct gold mining activities in the PRC. The agreement calls for a total capital contribution of $500,000 from the Company. Dongxing will contribute various mining licenses and other assets such as instruments and equipment. The Company will receive a 50% equity stake in the joint venture in exchange for its $500,000 contribution. Dongxing will receive the remaining 50% stake in the joint venture in exchange for its contribution of mining licenses and other assets. The amount was due and payable when Dongxing acquired the required business license approvals in PRC. On December 20, 2006, the joint venture company, Zhaoyuan Dongxing, was approved by the Chinese government and the business license was granted on December 21, 2006.  The Company has contributed the full $500,000 capital contribution as per the joint venture agreement.  The Company consolidates the financial statements of Zhaoyuan Dongxing into its financial statements because the Company exercises control over the Zhaoyuan Dongxing through its 50% ownership; additionally, the Company has the right to appoint three of the five board of director members and has control over the selection of key management personnel.

-17-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

Empire (Tianjin) Resources Co., Ltd. (“Tianjin”) – In November 2006, the Company and Tianjin Institute of Geology and Mineral Resources (“TIGMR”) signed a cooperative joint venture agreement to form Tianjin. The purpose of the joint venture is to engage in the exploration and development of gold and other mineral products in PRC. The agreement calls for a $1,000,000 total capital contribution. The Company obtained a 70% equity stake in the joint venture in exchange for $1,000,000. The $1,000,000 contribution is required to be paid in installments after the approval by the Chinese government. The approval and the business license were received on April 12, 2007. The Company’s made the first two installment payments of $200,000 on July 5, 2007 and $300,000 on September 5, 2007, and was required to make a third installment of $500,000 on or before May 30, 2008. TIGMR was required to contribute mining licenses and mineral data to the joint venture for the remaining 30% interest per Amendment Number 2, by May 30, 2008. As of September 30, 2008, TIGMR had not transferred the licenses and therefore the Company did not transfer the third installment into Tianjin.  The Company and TIGMR are currently negotiating an extension for the transfer of the licenses.  The term of the joint venture is 30 years beginning on April 12, 2007, the date the business license was issued. The Company has consolidated the financial statements of the joint venture into the its financial statements as the Company exercise control over the joint venture by its 70% of ownership.

6.   Convertible Note Payable and Short Term Loan

a.   In February 2001, the Company executed a Promissory Note (“Promissory Note”) in the amount of $100,000 to Jay N. Goldberg (“Holder”).  See Note 3 for further discussion on this Note.

b.   On June 25, 2007, the Company executed a Convertible Promissory Note (“Convertible Promissory Note”) in the amount of $300,000.  The Convertible Promissory Note was payable in 90 days, bearing a total of $26,000 interest during the term of the note.  The Company also incurred additional fees associated with the Convertible Promissory Note in the amount of $34,000 and warrants to purchase 300,000 shares of the Company’s common stock at an exercise price of $1.00 for a two-year term. This note is secured by 600,000 shares of the Company’s common stock, and the Company’s interest in income generated from the operations and sales of certain identified exploration / mining leases in Panama and PRC. The Holder of the Convertible Promissory Note may at any time convert the principal amount for shares of the Company’s common stock at a rate of $1.00 per share.  On September 19, 2007, the Company and the Holder executed an Amendment to the note. Pursuant to the amended agreement, the maturity date was extended to December 15, 2007. In addition, the warrant granted to the Holder to purchase 300,000 shares of common stock at $1.00 for a two-year term was canceled and new warrant was granted to the Holder to purchase 300,000 shares of common stock at $0.65 for a two-year term. On December 15, 2007, the Company and the Holder executed Amendment 2 to Convertible Promissory Note (“Amendment 2”). Pursuant to Amendment 2, the interest rate became 9% and the maturity date was extended to May 31, 2008. Additionally, the Company issued the Holder 600,000 shares of common stock at $0.65 per share.  On January 28, 2008, the Company repaid $100,000 of the principal.  On July 16, 2008, the Company paid the remaining principal balance of $200,000 plus an additional amount of $69,000, however, the 200,000 shares of common stock relating to late fees pursuant to the Amendment has not been issued as of September 30, 2008.

-18-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

c.   On June 26, 2007, the Company executed another Convertible Promissory Note in the amount of $300,000. The Company received $150,000 which represents the first half of the proceeds on the same date and the remaining $150,000 in July 2007. This note is payable in 120 days and bears a total of $15,000 interest during the term of the note.  The Company also incurred additional fees associated with the note in the amount of $15,000 and 100,000 shares of the Company’s common stock. The note is secured by 600,000 shares of the Company’s common stock, and the Company’s interest in income generated from the operations and sales of certain identified exploration / mining leases in Panama and China. The Holder of the note may at any time convert the principal amount for shares of the Company’s common stock at a rate of $1.00 per share. On October 29, 2007, the Company repaid the entire principal in cash to the Note Holder. On October 30, 2007, the Company paid the Note Holder $15,000, which represented the additional fees incurred in connection with the note.

d.   On July 2, 2007, the Company executed a Convertible Promissory Note in the amount of $500,000.  This note is payable in 90 days and bears a total of $25,000 interest during the term of the note.  The Company also incurred additional fees associated with the note in the amount of $25,000 and 100,000 shares of the Company’s common stock.  The holder of the note may at any time convert the principal amount for shares of the Company’s common stock at a rate of $1.00 per share. On July 5, 2007, the Company paid the interest and additional fees and issued 100,000 shares of common stock to the holder pursuant to the note. On September 19, 2007, the Company repaid the entire principal by issuing 1,000,000 Special Warrants to the Note Holder.

e.   On January 22, 2008, the Company executed a Convertible Promissory Note in the amount of $350,000.  This note is payable in 30 days and bears interest at a rate of 6% per annum.  The Company also incurred additional fees associated with the note in the amount of $33,000.  The Holder may at any time convert the principal amount for shares of the Company’s common stock at a rate of $1.00 per share.  On February 22, 2008, the Company and the Holder executed an Amendment to the note (“Amendment”). Pursuant to the Amendment, the maturity date was extended to May 31, 2008 (“Amended Maturity Date”), bearing interest at a rate of 6% per annum.  On April 25, 2008, the Company and the Holder executed Amendment No. 2 to the note (“Amendment 2”). Pursuant to Amendment 2, the maturity date was extended to July 31, 2008 (“Amended Maturity Date 2”), bearing interest at a rate of 6% annum.  The Company also incurred additional fees associated with Amendment 2 in the amount 250,000 shares of the Company’s common stock, which approximated $125,000.  On July 22, 2008, the Company paid the full amount of principal to the Note Holder to satisfy the note.

-19-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

f.   Loan Payable – On March 10, 2008, the Company entered into a Loan Agreement in the amount of $1,650,000 with Balstone Investments Ltd.  The loan bears interest at a rate of 3-monthly LIBOR (approximately 4.6% at March 10, 2008) plus 1% and is payable in full on September 11, 2008.  As security for the prompt and complete payment of the loan, a personal guarantee was granted by the Chief Executive Officer of the Company including a share charge over the Chief Executive Officer’s entire shareholding in the Company. On July 28, 2008, the Company paid the full balance of the loan and interest due to Balstone Investments Ltd.

Total interest expense for the above convertible notes payable and short term loans for the three months ended September 30, 2008 and 2007, and for the nine months ended September 30, 2008 and 2007, and from inception (March 1, 2006) to September 30, 2008 amounted to $35,772 and $0, $158,130 and $0, and $285,180, respectively.

7.   Related Party Transactions

a.   Saddle River Associates – The Company entered into three agreements with Saddle River Associates (“SRA”), a shareholder in the Company. The first transaction dated March 26, 2006 relates to a one year Advisory Agreement in which SRA will provide consulting services related to locating and evaluating financing alternatives, corporate structuring and other business issues for $15,000 per month. The agreement automatically renews annually, unless either party gives 90 days notice to terminate. The Company did not pay any amounts to SRA for the nine months ended September 30, 2008, however certain amounts were paid in cash in accordance with the agreement through to November 2007. On April 15, 2008 the Company canceled the agreement.

The second agreement, an Acquisition Services Agreement, dated April 9, 2006 amended on December 15, 2006 and June 1, 2007, relates to additional consulting services whereby SRA will identify and introduce prospective merger entities and will assist the Company with the business aspects of the transaction.  Pursuant to this agreement, SRA introduced the Company to Xacord; SRA had no relationship to Xacord prior to identifying and introducing them to the Company as a potential merger partner. The Company paid SRA $250,000 upon signing the agreement and a total of $550,000 which represents payment in full for the services as per the agreement. The related expense is included in the accompanying consolidated statement of operations. The Company was also required to issue 500,000 warrants when and if the Company obtained at least $3,000,000 in financing and for each $1,000,000 in financing received over $3,000,000, the Company was to issue an additional 100,000 warrants up to a total of 1,000,000 warrants. The warrants were to have a 5 year life, would vest upon grant, and would be exercisable at $0.50 per share. The warrants were canceled pursuant to Amendment Number 2, executed on June 1, 2007.

Additionally, the Company entered into a third agreement with SRA in October 2006. The agreement called for consulting services to the Company on a month to month basis, for $5,000 per month, prior to the merger between the Company and its subsidiary. This agreement was terminated on the date of the merger, February 21, 2007.

-20-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

b.   Chief Financial Officer – The Company’s Chief Financial Officer (“CFO”) provided consulting services to the Company prior to the merger to assist in merger preparations at $5,000 per month on a month to month basis beginning in November 2006 through February 21, 2007. As of April 1, 2007, the CFO resumed providing consulting services to the Company at $8,000 per month on a month to month basis. The services provided include the day to day financial management of the company and any other functions related to the financial operations of the Company.

On June 18, 2007, the Company and the CFO entered into a Stock Repurchase Agreement in which the Company repurchased from the CFO, 100 shares of the Company’s outstanding Series I Preferred Stock (“Preferred Shares”) held by the CFO for $10,000.

c.   Euro Centro Consulting Corp. – The Company entered into 2 agreements with Euro Centro Consulting Corp. (“Euro”), as shareholder in the Company. For the first transaction dated July 15, 2007, the Company and Euro entered into a consulting agreement. Pursuant to the agreement, the Company received one-time referral services from Euro in exchange for a cash fee of $50,000 and 100,000 shares of common stock. The shares were valued at $0.50 per share, for a total amount of $50,000, which was expensed for the year ended December 31, 2007.

Under the terms of the second transaction dated November 2, 2007, the Company received a one-time referral services from Euro in exchange for a cash fee of $50,000 and 10,000 shares of common stock. The shares were valued at $0.50 per share, for a total amount of $5,000 which was expensed for the year ended December 31, 2007.

8.   Shareholders’ equity

The Company is authorized to issue 705,000,000 shares: 700,000,000 shares of $0.0001 par value common stock and 5,000,000 shares of $0.0001 par value preferred stock. As of September 30, 2008, the Company has 72,902,928 of Common Stock outstanding, including 1,333,333 shares held in escrow.

a.   Effective August 11, 2006, the Company amended the Articles of Incorporation as follows: Each twenty (20) shares of Common Stock then issued was automatically combined into one share of Common Stock of the Company (“20-1 reverse split”).  No fractional shares or scrip representing fractions of a share were issued, but in lieu thereof, each fraction of a share that any stockholder would otherwise be entitled to receive was rounded up to the nearest whole share.  As a result of the 20-1 reverse split, the issued number of shares of Common Stock was reduced by 88,377,055, from 93,028,479 shares of Common Stock issued prior to the 20-1 reverse split to 4,651,424 shares of Common Stock issued subsequent to the 20-1 reverse split.  The rounding of fractional shares to the nearest whole share resulted in an additional 661 shares being issued to stockholders who would have been entitled to receive a fraction of a share.  The total number of shares of Common Stock issued after the issuance of the rounding of fractional shares was 4,652,085.

-21-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

b.   Effective January 22, 2007, the Company amended the Articles of Incorporation as follows: Each twenty (20) shares of Common Stock then issued was automatically combined into one share of Common Stock of the Company (“20-1 reverse split”). No fractional shares or scrip representing fractions of a share were issued, but in lieu thereof, each fraction of a share that any stockholder would otherwise be entitled to receive was rounded up to the nearest whole share.  As a result of the 20-1 reverse split, the issued number of shares of Common Stock was reduced by 4,419,481, from 4,652,085 to 232,604 shares of Common Stock. The rounding of fractional shares to the nearest whole share resulted in an additional 248 shares being issued to stockholders who would have been entitled to receive a fraction of a share.  The total number of shares of Common Stock issued after the issuance of the rounding of fractional shares was 232,852.

c.   On February 20, 2007, the Company issued 26,504,000 shares of its common stock for 26,504,000 shares of common stock representing all of the outstanding stock of its subsidiary pursuant to the triangular merger accounted for as a reverse merger and recapitalization. Additionally, all warrants issued by the subsidiary and outstanding as of February 20, 2007 were exchanged for warrants in the Company.  Prior to the merger, the Subsidiary had entered into several agreements which accounted for the shares of common stock outstanding:

(1) Upon the formation of the Subsidiary, the founding shareholders received 6,460,000 shares of common stock for $6,460. During the quarter ended March 31, 2008, the Company received $4,900 as payment for the shares. Therefore, subscriptions receivable totaled $1,560 at September 30, 2008.

(2) On March 29, 2006, the Subsidiary issued to management and key consultants 8,500,000 shares for services valued at $76,500 and cash of $8,500, totaling $0.01 per share. As of March 31, 2007, the Subsidiary had received $8,500 in cash for payment. The Subsidiary recorded $76,500 of consulting expense during the year ended December 31, 2006.  Additionally, the Subsidiary issued warrants to purchase up to a total of 5,970,000 to management and consultants. The warrants were vested upon grant, have a 3 year life, and are exercisable at $0.10 per share. Warrants to purchase up to 3,500,000 shares of common stock issued to management contained a cashless exercise provision. The warrants were valued at $197,587 using the Black-Scholes option pricing model, using a volatility rate of 62% based on the volatility of a publicly traded exploration stage company in a similar stage of development, and a risk free rate of 4.79%. The Subsidiary recognized $197,587 of compensation expense during the year ended December 31, 2006.  As of September 30, 2008, warrants with options to purchase a total of 450,000 were exercised for cash.  The Subsidiary received $45,000 in cash for the exercise of the warrants.  Warrants with options to purchase a total of up to 2,000,000 were exercised utilizing the cashless exercise provision. A total of 1,600,000 shares of common stock were issued to management in the transaction. Two warrants to purchase a total of up to 3,500,000 shares of common stock were canceled pursuant to an Agreement for Cancellation of Warrants entered into by and between the parties.

-22-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

(3) During the period from April 2006 through February 19, 2007, the Subsidiary sold 7,499,000 shares of common stock at a price of $0.50 per share for cash totaling $3,749,500.

(4) During the year ended December 31, 2007, the Subsidiary issued 2,299,000 shares of its common stock to various individuals and entities in exchange for consulting services to the Subsidiary. The Company recorded consulting expenses in the amount of $1,079,979 in the accompanying consolidated statement of operations and $69,521 prepaid for consulting services for the year ended December 31, 2007.

(5) On February 19, 2007, the Subsidiary issued to its President and Chief Executive Officer, 1,500,000 shares of common stock as a bonus for his services to the Subsidiary and as incentive compensation for future services.  The Company recorded consulting expenses in the amount of $750,000 in the accompanying consolidated statement of operations for the year ended December 31, 2007.

d.   On March 9, 2007, the Company issued 4,000,000 shares of Common Stock to Bellhaven Gold & Copper, Inc. (“Bellhaven”) as part of an Exploration Development Agreement (“agreement”) entered into by and between the Company, Bellhaven and its wholly-owned subsidiary, Cuprum Resources Corp (“Cuprum”).  The agreement grants the Company an option to acquire up to 75% of the authorized and outstanding stock of Cuprum, the holder of a Mineral Concession from Panama on a copper prospect located in Panama.  The agreement calls for the Company to pay Cuprum or Bellhaven $2,000,000 in annual installments of $500,000 each, issue Bellhaven shares of the Company’s common stock as valued under an escrow agreement with a total value of $4,000,000 and expend $15,000,000 in exploration and development work on the copper prospect underlying Cuprum’s Mineral Concession. As per the agreement, the Company has delivered a certificate in the amount of 2,666,667 shares of common stock to Bellhaven and deposited 1,333,333 shares of its common stock into escrow. The Company has recorded $1,333,334 as investment on the accompanying consolidated balance sheet.

e.   On April 1, 2007, the Company issued 7,925,000 shares of common stock to West Greenwood Foundation (“WGF”) and various entities and individuals (“designees”), pursuant to the conversion of the Convertible Promissory Note executed by the Company in February 2001.  See Note 3 for further discussion on this stock issuance.

f.   On May 4, 2007, the Company completed a Private Placement to sell 4,000,000 shares of Common Stock at $0.50 per share for cash totaling $2,000,000. The transaction was completed in the form of a Restricted Equity Purchase Agreement and called for the Company to deposit the Stock Certificate representing the sold shares with a custodial bank selected by the purchaser.  The closing date of the transaction was scheduled for 30 days from the date of the deposit of the Stock Certificate with the custodial bank. The agreement has since been canceled and the shares have been recalled from the custodial bank.

-23-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

g.   On June 18, 2007, the Company and the CFO entered into a Stock Repurchase Agreement in which the Company repurchased from the CFO, 100 shares of the Company’s outstanding Series I Preferred Stock (“Preferred Shares”) held by the CFO.  The Preferred Shares were repurchased by the Company from the CFO for $10,000. The Preferred Shares repurchased represented the total amount of Preferred Stock issued and outstanding. Subsequent to the repurchase of the Preferred Shares, the Company filed a Certificate of Designation with the state of Delaware and canceled the Series I Preferred Stock.

h.   On June 26, 2007, the Company issued 100,000 shares of common stock as a form of payment for additional fees directly related to a Convertible Promissory Note (see Note 6c).

i.   On July 2, 2007, the Company issued 100,000 shares of common stock as a form of payment for additional fees directly related to a Convertible Promissory Note (see Note 6d).

j.   On July 31, 2007, the Company completed a Private Placement to sell 1,000,000 shares of common stock at a price of $0.50 per share for cash totaling $500,000.  The transaction was completed in the form of a Subscription Agreement and called for the Company to issue warrants to purchase 1,000,000 shares of common stock at $1.00 per share for a two-year term. Pursuant to the agreement, the Company is required to file a registration statement within 150 days and it be declared effective within 210 days.  As of September 30, 2008, the Company has not filed the registration statement and has accrued $45,600 in liquidated damages which were expensed during the current period.

k.   From August 2007 to October 2007, the Company sold a total of 320,000 shares of common stock in the form of Subscription Agreements at $0.50 per share.  The total proceeds to the Company for the sale of the shares were $160,000.

l.   On December 15, 2007, the Company issued 600,000 shares of common stock as a form of payment for additional fees directly related to a Convertible Promissory Note (see Note 6b).

m.   In December 2007, the Company issued 100 shares of preferred stock at par value of $0.0001 to the Company’s CEO for compensation and expensed $10,000.  The value of the preferred stock was determined by the recent buy-back from the Company’s CFO at $100 per share.

n.   On April 18, 2008, the Company agreed to issue 4,550,000 shares of common stock to its directors in consideration of their past services.  The Company recorded directors’ compensation expenses in the amount of $2,275,000 in the accompanying consolidated statements of operations for the nine months ended September 30, 2008.

o.   On April 25, 2008, the Company agreed to issue 250,000 shares of common stock as a form of payment for additional fees directly related to a Convertible Promissory Note (see Note 6e).

-24-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

p.   On July 10, 2008, the Company completed a Private Placement to sell to certain investors 21,840,000 shares of common stock, 100 shares of preferred stock and 14,203,000 warrants for cash totaling $10,046,400.  The transaction was completed in the form of Binding Term Sheet (“Term Sheet”) and called for the Company to:

(1) The issuance of an aggregate of 21,840,000 new shares of the Company’s common     stock at $0.46 per share.  $8,500,000 shall be paid by the investors within five business days upon execution of the Term Sheet (First Settlement Date) and the balance shall be paid within 90 calendar days upon the execution of the Term Sheet (Second Settlement Date);

(2) The issuance of the Company’s 100 preferred stock;

(3) The cancellation of the Company’s 100 preferred stock held by the Chief Executive Officer;

(4) The issuance of an aggregate of 10,920,000 warrants (“First Warrants”) on the First and Second Settlement Dates.  Each First Warrant entitles the investors to purchase one new share of the Company’s common stock at a price of $0.46 per share.  The First Warrant will expire 23 calendar days following the publication of the second independent resource statement for Cerro Chorcha to National Instrument 43-101 standard after the date of the Term Sheet;

(5) The issuance of an aggregate of 3,283,000 warrants (“Second Warrants”) on the First and Second Settlement Dates.  Each Second Warrant entitles the investor to purchase one new share of the Company’s common stock at a price of $0.50 per share, with term date of six months.  The Second Warrant can only become exercisable upon the exercise and payment in full of all First Warrants.

As of September 30, 2008, 21,789,566 shares of the common stock had been issued in connection with the Term Sheet.

q.   On July 11, 2008, the Company issued 650,000 common shares and paid a cash of $250,000 to certain entities in exchange for consulting and advisory services directly related to the consummation of the Term Sheet. The Company recorded consulting expenses in the amount of $299,000 in the accompanying consolidated statement of operations for the three months ended September 30, 2008.  The cash payment was treated as a reduction from the gross proceeds from the Term Sheet.

r.   On July 11, 2008, the Company issued 666,666 common shares to the Company’s Chief Operating Officer as a compensation for the completion of the Term Sheet.  The Company recorded employee compensation expense of $306,666 in the accompanying consolidated statement of operations.

-25-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

On June 25, 2007, the Company granted warrants to purchase 300,000 shares of the Company’s common stock, as a form of payment for additional fees directly related to a Convertible Promissory Note (see Note 6b). The warrant has an exercise price of $1.00 per share for a two-year term. The warrant was canceled on September 19, 2007 and a new grant was issued in the form of a warrant to purchase 300,000 shares of common stock at an exercise price of $0.65, was issued to the note holder. The fair values of the warrants were estimated at the date of grant using the Black-Scholes option–pricing model with the following assumptions:

Expected	Expected	Dividend	Risk Free	Grant Date
Life	Volatility	Yield	Interest Rate	Fair Value
2 years	48.69%	-	4.78%	$31,641

From August 2007 to September 2008, the Company received a total of $2,296,420 in cash, net of $11,080 loss in currency exchange, and the cancellation of a Promissory Note in the amount of $500,000, for the sale of 5,615,000 Special Warrants offered by the Company at a price of $0.50 per Special Warrant.  Each Special Warrant is convertible into one share of common stock and one half of one Common Share purchase warrant (each whole warrant, a “Warrant”).  Each Warrant will entitle the holder to acquire one share of common stock at an exercise price of $0.65 for a two-year term. The Special Warrants Agreement includes an addendum requires the Company (i) to register the shares underlying both the converted shares and the warrants, (ii) to complete a registration statement to be filed within 150 days, and (iii) effective within 210 days. The Agreement imposes cash penalties of 1% per 30 day period for non-compliance. The potential registration penalties should be accounted for in accordance with FSP EITF 00-19-2. That FSP requires that the penalties be accounted for in accordance with FAS 5, that is, they are recognized when they are “probable” and can be “reasonably estimated”, which may be at inception. As of September 30, 2008, the Company has not filed the registration statement and has accrued $220,050 in liquidated damages which have been expensed during the current period.  In July 2008, 2,015,000 shares of common stock were issued upon conversion by holders of Special Warrants of the Special Warrants to common stock.

On November 25, 2007, the Company granted stock options to purchase up to 5,400,000 shares of the Company’s common stock to management and employees of the Company, pursuant to the Company’s 2007 Employee Incentive Plan. The stock options have an exercise price of $0.50 per shares for a five-year term.

On December 15, 2007, the Company granted warrants to purchase 300,000 shares of the Company’s common stock, as a form of payment for additional fees directly related to Amendment 2 to Convertible Promissory Note (see Note 6b). The warrant has an exercise price of $0.65 per share for a two-year term.

On January 26, 2008, the Company granted stock options to purchase up to 200,000 shares of the Company’s common stock to a director of the Company, pursuant to the Company’s 2007 Employee Incentive Plan. The stock options have an exercise price of $0.50 per share for a five-year term.

-26-

DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

On May 6, 2008, the Company granted Special Warrants to purchase 376,000 shares of the Company’s common stock to a certain entity as a form of payment for advisory services it provided to the Company.  The Special Warrants were sold at $0.50 per warrant.  Subsequently, the Special Warrants were converted to the Company’s common stock.

On July 11, 2008, the Company has granted warrants to purchase 1,200,000 shares of the Company’s common stock to a certain entity as a form of payment for consulting services it provided to the Company.  The warrants have an exercise price of $0.53 per share for a one-year term.

On July 31, 2008, the Company granted stock options to purchase up to 250,000 shares of the Company’s common stock to a director of the Company, pursuant to the Company’s 2007 Employee Incentive Plan.  The stock options have an exercise price of $0.51 per share for a five-year term.

On September 1, 2008, the Company granted stock options to purchase up to 250,000 shares of the Company’s common stock to an employee of the Company pursuant to the Company’s 2007 Employee Incentive Plan.  The stock options have an exercise price of $0.50 per share for a five-year term.

The Company had 19,603,000 warrants outstanding as of September 30, 2008 and the following is a summary of the warrant activities:

			Weighted-	Average
	Number of	Number of	Average	Remaining
	Warrants	Warrants	Exercise	Contractual
	Outstanding	Exercisable	Price	Life
Balance at December 31, 2006	5,950,000	5,950,000	$       0.10	2.75 years
Granted	300,000	300,000	1.00	2.00 years
Forfeited	(5,500,000)	(5,500,000)	-
Exercised	(450,000)	(450,000)	0.10
Balance at June 30, 2007	300,000	300,000	$1.00	2.00 years
Granted	5,760,000	300,000	0.51	2.00 years
Forfeited	-	-	-	-
Exercised	-	-	-	-
Balance at December 31, 2007	6,060,000	600,000	$ ��     0.58	1.63 years
Granted	15,934,000	-	-	1.77 years
Forfeited	-	-	-
Exercised	(2,391,000)	-	-
Balance at September 30, 2008	19,603,000	600,000	$       0.64	1.20 years

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DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

In November 2007, the Board of Directors of the Company adopted and approved the 2007 Stock Option Plan (the “Plan”) which authorized the issuance of up to 6,750,000 shares under the Plan. The fair values of stock options granted to employees were estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions:

	Expected Life	Expected Volatility	Dividend Yield	Risk Free Interest Rate	Grant Date Fair Value
Employees – 2007	5.0 years	61%	0%	3.52%	8,100,000

The Company determined its expected volatility and dividend yield based on the historical changes in stock price and dividend payments. The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company determined the option’s expected life based on historical exercise behavior.

Following is a summary of the stock option activity:

	Options Outstanding		Weighted Average  Exercise Price		Aggregate Intrinsic Value
Outstanding as of December 31, 2006		-	$	-	$	-
Granted		-		-		-
Forfeited		-		-		-
Exercised		-		-		-
Outstanding as of June 30, 2007		-	$	-	$	-
Granted		5,400,000		0.50		-
Forfeited		-		-		-
Exercised		-		-		-
Outstanding as of December 31, 2007		5,400,000	$	0.50	$	-
Granted		700,000		0.50		-
Forfeited		-		-		-
Exercised		-		-		-
Outstanding as of September 30, 2008		6,100,000	$	0.50	$	-

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DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

For the nine months ended September 30, 2008 and 2007 and from inception (March 1, 2006) to September 30, 2008, the Company has expensed $998,406, $0 and $1,592,776 in stock option expenses, respectively.

9.   Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and the amounts used for income tax purposes.  Significant components of the Company’s deferred tax assets and liabilities at September 30, 2008 are as follows:

Net operating loss for the nine months ended September 30, 2008	$	6,843,680
Effective income tax rate		40	%
Total deferred tax assets		2,737,472
Less: valuation allowance		(2,737,472	)
Total deferred tax assets as of September 30, 2008	$	-

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DOMINION MINERALS CORP. AND SUBSIDIARIES

(FORMERLY EMPIRE MINERALS CORP.)

(AN EXPLORATION COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2008

(UNAUDITED)

Net operating loss from inception (March 1, 2006) to September 30, 2008	$	16,961,208
Effective income tax rate		40	%
Total deferred tax assets		6,784,483
Less: valuation allowance		(6,784,483	)
Total deferred tax assets as of September 30, 2008	$	-

The Company’s deferred tax asset as of September 30, 2008 of $6,784,483 was fully offset by a valuation allowance, resulting in a net deferred tax asset of $0 because of the uncertainty of the Company’s ability to utilize the net operating loss carryforward against future earnings.

The reconciliation of the effective income tax rate to the federal statutory rate for the period ended September 30, 2008 is as follows:

Federal income tax rate	34	%
State tax, net of federal benefit	6	%
Increase in valuation allowance	(40	) %
Effective income tax rate	-	%

The deferred tax assets result from net operating loss carry-forwards. These assets will therefore reverse either upon their utilization against taxable income or upon their statutory expiration. Net operating loss carry-forwards will expire beginning in 2020 through 2028.

10.   Commitments – The Company and its Subsidiary entered into various agreements during the period beginning March 2006 (Subsidiary’s inception date) and ending September 30, 2008.  These include:

a. Empire (Tianjin) Resources Co., Ltd. – The Company is to pay $500,000 on or before May 31, 2008 to Tianjin pursuant to the cooperative joint venture agreement.  (See Note 5).  The Company is currently negotiating an extension for the payment.

b. Employment Agreements – On April 12, 2006, the Company entered into employment agreements with its Chief Executive Officer and its Vice President of Exploration. The agreements have a term of two years and are automatically renewed for two year terms unless the Company or the employee gives 90 days prior written notice to terminate the agreement. On December 1, 2007, the Company entered into a new employment agreement with its Chief Executive Officer and its Chief Financial Officer. The agreements have terms of five years and three years, respectively. The agreements are automatically renewed for one year term unless the Company or Executive gives 90 days prior written notice to terminate the agreement.  On May 1, 2008, the Company entered into employment agreement with its Chief Operating Officer.  The agreement has a term of either three years or the submission of the feasibility study of the copper mining project in Panama, whichever comes earlier.  The agreement may be renewed in writing no later than 30 days prior to the termination date.

c. Office Lease – The Company is subject to a six month license agreement dated February 14, 2008 for office space requiring monthly payments of $6,450. The agreement expires August 31, 2008 and is automatically renewed for an additional six month term unless the Company gives written notice of cancellation on or before June 1, 2008.  The Company did not provide written notice prior to June 1, 2008, therefore, the agreement has been automatically renewed for an additional six month period or through February 28, 2009. The Company leased additional space at another location.  The additional space is leased on a month to month basis at a rate of $1,445 per month.

d. Cuprum Resources Corp. – In March 2007, the Company, Bellhaven Copper & Gold, Inc. (“Bellhaven”) and Cuprum Resources Corp (“Cuprum) entered into an Exploration Development Agreement (“agreement”).  The agreement requires the Company over the next three years to issue 4 million shares of the Company’s common stock and make cash payments in the amount of $17,000,000.  At September 30, 2008, the Company released 2,666,667 shares of its common stock from escrow and made cash payments of $4,874,528.

Commitments are summarized as below:

Period ending December 31,
2008	$	7,005,000
2009		7,166,666
2010 and thereafter		500,000

11.   Subsequent Event

On October 14, 2008, the Company received the remaining balance of $23,200 from the Second Settlement Date.  Accordingly, the Company issued 50,434 shares of the Company’s common stock fulfilling its commitment under the Term Sheet.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements and Associated Risks. Except for statements of historical facts, this report contains forward-looking statements involving risks and uncertainties. You can identify these statements by forward-looking words including “believes,” “considers,” “intends,” “expects,” “may,” “will,” “should,” “forecast, “ or “anticipates,” or the equivalents of those words or comparable terminology, and by discussions of strategies that involve risks and uncertainties. Forward-looking statements are not guarantees of our future performance or results, and our actual results could differ materially from those anticipated in these forward-looking statements. We wish to caution readers to consider the important factors, among others, that in some cases have affected, and in the future could affect our actual results and could cause actual consolidated results for future fiscal years to differ materially from those expressed in any forward-looking statements made by us or on our behalf. These factors include without limitation, our ability to obtain capital and other financing in the amounts and at the times needed, identification of suitable exploration properties for acquisition, the successful discovery of gold, silver or other precious metals in quantities economically feasible for profitable production, changes in gold and silver prices, changes in the political climate for gold and silver exploration, and other risk factors listed from time to time in our Securities and Exchange Commission reports, including in particular the factors and discussions under the heading “Risk Factors” in the Amendment No. 4 to Form 10 that was filed with the Securities and Exchange Commission (“SEC”) and became effective on December 21, 2007.

Overview of Business

The Company was formed as a Delaware corporation on January 4, 1996, under the name ObjectSoft Corporation. On May 9, 2005, The Company changed its name to Nanergy, Inc. On June 5, 2006, its name was changed to Xacord Corp. On January 3, 2007, the Company changed its name to Empire Minerals Corp., and in November 2007, the name was changed to its current name, Dominion Minerals Corp.

We were originally formed in January of 1996 to acquire the business of a predecessor company, ObjectSoft Corporation, a New Jersey Corporation. This acquisition was completed in the form of a corporate business combination effective January 31, 1996. The acquired business involved the provision of retail Kiosks, which were internet-connected, advertising-interactive public access terminals offering information entertainment and the ability to execute financial transactions via a touch screen. This business was unsuccessful and in July of 2001, we filed a Bankruptcy Petition in the Bankruptcy Court for the District of New Jersey. None of our present officers, directors or employees were associated with us at the time of or involved in any way in our bankruptcy proceeding. In November 2004, we exited bankruptcy with no assets, one liability in the form of a convertible promissory note with a principal balance of $100,000 and outstanding stock of 195 shares of common stock. We then operated as a shell corporation seeking a new business opportunity either through a corporate business combination or an acquisition of assets.

In September 2005, we were a party to a business combination in which we acquired the ownership of a New Jersey corporation holding licenses, patents, and developments to certain photovoltaic processes. In this transaction, the Company issued 99,455 shares of our common stock. The Company also agreed to issue additional shares of common stock and stock options, if certain economic milestones were met by December 31, 2006. These economic milestones were not met. In 2006, we abandoned our efforts to develop the involved processes.

On February 20, 2007, we completed a business combination in which we acquired all of the outstanding stock of the Nevada Subsidiary in exchange for shares of our common stock. The combination was structured as a three-party merger in which:

(A) The Company acquired all of the outstanding stock of the Nevada Subsidiary;

(B) A Nevada corporation named Xacord Acquisitions Sub Corp. formed and wholly-owned by the Company to be used as a vehicle for the transaction was merged into the Nevada Subsidiary;

(C) The outstanding shares of the common stock of the Nevada Subsidiary as of the effective time of the merger were converted into shares of the common stock of the Company on a share-for-share basis with a total of 26,504,000 shares of the Company's stock issued in this conversion;

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(D) The Company assumed four warrants issued by the Nevada Subsidiary to purchase up to a total of 4,500,000 shares of the Company's Common Stock at $0.10 per share during a three year term. These warrants were held as follows: (i) a warrant for 2,000,000 shares was held by Saddle River Associates, Inc., a financial and business consultant to the Company; (ii) an additional warrant for 500,000 shares was held by Saddle River Associates, Inc.; (iii) a warrant for 1,500,000 shares was held by Pinchas Althaus, President and a director of the Company; and (iv) a warrant for 50,000 shares was held by Chaya Schreiber, a former shareholder of the Nevada Subsidiary. The warrant to purchase 50,000 shares was exercised on March 2, 2007. The remaining three warrants for 4,000,000 were canceled by mutual agreement of the parties on June 1, 2007.

The Company assumed a contingent obligation of the Nevada Subsidiary to issue warrants to Saddle River Associates, Inc. to purchase up to 500,000 shares of the Company's common stock at $0.50 per share during a five-year term from issuance, if the Company obtains specified amounts of additional capital; and the Company acquired the rights of the Nevada Subsidiary under a Letter of Intent to enter into the agreements relating to the acquisition of the majority interest in the Panamanian corporation holding the concession to the copper prospect.

Management of the parties at the time of the business combination consisted of the following individuals: (i) Diego Roca was the sole officer and director of the Company and of Xacord Acquisition Sub Corp.; and (ii) Pinchas Althaus, Diego Roca and Bruce Minsky were the officers and directors of the Nevada Subsidiary. Messrs. Althaus, Roca and Minsky became the three officers and directors of the Company and the Nevada Subsidiary upon completion of the business combination.

The following diagrams set forth the organizational status of the Company and the Nevada Subsidiary before and after the completion of their business combination.

Status Before Business Combination:

Actions in Business Combination:

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Status After Business Combination:

The Company is engaged in the acquisition, exploration, development and operation of mineral and natural resource properties and prospects. The present activities are concentrated on mineral prospects and properties located in the Republic of Panama and in the People's Republic of China.

The Company has entered into an agreement with Bellhaven Copper & Gold, Inc. (“Bellhaven”), a British corporation and its wholly-owned subsidiary, Cuprum Resources, Corp. (“Cuprum”), a Panamanian corporation. Under this agreement, the Company may acquire a majority ownership interest in Cuprum Resources, Corp. Cuprum holds a mineral concession from the Republic of Panama on a copper prospect located in the Guariviara Area of Panama.

The Nevada Subsidiary has entered into two joint venture agreements involving mineral properties and/or prospects located within China. These properties are primarily regarded as gold prospects or properties. One of the Chinese joint venture agreements of the Nevada Subsidiary is with Zhaoyuan Dongxing Gold Minerals Co., Ltd., an entity organized under the China Company Law. Under this agreement, the parties have formed Zhaoyuan Empire Gold Corp., Ltd., a Chinese entity in which they each own a 50% interest subject to future adjustment. This jointly held entity holds three mining licenses from the Chinese government on gold prospects located in the Shandong Province of China along with certain mining and mill equipment. As of September 30, 2008, we discontinued our participation in the joint venture.

The other joint venture agreement of the Nevada Subsidiary is with the Tianjin Institute of Geology and Mineral Resources (“TIGMR”), a Chinese legal entity. Under this agreement the parties have formed a Chinese limited liability company named Empire (Tianjin) Resources Co., Ltd. This entity was formed to acquire mineral interests in and explore, develop and, if warranted, conduct mining operations on mineral properties located in the Inner Mongolian Autonomous Region of Tianjin Province in China. The Nevada Subsidiary holds a 70% interest in this entity subject to future adjustment to reflect the parties' respective capital contributions.

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The following chart sets out our present organizational structure:

The proposed operations of the two Chinese joint ventures and the acquisition of the majority interest in the Cuprum Resources, Corp. and operations on the Panamanian prospect will require our expenditure of materially more capital than is presently available to us. Our proposed operations include:

· Acquiring the majority interest in the Panamanian corporation holding the mineral concession and providing financing for and supervising its operations;

· Supervising, and if necessary providing or procuring additional financing for, the operations of the two Chinese joint ventures;

· Exploring and evaluating additional mineral and natural resource acquisitions; and

· Seeking the necessary additional capital to finance activities.

Going Concern

The report of our independent auditors in our December 31, 2007, financial statements includes an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going concern due to recurring losses from operations, an accumulated deficit of approximately $10,100,000 at December 31, 2007, and having insufficient sources of cash to execute our business plan. Our ability to continue as a going concern will be determined by our ability to raise additional capital to adequately fund our business plan. In response to these conditions, we are continuing to seek both debt and equity financing from various sources, although there are no guarantees that we will be successful in our endeavors. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures, such as the fair value of warrants and stock issued for services as well as various accruals. For example, we must calculate the fair value of options and warrants granted based on various assumptions. Accordingly, the actual results could materially differ from those estimates. We have identified certain accounting policies that are most important to the portrayal of our current financial condition and results of operations. Our significant accounting policies are disclosed in Note 1 of the Notes to Consolidated Financial Statements.

Several of those critical accounting policies are as follows. Please refer to Note 1, Nature of Business and Significant Accounting Policies, including Note 1b, Basis of Presentation; Note 1c, Use of Estimates; Note 1d, Fair Value of Financial Instruments; and Note 1i, Income Taxes.

Results of Operations

Discussion of Revenues

We have no revenues at this time and have not had any revenues in recent years, because we are an exploration stage company. We do not anticipate that significant revenues will be achieved for the next 24 months.

Expenses for the Three Month Period ended September 30, 2008 vs. September 30, 2007

The following table presents our consolidated statements of operations and other comprehensive loss, as a percentage of loss, for the periods indicated.

	For the three months ended						For the three months ended
	September 30, 2008						September 30, 2007
REVENUE		-		Nil				-		Nil
EXPENSES
Research & development costs	$	16,495			0.88	%	$	48,140			4.71	%
Consulting fees		761,191			40.75	%		320,363			31.36	%
Professional fees		124,322			6.65	%		110,673			10.83	%
Other employee compensation		312,272			16.71	%		-		Nil
Loan costs		63,526			3.40	%		144,084			14.10	%
Directors compensation		75,599			4.05	%		-		Nil
General & administrative expenses		352,942			18.90	%		325,553			31.87	%
Liquidated damage expense		69,600			3.73	%		-		Nil
Depreciation		37,669			2.02	%		2,852			0.29	%
TOTAL EXPENSES	$	1,813,616			97.09	%	$	951,665			93.16	%
Other (income) expense		56,311			3.01	%		72,558			7.10	%
Other comprehensive loss (income)		(2,092	)		-0.10	%		(2,687	)		-0.26	%
LOSS BEFORE INCOME TAXES		1,867,835			100.00	%		1,021,536			100.00	%
Income tax benefit (expense)		-		Nil				-		Nil
COMPREHENSIVE LOSS	$	1,867,835			100.00	%	$	1,021,536			100.00	%

Research and development costs decreased by $31,645, or 66%, to $16,495 for the three months ended September 30, 2008 as compared to $48,140 for the three months ended September 30, 2007. The principal reason for this decrease was due to decreased exploration activity on the Dongxing joint venture property.

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For the three months ended September 30, 2008, professional fees increased $13,649, or 12%, to $124,322 as compared to $110,673 for the three months ended September 30, 2007. This increase for the three month period is due to legal fees incurred related to the sale of shares to various investors during the quarter ended September 30, 2008.

For the three months ended September 30, 2008, other employee compensation expense totaled $312,272 as compared to $0 for the three months ended September 30, 2007. This increase of $312,272 is due to the issuance of shares of common stock to our Chief Operating Officer in accordance with the Employment Agreement entered into.

For the three months ended September 30, 2008, loan costs decreased $80,558, or 56%, to $63,526 as compared to $144,084 for the three months ended September 30, 2007. This decrease is due to amortized financing costs recorded during the three months ended September 30, 2007, for several Convertible Promissory Notes entered into by us, during the year ended 2007. During the quarter ended September 30, 2008, the Notes were paid in full and amortized loan costs decreased.

For the three months ended September 30, 2008, directors’ compensation expense totaled $75,599 as compared to $0 for the three months ended September 30, 2007. This increase of $75,599 is due to the payment of fees to the directors of the Company for past services and the issuance of options to a director as payment for services.

For the three months ended September 30, 2008, liquidated damage expense totaled $69,600 as compared to $0 for the three months ended September 30, 2007. This increase of $69,600 is due to penalties incurred pursuant to the registration rights clause in the Exploration and Development Agreement entered into by Bellhaven and us.

Expenses for the Nine Month Period ending September 30, 2008 v September 30, 2007

The following table presents our consolidated statements of income (loss), as a percentage of loss, for the periods indicated.

	For the nine months ended						For the nine months ended
	September 30, 2008						September 30, 2007
							(Restated)
REVENUE		-		Nil				-		Nil
EXPENSES
Research & development costs	$	120,831			1.77	%	$	323,875			5.37	%
Consulting fees		1,043,116			15.32	%		2,342,805			38.86	%
Professional fees		248,039			3.64	%		267,532			4.44	%
Other employee compensation		1,259,808			18.50	%		-		Nil
Loan costs		462,615			6.79	%		144,084			2.39	%
Directors compensation		2,350,599			34.52	%		-		Nil
General & administrative expenses		453,172			6.66	%		687,027			11.40	%
Loss from expected services not received		-		Nil				2,205,492			36.59	%
Liquidated damage expense		265,650			3.90	%		-		Nil
Depreciation		43,221			0.63	%		7,488			0.12	%
TOTAL EXPENSES	$	6,247,051			91.73	%	$	5,978,303			99.17	%
Other expense		596,629			8.76	%		58,087			0.96	%
LOSS BEFORE INCOME TAXES		6,843,680			100.49	%		6,036,390			100.13	%
Income tax benefit (expense)		-		Nil				-		Nil
Other comprehensive (income)		(33,425	)		-0.49	%		(8,100	)		-0.13	%
COMPREHENSIVE LOSS	$	6,810,255			100.00	%	$	6,028,290			100.00	%

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Research and development costs decreased by $203,044, or 63%, to $120,831 for the nine months ended September 30, 2008 as compared to $323,875 for the nine months ended September 30, 2007. The principal reason for this decrease was due to decreased exploration activity on the Dongxing joint venture property.

Consulting fees decreased by $1,299,689, or 56%, to $1,043,116 for the nine months ended September 30, 2008 as compared to $2,342,805 for the nine months ended September 30, 2007. The principal reason for this decrease was due to referral fees paid in 2007, not incurred in 2008. In addition, during the nine months ended September 30, 2007, we incurred consulting costs pursuant to the Exploration and Development Agreement entered into by us and Bellhaven.

For the nine months ended September 30, 2008, professional fees decreased $19,493 or 7%, to $248,039 as compared to $267,532 for the nine months ended September 30, 2007. This decrease for the nine month period is due to accounting and legal fees related to the issuance of 2007 first quarter financial statements, audited financial statements for the period ending September 30, 2007, and the filing of our Form 10SB during the nine months ended September 30, 2007.

For the nine months ended September 30, 2008, other employee compensation expense totaled $1,259,808 as compared to $0 for the nine months ended September 30, 2007. This increase of $1,259,808 is due to the grants of stock options under the 2007 Employee Incentive Plan and shares of common stock, to our management, directors and an employee. The fair values of the options granted were estimated at the date of the grant utilizing the Black-Scholes option-pricing model.

For the nine months ended September 30, 2008, loan costs increased $318,531 or 221%, to $462,615 as compared to $144,084 for the nine months ended September 30, 2007. This increase of $318,531 is due to amortized loan costs recorded during the nine months ended September 30, 2008, for Convertible Promissory Notes entered into by us, during the year ended 2007 and the nine months ended September 30, 2008.

For the nine months ended September 30, 2008, directors’ compensation expense totaled $2,350,599 as compared to $0 for the nine months ended September 30, 2007. This increase of $2,350,599 is due to the issuance of shares, stock options and cash payments to the directors of the company for past services. The shares were issued at a value of $0.50 per share. The fair values of the options granted were estimated at the date of the grant utilizing the Black-Scholes option-pricing model.

For the nine months ended September 30, 2008, liquidated damage expense totaled $265,650 as compared to $0 for the three nine months ended September 30, 2007. This increase of $265,650 is due to penalties incurred pursuant to the Special Warrants issued and the penalties incurred pursuant to the registration rights clause in the Exploration and Development Agreement entered into by Bellhaven and us.

Liquidity and Capital Resources

Cash and Working Capital

As of September 30, 2008 and 2007, we had positive working capital $4,858,201 and $1,526,799, respectively.  This was due to an increase in current assets of $4,862,541 and $1,958,219 for the three months ended September 30, 2008 and September 30, 2007, respectively, a decrease in current liabilities of $2,420,038 and $19,620 for the three months ended September 30, 2008 and September 30, 2007, respectively. We had an increase in working capital of $4,736,868 and $652,560 for the nine months ended September 30, 2008 and September 30, 2007, respectively.  This was due to an increase in current assets of $4,708,536 and $1,231,850 for the nine months ended September 30, 2008 and September 30, 2007, respectively, a decrease in current liabilities of $28,332 for the nine months ended September 30, 2008 and an increase in current liabilities of $579,290 for September 30, 2007, respectively.  We had an accumulated deficit of $10,117,528 from the date we exited bankruptcy proceedings in October 2004 to December 31, 2007, and an accumulated deficit of $16,961,208 at September 30, 2008. We have no contingencies or long-term obligations except for our work commitments under our Exploration and Development Agreement with Bellhaven and Cuprum Resources Corp. 

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We had a cash balance of $878,116 and $1,033,899 as of December 31, 2007 and December 31, 2006, respectively, and a cash balance of $5,618,839 and $2,091,228 as of September 30, 2008 and September 30, 2007, respectively.  For the three months ended September 30, 2008 and 2007, we had positive cash flows of $4,848,536 and $1,783,698, respectively. For the nine months ended September 30, 2008 and 2007, we had positive cash flows of $4,740,523 and $1,043,351, respectively.

On January 22, 2008, we received $350,000 from the issuance of a Convertible Promissory Note (“Note”). The Note is payable in 30 days and bears interest at a rate of 6% annum. We also incurred additional fees associated with the Note in the amount of $33,000. The holder may at any time convert the principal amount for shares of our common stock at a rate of $1.00 per share. On February 22, 2008, we executed an Amendment (“Amendment”) to the Note. Pursuant to the Amendment, the maturity date was extended to May 31 2008 (“Amended Maturity Date”), bearing interest at a rate of 6% annum. On April 25, 2008, we executed Amendment No. 2 to the Note (“Amendment 2”). Pursuant to Amendment 2, the maturity date was extended to July 31, 2008 (“Amended Maturity Date 2”), bearing interest at a rate of 6% annum. We also incurred additional fees associated with Amendment 2 in an amount equivalent to 250,000 shares of our common stock, which approximated $125,000. On July 22, 2008, we repaid the full principal amount of the Note.

On March 10, 2008, we received $1,650,000 pursuant to a Loan Agreement with Balstone Investments Ltd. The loan bears interest at a rate of 3-month LIBOR plus 1% and was payable in full on September 11, 2008. As security for the prompt and complete payment of the loan, a personal guarantee was granted by our Chief Executive Officer which includes a share charge over his entire shareholdings in the Company. On July 28, 2008, we repaid the full amount of the loan including interest.

In July 2008 we received $10,023,075 which represented the proceeds pursuant to a private placement entered into by us on July 10, 2008, in the form of a binding Term Sheet for 21,840,000 units in the aggregate consisting of 21,840,000 shares of common stock (the “Common Stock”) of the Company, warrants to purchase up to 10,920,000 shares of Common Stock at an exercise price of $0.46 per share, and warrants to purchase up to 3,283,000 shares of Common Stock at an exercise price of $0.50 per share to certain accredited investors and to non-US persons for total gross proceeds to the Company of $10,046,400. The remaining balance of approximately $23,000 was received in October 2008.

Internal and External Sources of Liquidity

Over the next 12 months, we plan to fund our operations through the sale of common stock or common stock with warrants.

Contractual Obligations

We have no commitments for capital expenditures.

We do not engage in hedging transactions and we have no hedged mineral resources.

We were, and are committed to, making certain exploration work expenditures and option payments pursuant to the Exploration and Development Agreement and Joint Venture Agreement signed at December 31, 2007, over the next 12 months:

Cerro Chorcha Project:

· Required work expenditure by March 7, 2009; $9,000,000 of which $3,874,528 has been paid. The exploration and development plan for Phase 1 was completed as of March 6, 2008; a work plan for the period of March 7, 2008 to March 7, 2009 has been formulated and approved jointly by Bellhaven and us.

· Annual payment: $500,000 due March 7, 2008 was paid on March 14, 2008; $500,000 due March 7, 2009.

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TIGMR Project:

· Joint Venture Contribution: $500,000 due May 31, 2008; we are currently negotiating an amendment to the Joint Venture agreement with our Joint Venture Partner in order to obtain an extension for the payment of our Joint Venture contribution.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements. We do not engage in hedging transactions and we have no hedged resources.

Item 3. Qualitative Disclosures About Market Risk.

None.

Item 4T. Controls and Procedures.

(a)Evaluation of disclosure controls and procedures.

Pinchas Althaus, who serves as the Company’s chief executive officer, and Diego Roca, who serves as the Company’s chief financial officer, after evaluating the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this quarterly report (the “Evaluation Date”) concluded that as of the Evaluation Date, the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported as specified in the SEC's rules and forms and to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to our management to allow timely decisions regarding required disclosure.

(b)Changes in internal control over financial reporting.

There were no changes in the Company’s internal control over financial reporting during the three months ended September 30, 2008, that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

PART II

Item 1. Legal Proceedings.

None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

1.      (a)  From July 3, 2008 to September 24, 2008, the Company issued 2,391,000 shares of its common stock.

  (b)           No person acted as a principal underwriter for the sale of these securities. The common stock was issued to twelve individuals and entities collectively, as follows: (i) Haywood Securities, Inc. – 376,000 shares; (ii) Greg McKenzie – 200,000 shares; (iii) Thomas Seltzer – 100,000 shares; (iv) John Willett - 200,000 shares; (v) Kerry Smith – 200,000 shares; (vi) Andrew Kaip – 40,000 shares; (vii) Stefan Ioannou – 20,000 shares; (viii) Nochum Sosover – 30,000 shares; (ix) CYB Trust – 1,000,000 shares; (x) Oren Antebi – 25,000 shares; (xi) Jason Mausberg – 50,000 shares; and (xii) Menachem Gansburg – 150,000 shares.

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                         (c)           These securities were issued to the above holders of Special Warrants subsequent to each holder exercising their right to convert the Special Warrants for share of common stock. There were no underwriting fees, discounts or expenses involved in the issuance of this stock.

                         (d)           In the issuance of these shares of its common stock, the Company relied upon the exemption from the registration requirements of Section 5 of the Securities Act provided in Section 4(2) of the Securities Act and by Regulation D adopted under the Securities Act. These shares were issued as restricted securities and a legend denoting the restrictions on their transferability under the Securities Act was placed upon the certificates issued to represent the securities.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

The Company’s Board of Directors does not presently have a standing nominating committee or any committee performing similar functions. Since the Board presently consists of only six members, all of its directors will participate in the nomination process.

Item 6. Exhibits.

Exhibit No.	Description of Exhibits
3.1	Term Sheet – Issuance and Private Placement of Common Stock, Series A Preferred Stock and Warrants in Dominion Minerals Corp.*
31.1	Officers Certifications under Section 302 of the Sarbanes-Oxley Act of 2002*
31.2	Officers Certifications under Section 302 of the Sarbanes-Oxley Act of 2002*
32.1	Certification of Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002.*

____________________

*           Filed herewith.

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		DOMINION MINERALS CORP.
Date:	November 14, 2008	By:	/s/ Pinchas Althaus
			PINCHAS ALTHAUS
			Chief Executive Officer
Date:	November 14, 2008	By:	/s/ Diego Roca
			DIEGO ROCA
			Executive Vice President, Chief Financial
			Officer and Treasurer

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