SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
GENTOR RESOURCES, INC.
(Name of small business Issuer in its charter)
Florida 1000 20-2679777
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification No.)
incorporation or Classification Code
organization) Number)
1 Alder Gulch Road
Virginia City, Montana 59755
(406)843-5383
(Address and Telephone Number of Principal Executive Offices and
Principal Place of Business)
Lloyd J. Bardswich, President
Gentor Resources, Inc.
1 Alder Gulch Road
Virginia City, Montana 59755
(406)843-5383
(Name, Address and Telephone Number of Agent for Service)
Copies to:
Edward H. Gilbert, Esq.
Edward H. Gilbert, P.A.
5100 Town Center Circle, Suite 430
Boca Raton, Florida 33486
(561) 361-9300 Ext. 202
<PAGE i>
Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes
effective.
If this Form is filed to register additional securities for an
offering pursuant to 462(b) under the Securities Act, check the
following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering. ( )
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ( )
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ( )
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. ( )
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
each class be maximum maximum registration
of registered offering aggregate fee
securities price per offering
to be Share (1) price (1)
registered
Common 200,000 $5.00 $1,000,000 $117.70
Stock, shares
$.0001 par
value
(1) Estimated solely for purpose of calculating the registration fee.
The Registrant hereby amends this Registration Statement on such
date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically
states that this Registration Statement shall thereafter become
<PAGE ii>
effective in accordance with Section 8(a) of the Securities Act of
1933 or until the Registration Statement shall become effective on
such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE iii>
The information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities,
and it is not soliciting an offer to buy these securities in any
state where the offer or sale is not permitted.
Subject to completion, dated December 15, 2005
Prospectus
Gentor Resources, Inc.
200,000 shares of Common Stock
$5.00 per share
Per Share Minimum Maximum
Initial Offering $5.00 $175,000 $1,000,000
Price to Public
Commissions $0.00 $0 $0
Proceeds to
Gentor Resources $5.00 $175,000 $1,000,000
This is our initial public offering. There has never been a public
market for our common stock, and we have arbitrarily determined the
offering price.
We are offering the shares on a "best efforts" basis. We are making
the offering through our president, who will not be compensated for
offering the shares. Any prospective purchaser will be required to
purchase a minimum 1000 shares. All proceeds from the offering will
be deposited into a non-interest bearing special receipts account in
our name, and unless we receive paid subscriptions for at least
35,000 shares by May 31, 2006, no shares will be sold and all
proceeds held in the special receipts account will be returned to
subscribers without interest. If we receive paid subscriptions for
at least 35,000 shares by May 31, 2006, we will transfer those
proceeds from the special receipts account to our general operating
account. Any proceeds that we receive after the receipt of proceeds
from the sale of 35,000 shares will be deposited directly into our
general operating account. If we sell at least 35,000 shares by May
<PAGE 1>
31, 2006, we may extend our offering until the earlier of September
30, 2006 or the time that all 200,000 shares are sold.
An investment in the shares involves substantial risks and is
speculative. See "Risk Factors" beginning on page 9 of this
prospectus.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
The date of this prospectus is December 15, 2005
<PAGE 2>
In making a decision whether to buy our common stock, you should
only rely on the information contained in this prospectus. We have
not authorized anyone to provide you with any different or other
information. The information in this prospectus may only be
accurate on the date of this prospectus.
<PAGE 3>
PROSPECTUS SUMMARY
Because this is only a summary, it does not contain all of the
information that may be important to you. Before deciding whether to
invest in our common stock, you should carefully read the entire
prospectus. In this prospectus, references to "we," "us" and "our"
refer to Gentor Resources, Inc.
Our Proposed Business
We are in the business of gold exploration. We entered into a
Mining Exploration and Option Agreement (the "Option Agreement")
with Hartmut W. and Inga M. Baitis (the "Claim Owner"), which Option
Agreement relates to six (6) unpatented mining claims, Gold #1
through Gold #6 (collectively, the "Subject Claims") owned by the
Claim Owner within the Delmoe Lake Property in Jefferson County,
Montana (the "Property"). The Claim Owner is unrelated to us.
A memorandum of our Option Agreement has been recorded in the public
records of Jefferson County, Montana. Our Option Agreement grants
us a mining lease and provides us with an exclusive option to
purchase the Subject Property. The purchase price of the Subject
Property is $1,000,000, along with a 2% Net Smelter Return Royalty.
We made an initial payment of $7,500 upon execution of the Option
Agreement. An Additional payment of $7,500 is due on the first
anniversary date of the Option Agreement with additional payments of
$10,000 each due on each the next two subsequent anniversary date
and with additional payments of $15,000 each due on each subsequent
anniversary date until the Purchase Price is paid or the Option
Agreement is terminated or cancelled.
In addition to the payments we are required to pay to the Claim
Owner, we are required to pay $750.00 per annum to the United States
Department of the Interior, Bureau of Land Management in order to
retain the Subject Claims.
The 120 acre Delmoe Lake Property is located in southwest Montana
approximately 25 miles east of Butte in Sections 14 and 15, Township
3 North, Range 6 West, within the Homestake Mining District of
Jefferson County, Montana. The Delmoe Lake Property is located on
the southeast flank of the Boulder Batholith. A major
<PAGE 4>
northeast-southwest trending lineament is immediately adjacent to
the mineralized area.
Little information is available on the history of the Delmoe Lake
Property or surrounding area prior to 1981. In September of 1981,
Noranda Exploration Company conducted surface and underground chip
and channel sampling. Noranda sampling of narrow (2 to 3 feet)
quartz-pyrite veins showed high-grade results up to 0.612 oz/ton
gold. Under the supervision of the Claim Owner, 18 samples were
collected of which 5 were from underground workings. Independence
Mining carried out a sampling program in 1992 consisted of 17
samples. Their sampling confirmed the previous Noranda results.
The potential economic significance of the Subject Claims is based
upon the sampling results previously reported. The Subject Claims
have not yet been explored by us and until we are able to validate
otherwise, the Property is without known reserves.
The Property is accessed by 13 miles of improved and unimproved
gravel road off of Interstate Highway 90. Butte Montana, a major
regional center with a population of estimated 40,000 and a domestic
airport, is located approximately 25 miles to the west. A 2 mile
4-wheel drive road would be used to access the Property from Delmoe
Lake, but such road will require work to provide access for heavy
equipment.
Infrastructure in the region around the Property appears to be good
with nearby power, phone, services, hotels, restaurants, housing and
an extensive pool of skilled labor. Cellular service is available
at the Property. The Property is at an altitude of between 6,600 and
7,200 feet and consists of mountainous terrain dropping
south-westward into the Delmoe Lake basin. The area is forested
predominately by lodge pole pine. Weather conditions include
snowfalls as early as September until as late as early June.
Average precipitation is estimated at 25 inches per annum.
Temperatures range from -50O F in January to +80O F in July.
We are an exploration stage company and there is no assurance that
commercially viable gold-bearing mineral deposits exist on any of
the Subject Claims. Our objective is to conduct a two Phase
exploration program on the Subject Claims to assess whether they
possess any commercially viable gold-bearing mineral deposits.
Although certain historical data reports the presence of
<PAGE 5>
gold-bearing mineral deposits, we cannot provide any assurance that
the Subject Claims will prove commercially viable.
Our plan is to complete the first Phase of our exploration program
in order to confirm historical reports about our claims. We
anticipate that the cost to undertake Phase 1 of our exploration
program is approximately $140,000.00. We anticipate that the work
included as part of Phase 1 of our exploration program will include
surface geologic mapping, sampling, survey control, road
rehabilitation, adit rehabilitation and trenching with subsequent
mapping, sampling and analysis, soil survey, permitting and bonding.
If Phase 1 of our exploration program is successful, we expect to
proceed with a second Phase of our exploration program. Phase 2 of
our exploration program is expected to include further excavation,
drilling and engineering studies, and is expected to cost us
approximately $250,000.00. Until we have completed Phase 2 of our
exploration program, we can not determine if commercially viable
gold deposits exist within the Subject Claims. If we receive at
least the minimum proceeds of our offering, we will have adequate
funds to complete Phase 1 of our exploration program, but we will
not have sufficient funds to proceed with Phase 2 of our exploration
program. If we receive the maximum proceeds of our offering we will
have sufficient funds to complete Phase 2 of our exploration
program.
Depending upon the receipt of proceeds of our offering and
permissible weather conditions, we expect to commence Phase 1 of our
exploration program during the month of June of the calendar year
2006 and we anticipate that Phase 1 will be concluded within three
months after commencement. Until we complete Phase 1 of our
exploration program, we are unable to determine when or if Phase 2
of our exploration program would commence. Should we undertake
Phase 1 of our exploration program and if the results thereof do not
confirm historical results, we anticipate that we will not terminate
the Option Agreement and hope for higher gold prices, provided that
we have adequate funds to do so. Additionally, if Phase 1 of our
exploration program does not produce favorable results, we intend to
acquire new claims for exploration, if we have the adequate funds to
do so.
To date our founders, Arnold T. Kondrat and Lloyd J. Bardswich have
contributed an aggregate of $50,000 to our capital in exchange for
<PAGE 6>
which we have issued 450,000 and 50,000 shares of our common stock,
respectively to such parties.
Since our inception, we have not generated any revenues, and we have
incurred losses. We have not yet commenced operations, and our
auditors have, as part of their report on our financial statements,
included a "going concern opinion". A "going concern opinion"
expresses substantial doubt as to our ability to continue as a going
concern. Currently, we are entirely reliant upon receipt of at
least the minimum proceeds of our offering to commence our proposed
operations.
Corporate Information
We are a Florida corporation formed on March 24, 2005.
Our executive offices are located at 1 Alder Gulch Road, Virginia
City, Montana 59755, and our telephone number is(406)843-5383.
Our Offering
Common stock offered by us Up to 200,000 shares. The
minimum purchase is 1,000
shares.
Public offering price of $5.00 per share.
shares being offered by us
Offering Period Unless we receive paid
subscriptions for at least
35,000 shares by May 31, 2006,
no shares will be sold and all
proceeds will be returned to
subscribers without interest.
If we sell at least 35,000
shares by that date, we may
extend our offering until the
earlier of September 30, 2006
or the time that all 200,000
shares are sold.
<PAGE 7>
Common stock to be outstanding 535,000 shares if 35,000 shares
after the offering are sold or 700,000 shares if
200,000 shares are sold.
Use of proceeds We intend to use the net
proceeds primarily to undertake
our exploration program as to
the Subject Claims and to pay
our operating expenses and for
other general corporate
purposes. See "Use of Proceeds."
We initially intend to offer our shares in the states of Florida and
New York, although we may expand our offering to other states.
Summary Financial Information
BALANCE SHEET
September 30, 2005
TOTAL CURRENT ASSETS $19,365
TOTAL ASSETS $19,365
TOTAL CURRENT LIABILITIES $31,703
TOTAL LIABILITIES $31,703
STOCKHOLDERS' EQUITY (DEFICIENCY) ($12,338)
TOTAL LIABILITIES AND STOCKHOLDERS' $19,365
EQUITY (DEFICIENCY)
<PAGE 8>
INCOME STATEMENT
From inception to
September 30, 2005
INCOME
OPERATING INCOME $0
INTEREST INCOME $106
TOTAL INCOME $106
OPERATING EXPENSES $19,309
OTHER EXPENSES - $43,135
TOTAL EXPENSES $62,444
NET LOSS $62,338
NET LOSS PER SHARE $0.12
RISK FACTORS
An investment in our common stock involves substantial risks. You
should consider carefully the following information about these
risks, together with the financial and other information contained
in this prospectus, before you decide whether to buy our common
stock. If any of these risks actually occur our financial condition
and results of operations would likely not permit us to continue to
operate and our business could fail. In such case, you might lose
all or part of your investment.
<PAGE 9>
RISKS RELATED TO OUR PROPOSED BUSINESS
Because we have only recently commenced business and have a limited
operating history there is no basis upon which you can evaluate our
proposed business and prospects.
* We were incorporated under the name Gentor Resources, Inc.
on March 24, 2005, and to date have been involved
primarily in organizational activities and obtaining our
Option Agreement.
* We have not begun the exploration of our Subject Claims,
and there is no way to evaluate the likelihood of whether
we will be able to operate our proposed business
successfully.
* If our business fails to develop in the manner we have
anticipated, you will lose your investment in the shares.
* If our business develops our officer may be unable to
effectively or efficiently operate our business in which
event you will lose your investment in the shares.
Because we just recently commenced our business, our prospects for
success must be considered in the light of the extraordinary risks,
unforeseen expenses and problems that newly formed mineral
exploration companies normally encounter.
* The creation, execution and maintenance of our plans for
our business operation are based solely upon the opinion
of our management and may not have adequately anticipated
unforseen expenses and other problems that newly formed
mineral exploration companies normally encounter. If we
have failed to adequately address business commencement
risks, our business will not develop or grow, and you will
lose your investment in the shares.
* New mineral exploration companies are traditionally
subject to high rates of failure.
<PAGE 10>
* New mineral exploration companies can be expected to
encounter unanticipated problems relating to exploration
and additional costs and expenses that may exceed current
estimates.
As a newly formed mineral exploration company, we will be required
to implement our proposed business, and if we are unable to do so
you will lose your investment in the shares.
* The likelihood of success must be considered in the light
of problems, expenses, difficulties, complications and
delays encountered in connection with the exploration of
the mineral properties that we plan to undertake.
* We can provide no assurance to investors that we will
generate any operating revenues or ever achieve profitable
operations.
* If we are unsuccessful in implementing exploration plans
or those plans prove unsuccessful our business will likely
fail and you will lose your entire investment in the shares.
As a newly formed mineral exploration company, we will be required
to anticipate and handle potential growth and we may not be able to
do so in which event you will lose your investment in the shares.
* If our Subject Claims prove successful, our potential for
growth will place a significant strain on our technical,
financial and managerial resources. We may have to
implement new operational and financial systems and
procedures, and controls to expand, train and manage
employees and to coordinate our technical and accounting
staffs, and if we fail to do so you will lose your
investment in the shares.
Because of the limited capital available to us for the foreseeable
future, we may not have sufficient capital to implement our business
plan.
* We are obligated to pay our operating expenses as they
arise, including required annual fees to the State of
<PAGE 11>
Florida. If we sell any of our shares in this offering, we
will incur legal and accounting expenses to comply with
our reporting obligations to the SEC. If we fail to pay
any of the forgoing, we may be forced to cease our
business operations.
* If we receive the proceeds of the sale of the minimum
number of our shares, we will be able to continue with our
limited our operations, and we will be able to undertake
Phase 1 of our exploration plans, but we will not be able
to undertake Phase 2 of our exploration plans.
* If we receive the proceeds of the sale of the maximum
number of our shares, we will be able to implement our
proposed business plan, and we anticipate that we will
have sufficient funds to continue our proposed business
operations for at least 12 months.
If we need to raise additional funds, the funds may not be available
when we need them. We may be required to provide rights senior to
the rights of our shareholders in order to attract additional funds
and, if we use equity securities to raise additional funds dilution
to our shareholders may occur.
* To the extent that we require additional funds, we cannot
assure you that additional financing will be available
when needed on favorable terms or at all, and if the funds
are not available when we need them, we may be forced to
terminate our business.
* If additional funds are raised through the issuance of
equity securities, the percentage ownership of our
existing stockholders will be reduced; and those equity
securities issued to raise additional funds may have
rights, preferences or privileges senior to those of the
rights of the holders of our common stock.
If we fail to make required payments under the Option Agreement or
to the United States Department of the Interior, Bureau of Land
Management, we will lose the right to the Subject Claims.
* In order to maintain our rights under the Option Agreement
we must timely make annual payments to the Claim Owner and
<PAGE 12>
to the United States Department of the Interior, Bureau of
Land Management , and if we fail to do so we will lose our
option as the Option Agreement will be terminated.
* If our Option Agreement is terminated we may be forced to
cease our business operations in which event you will lose
your investment in the shares.
If our exploration program provides results indicating a
commercially viable gold deposits exist within the Subject Claims we
will be required to raise substantial additional capital or locate a
joint venture partner in order to achieve production and generate
revenue from such deposits.
* If the initial results of our exploration program are
successful, we may try to enter a joint venture agreement
with a partner for the further exploration and possible
production from any mineral deposits within the Subject
Claims.
* If we entered into a joint venture agreement, we would
likely be required to assign a percentage of our interest
in the Subject Claims to the joint venture partner.
* If we are unable to enter into a joint venture agreement
with a partner, or if we are otherwise unable to raise
substantial additional capital, our business may fail and
you will lose your entire investment in the shares.
Most, if not all, of our competition will be from larger, more well
established and better financed companies, and if we are unable to
successfully compete with other companies our business will fail.
* If we are able to implement our business operations,
substantially all of our competitors will have greater
financial resources, technical expertise and managerial
capabilities than we do.
* If we are unable to overcome such competitive
disadvantages, we will be forced to cease our business
<PAGE 13>
operations and you will lose the investment in the shares.
We currently have no employees other than our officer, we have no
employment agreement with our officer, our officer serves on a
part-time basis, we cannot pay our officer any compensation, and if
our officer were to leave our employ, our business could fail.
* Because our ability is engage in business is dependent
upon, among other things, the personal efforts, abilities
and business relationships of our officer, if our officer
were to terminate employment with us or become unable to
provide such services before a qualified successor, if
any, could be found, our business could fail.
* Our current officer does not provide full time services to
us, and we will not have full-time management until such
time, if ever, as we engage employees on a full-time basis.
* We do not maintain "key person" insurance on our officer,
and if our officer were to die or become disabled, we do
not have any insurance benefits to defer the costs of
seeking a replacement.
We may be unable to attract or retain employees in which event our
business could fail.
* Competition for personnel in the junior mineral
exploration industry is intense. Because of our limited
resources, we may not be able to compensate our employees
at the same level as our competitors. If we are unable
to attract, retain and motivate skilled employees, our
business could fail.
* We cannot assure you that we will have the financial
resources to hire full-time personnel when they are needed
or that qualified personnel will then be available, and if
we are unable to hire full-time personnel when they are
needed, our business could fail.
<PAGE 14>
As a result of the speculative nature of mineral property
exploration, there is substantial risk that no commercially
exploitable minerals will be found and our business will fail.
* Exploration for minerals is a speculative venture
necessarily involving substantial risk. We can provide
you with no assurance that our Subject Claims contain any
commercially exploitable reserves.
* The exploration work that we intend to conduct on the
Subject Claims may not result in the discovery of
commercial quantities of gold.
* Problems, such as unusual and unexpected rock formations
and other conditions, are involved in mineral exploration
and often result in unsuccessful exploration efforts. In
such a case, we would be unable to complete our business
plan and you would lose your entire investment in the shares.
There are inherent dangers involved in mineral exploration, and, as
a result, there is a risk that we may incur liability or damages as
we conduct our business.
* The search for valuable minerals involves numerous hazards
and risks, such as cave-ins and pollution liability.
* We may be unable or unwilling to obtain insurance against
such hazards and risks. We currently have no insurance,
and we not expect to obtain any such insurance in the
foreseeable future.
* If we were to incur such a hazard or risk, the costs of
overcoming same may exceed our ability to do so, in which
event we could be required to liquidate all our assets and
you will lose your entire investment in the shares.
If our exploration program is able to confirm commercial
concentrations of gold on our Subject Claims, we are unable to
provide any assurance that we will be able to successfully place any
of the Subject Claims into commercial production.
<PAGE 15>
* Reports indicate that our Subject Claims contained
detectable levels of gold in the past.
* If our exploration programs are successful in confirming
deposits of commercial tonnage and grade, we will require
a joint venture partner or additional funds in order to
place the Subject Claims into commercial production.
* In such an event, we may be unable to locate a joint
venture partner or obtain any required funds, in which
event you may lose your entire investment in the shares.
Because access to our Subject Claims is often restricted by
inclement weather, we may be delayed in implementing or continuing
with our exploration, as well as, with any future mining efforts.
* Access to the Subject claims may be hindered during the
period between December and April of each year due to
inclement weather conditions in the area. As a result,
any attempts to visit, test, or explore the Subject Claims
are largely limited to a few months of the year when
weather permits such activities.
* These limitations can result in significant delays in our
exploration efforts, as well as, any mining and production
in the event that commercial amounts of minerals are
found. Such delays can result in our inability to meet
our obligations under the Option Agreement. Such failures
could cause our business to fail and you would lose the
entire investment in the shares.
As we undertake exploration of our Subject Claims, we will be
subject to compliance of government regulation that may increase the
anticipated time and cost of our exploration program.
* There is much governmental regulation that materially
affects the exploration of minerals. We will be subject
to the mining laws and regulations of the State of Montana
and the United States.
<PAGE 16>
* We may be required to obtain work permits, post bonds and
perform remediation work for any physical disturbance to
the land in order to comply with applicable law.
* Our planned exploration program budgets provide amounts
for anticipated regulatory compliance, however, there is a
risk that the amounts budgets may be inadequate due to
errors, omissions or additional regulations, any one of
which prevent us from carrying out our exploration program.
Market factors in the mining business are out of our control. As a
result, we may not be able to market any minerals that may be found.
* The mining industry, in general, is intensively
competitive, and we are unable to provide any assurance
that a ready market will exist of the sale of any gold,
even if we commercial quantities of gold are discovered
within the Subject Claims.
* Numerous factors beyond our control may affect the
marketability of any substances discovered. These factors
include market fluctuations, the proximity and capacity of
natural resource markets and processing equipment,
government regulations, including regulations relating to
prices, taxes, royalties, land tenure, land use, importing
and exporting of minerals and environmental protection.
* The exact effect of these factors cannot be accurately
predicted, but the impact or any one or a combination
thereof may result in our inability to generate any
revenue, in which event you will lose your entire
investment in the shares.
Our independent auditor has substantial doubt as to our ability to
continue as a going concern.
* Our financial statements have been prepared on the
assumption that we will continue as a going concern, but
if we fail to continue as a going concern, you will lose
your investment in the shares.
<PAGE 17>
* The report of our independent auditor refers to the
substantial doubt as to our ability to continue as a going
concern.
RISKS RELATED TO THIS OFFERING
We have arbitrarily determined the offering price of our shares and
you may never be able to recoup your investment in our shares.
* The public offering price for the shares was determined
solely by us and bears no relationship to our book value,
projected earnings, results of operations, net asset value
or any other objective criterion of value.
There has not been and may never be a viable public market for our
common stock, and if a viable public market does not develop, you
will not be able to sell your shares easily, if at all.
* There has not been a trading market for our shares, and we
cannot predict the extent to which investor interest in
our company will lead to the development of a trading
market for our shares or how liquid that market might be.
* If a trading market for our shares develops, the public
offering price for the shares may not be indicative of
prices that will prevail in such market. The market price
of our common stock, if any, may decline below the public
offering price.
If any of our shares were to become eligible for public sale after
this offering, same can be expected to adversely affect the price
that will prevail in the trading market, if one develops.
* If a public market develops for our common stock, sales of
significant amounts of our common stock in the public
market or the perception that such sales will occur could
materially adversely affect the market price of the common
stock or our ability to raise capital through future
offerings of equity securities.
<PAGE 18>
* None of the holders of our common stock have agreed, in
writing or otherwise, to refrain from publicly selling
their shares of our common stock when they are entitled to
do so.
Investors in the shares will incur substantial immediate dilution.
* The public offering price of the shares is substantially
higher than the net tangible book value per share of the
shares immediately after the offering.
* If you purchase our shares as part of this offering, you
will incur immediate dilution of approximately $4.64 per
share in the net tangible book value per share of common
stock from the price you paid for the shares if 35,000
shares are sold or $3.54 per share if 200,000 shares are
sold.
Our Board of Directors may issue shares of "blank check" preferred
stock which may result in substantial dilution to Investors.
* Without further action by the stockholders, our Board of
Directors can issue up to 500,000 shares of preferred
stock with such dividend rights, conversion rights, voting
rights, redemption rights, liquidation preferences and
other rights as may be determined appropriate by our Board
of Directors.
* If such preferred stock were issued, the holders of our
common stock could, among other things, experience
substantial dilution, and the voting power, dividend
receipt and liquidation rights of the common stock could
be adversely affected.
The interests of our controlling stockholders could conflict with
those of our other stockholders which could result in the loss of
your investment in our shares.
* Following completion of this offering, our present
shareholders will own or control more than a majority of
our outstanding common stock.
<PAGE 19>
* Our present shareholders may be able to influence the
outcome of shareholder votes, including votes concerning
the election of directors, amendments to our charter and
bylaws, and the approval of significant corporate
transactions such as a merger or sale of our assets. In
addition, that controlling influence could have the effect
of delaying, deferring or preventing a change in control
of our company.
We have never paid dividends to our shareholders, and we do not
anticipate that we will pay any dividends to our shareholders in the
foreseeable future.
* Our future policy on payment of dividends will be
determined by our Board of Directors based upon a
consideration of our earnings, if any, our future capital
needs and other relevant factors.
We have discretion in the application of proceeds of this offering.
* We have identified our intended uses for the net proceeds
of this offering, and we expect to apply the net proceeds
in the manner identified. Investors will, however, be
relying on our management's judgment in connection with
the ultimate application of those proceeds. Our failure
to apply our net proceeds effectively would hamper our
ability to succeed in the implementation of our business
plan and may cause you to lose your investment in our shares.
Anti-takeover provisions could hinder a potential third-party
acquisition.
* Our Board of Directors may, from time to time, adopt
certain provisions of the Florida Business Corporation
Act, which, if adopted, could delay, discourage or prevent
a change in control.
* Adoption of such provisions could discourage bids for our
common stock at a premium over the market price; could
adversely affect the market price, if any, of our common
stock; and could adversely affect the voting and other
rights of the holders of our common stock.
<PAGE 20>
FORWARD-LOOKING STATEMENTS
Many statements made or incorporated by reference in this prospectus
are "forward-looking statements". These forward-looking statements
include statements about:
* our ability to make an acquisition
* our capital needs
* the competitiveness of the business in our industry
* our strategies
* other statements that are not historical facts
When used in this prospectus, the words "anticipate," "believe,"
"expect," "estimate," "intend" and similar expressions are generally
intended to identify forward-looking statements. Because these
forward-looking statements involve risks and uncertainties, there
are important factors that could cause our actual results to differ
materially from those expressed or implied by these forward-looking
statements, including:
* changes in general economic and business conditions
* actions of our competitors
* the time and expense involved in development activities
* changes in our business strategies
* other factors discussed in the "Risk Factors" section and
elsewhere in this prospectus.
The forward-looking statements in this prospectus reflect what we
currently anticipate will happen. What actually happens could differ
materially from what we currently anticipate will happen. We are not
promising to make any public announcement when we think
forward-looking statements in this prospectus are no longer
accurate, whether as a result of new information, what actually
happens in the future or for any other reason.
<PAGE 21>
USE OF PROCEEDS
The proceeds we will receive will be $175,000
from the sale of 35,000 shares of our
common stock or $1,000,000 from the sale of 200,000 shares of our
common stock. We will not utilize any portion of the proceeds
unless we sell at least 35,000 shares. We intend to use the
proceeds from the sale of shares of our common stock in the order of
priority shown in the following table:
Amount if Amount if Amount if Amount if
35,000 70,000 140,000 200,000
shares are shares shares are shares are
sold are sold sold sold
Gross Proceeds $175,000 $350,000 $700,000 $1,000,000
Rehabilitate Adit $40,000 $40,000 $40,000 $40,000
Trenching, $12,000 $12,000 $12,000 $12,000
sampling,
analysis
Soils, analysis $4,000 $4,000 $4,000 $4,000
Survey $3,000 $3,000 $3,000 $3,000
Roads/Land $10,000 $10,000 $10,000 $10,000
Geologists $30,000 $40,000 $50,000 $60,000
Permitting and $10,000 $17,000 $20,000 $20,000
Bonding
Reserve for $2,000 $8,250 $8,250 $8,250
properties
Drilling $0 $125,000 $250,000 $300,000
Assessment of $0 $0 $50,000 $50,000
other properties
Acquisition of $0 $0 $100,000 $100,000
properties
<PAGE 22>
Exploration of $0 $0 $0 $195,000
other properties
Estimated $64,000 $64,000 $64,000 $64,000
offering expenses
General and $0 $26,750 $82,750 $112,750
administrative
expenses,
including legal
and accounting
fees and
administrative
support expenses
incurred in
connection with
our reporting
obligations to
the SEC
Contingencies $0 $0 $6,000 $21,000
Our officers and directors have verbally agreed to assume
responsibility for the expenses of the offering until such time, if
any, that funds are available to us from this offering. Our legal
fees in connection with this offering are expected to be $35,000.
We cannot now estimate our future legal fees.
In the event that we sell 35,0000 shares of our common stock, we
intend to complete Phase 1 of our exploration program, which
includes rehabilitation of adits, trenching, sampling, soil analysis
and surveying.
In the event we sell 70,000 shares of our common stock, we intend to
complete Phase 1 of our exploration program and commence a small
Phase 2 drilling program.
In the event we sell 140,000 shares of our common stock, we intend
to complete Phase 1 of our exploration program and undertake a large
<PAGE 23>
Phase 2 drilling program as well as an assessment and acquisition of
new properties.
In the event we sell 200,000 shares of our common stock, we intend
to complete Phase 1 and 2 of our exploration program, assess and
acquire new properties and commence the exploration of such new
properties.
Until the offering proceeds are utilized, we intend to invest the
proceeds received in one or more of the following:
* an obligation that constitutes a "deposit" as that term is
defined in section 3(1) of the Federal Deposit Insurance Act;
* securities of any qualifying money market mutual fund; or
* securities that are direct obligations of or obligations
guaranteed as to principal or interest by the United
States; provided the securities can be readily sold or
otherwise disposed of for cash at the time required
without any dissipation of offering proceeds invested.
DIVIDEND POLICY
We have never declared or paid any cash dividends
on our capital stock and do not anticipate
paying any cash dividends on our capital stock in the foreseeable
future. Future dividends, if any, will be determined by our Board
of Directors. In addition, we may incur indebtedness in the future
which may prohibit or effectively restrict the payment of dividends,
although we have no current plans to do so.
<PAGE 24>
DILUTION
Amount if Amount if
35,000 200,000
shares are shares are
sold sold
Net tangible deficit per share on $0.02 $0.02
September 30, 2005
Net tangible book value per share on
September 30, 2005 if the shares $0.30 $1.41
were sold on that date
Amount of increase in net tangible
book value per share attributable to $0.32 $1.43
cash payments made by purchasers of
the shares being offered
Amount of the immediate dilution
from the public offering price that $4.70 $3.59
will be absorbed by purchasers
Cash contribution of purchasers $175,000 $1,000,000
Cash contribution of officers, $50,000 $50,000
directors, founders and affiliates
Price per share paid by officers, $0.10 $0.10
directors, founders and affiliates
Price per share to be paid by $5.00 $5.00
purchasers of shares in this offering
The immediate and substantial dilution could adversely affect the
value of the shares.
MANAGEMENT'S PLAN OF OPERATION
The following plan of operation should be read in conjunction with
our financial statements and the related notes that appear elsewhere
<PAGE 25>
in this prospectus. The discussion contains forward-looking
statements that reflect our plans, estimates and beliefs. Our actual
results could differ materially from those discussed in the
forward-looking statements. Factors that could cause or contribute
to these differences include, but are not limited to, those
discussed below and elsewhere in this prospectus, particularly in
"Risk Factors."
Our objective is to be in the business of gold exploration. We
entered into a Mining Exploration and Option Agreement (the "Option
Agreement") with Hartmut W. and Inga M. Baitis (the "Claim Owner"),
which Option Agreement relates to six (6) unpatented mining claims,
Gold #1 through Gold #6 (collectively, the "Subject Claims") owned
by the Claim Owner within the Delmoe Lake Property in Jefferson
County, Montana (the "Property"). The Claim Owner is unrelated to us.
A memorandum of our Option Agreement has been recorded in the public
records of Jefferson County, Montana. Our Option Agreement grants
us a mining lease and provides us with an exclusive option to
purchase the Subject Property. The purchase price of the Subject
Property is $1,000,000, along with a 2% Net Smelter Return Royalty.
We made an initial payment of $7,500 upon execution of the Option
Agreement. An Additional payment of $7,500 is due on the first
anniversary date of the Option Agreement with additional payments of
$10,000 each due on each the next two subsequent anniversary date
and with additional payments of $15,000 each due on each subsequent
anniversary date until the Purchase Price is paid or the Option
Agreement is terminated or cancelled.
In addition to the payments we are required to pay to the Claim
Owner, we are required to pay $750.00 per annum to the United States
Department of the Interior, Bureau of Land Management in order to
retain the Subject Claims.
The 120 acre Delmoe Lake Property is located in southwest Montana
approximately 25 miles east of Butte in Sections 14 and 15, Township
3 North, Range 6 West, within the Homestake Mining District of
Jefferson County, Montana. The Delmoe Lake Property is located on
the southeast flank of the Boulder Batholith. A major
northeast-southwest trending lineament is immediately adjacent to
the mineralized area.
<PAGE 26>
Little information is available on the history of the Delmoe Lake
Property or surrounding area prior to 1981. In September of 1981,
Noranda Exploration Company conducted surface and underground chip
and channel sampling. Noranda sampling of narrow (2 to 3 feet)
quartz-pyrite veins showed high-grade results up to 0.612 oz/ton
gold. Under the supervision of the Claim Owner, 18 samples were
collected of which 5 were from underground workings. Independence
Mining carried out a sampling program in 1992 consisted of 17
samples. Their sampling confirmed the previous Noranda results.
The potential economic significance of the Subject Claims is based
upon the sampling results previously reported. The Subject Claims
have not yet been explored by us and until we are able to validate
otherwise, the Property is without known reserves.
The Property is accessed by 13 miles of improved and unimproved
gravel road off of Interstate Highway 90. Butte Montana, a major
regional center with a population of estimated 40,000 and a domestic
airport, is located approximately 25 miles to the west. A 2 mile
4-wheel drive road would be used to access the Property from Delmoe
Lake, but such road will require work to provide access for heavy
equipment.
Infrastructure in the region around the Property appears to be good
with nearby power, phone, services, hotels, restaurants, housing and
an extensive pool of skilled labor. Cellular service is available
at the Property. The Property is at an altitude of between 6,600 and
7,200 feet and consists of mountainous terrain dropping
south-westward into the Delmoe Lake basin. The area is forested
predominately by lodge pole pine. Weather conditions include
snowfalls as early as September until as late as early June.
Average precipitation is estimated at 25 inches per annum.
Temperatures range from -50O F in January to +80O F in July.
We are an exploration stage company and there is no assurance that
commercially viable gold-bearing mineral deposits exist on any of
the Subject Claims. Our objective is to conduct a two phase
exploration program on the Subject Claims to assess whether they
possess any commercially viable gold-bearing mineral deposits.
Although certain historical data reports the presence of
gold-bearing mineral deposits, we cannot provide any assurance that
the Subject Claims will prove commercially viable.
Our plan is to complete the first phase of our exploration program
<PAGE 27>
in order to confirm historical reports about our claims. We
anticipate that the cost to undertake Phase 1 of our exploration
program is approximately $140,000.00. We anticipate that the work
included as part of Phase 1 of our exploration program will include
surface geologic mapping, sampling, survey control, road
rehabilitation, adit rehabilitation and trenching with subsequent
mapping, sampling and analysis, soil survey, permitting and bonding.
If Phase 1 of our exploration program is successful, we expect to
proceed with a second Phase of our exploration program. Phase 2 of
our exploration program is expected to include further excavation,
drilling and engineering studies, and is expected to cost us
approximately $250,000.00. Until we have completed Phase 2 of our
exploration program, we can not determine if commercially viable
gold deposits exist within the Subject Claims. If we receive at
least the minimum proceeds of our offering, we will have adequate
funds to complete Phase 1 of our exploration program, but we will
not have sufficient funds to proceed with Phase 2 of our exploration
program. If we receive the maximum proceeds of our offering we will
have sufficient funds to complete Phase 2 of our exploration
program.
Depending upon the receipt of proceeds of our offering and
permissible weather conditions, we expect to commence Phase 1 of our
exploration program during the month of June of the calendar year
2006 and we anticipate that Phase 1 will be concluded within three
months after commencement. Until we complete Phase 1 of our
exploration program, we are unable to determine when or if Phase 2
of our exploration program would commence. Should we undertake
Phase 1 of our exploration program and if the results thereof do not
confirm historical results, we anticipate that we will not terminate
the Option Agreement and hope for higher gold prices, provided that
we have adequate funds to do so. Additionally, if Phase 1 of our
exploration program does not produce favorable results, we intend to
acquire new claims for exploration, if we have the adequate funds to
do so.
To date our founders, Arnold T. Kondrat and Lloyd J. Bardswich have
contributed an aggregate of $50,000 to our capital in exchange for
which we have issued 450,000 and 50,000 shares of our common stock,
respectively to such parties.
<PAGE 28>
Since our inception, we have not generated any revenues, and we have
incurred losses. We have not yet commenced operations, and our
auditors have, as part of their report on our financial statements,
included a "going concern opinion". Currently, we are entirely
reliant upon receipt of at least the minimum proceeds of our
offering to commence our proposed operations.
As of September 30, 2005, we had cash on hand in the amount of
$19,365.
Assuming that we do not receive any proceeds from the sale of our
shares from this offering, we anticipate that we will continue
undertaking the activities similar to those very limited activities
that we have undertaken from our inception. In that event, we
believe that our cash requirements for the next twelve months would
be approximately $50,000. If we do not receive any proceeds from
the sale of our shares from this offering, we believe that our
shareholders may be willing to loan or otherwise provide us
sufficient funds to enable us to continue to operate for the next
twelve months. We are not certain, however, that our shareholders
will agree to loan or otherwise provide such funds to us, and if
such funds are loaned or otherwise provided, we are not certain of
the terms associated therewith. Other than funds from our
shareholders, we are unable to determine whether any other source of
funds may be available to us to allow us to obtain the amounts
necessary to sustain our operations for the next twelve months
without the receipt of proceeds from the sale of our shares from
this offering. If, we do not receive any proceeds from the sale of
our shares from this offering and if the funds we require are not
available when we need them from other sources, we may be forced to
terminate our business. We have not made any determination as to
what we would do if we were required to terminate our business
operations, and we have not entered into nor does we presently
intend to enter into any negotiations, understandings, or
agreements, preliminary or otherwise, to acquire or be acquired in a
merger or reverse acquisition.
We have not had any revenues since inception, and our ability to
continue as a going concern is dependent upon receipt of sufficient
proceeds from this offering and shareholder loans. If we do not
obtain sufficient proceeds from this offering or from loans from our
shareholders, we will exhaust our limited financial resources before
<PAGE 29>
our business objectives can be accomplished. Although certain of
our shareholders have indicated a willingness to provide limited
amounts of shareholder loans, none of our shareholders have given us
any binding commitment to provide any such shareholder loan or any
amount thereof, and we can provide no assurance that we will be able
to obtain a shareholder loan when and if funds are needed.
Until we receive proceeds from this offering, we intend to continue
undertaking activities similar to those very limited activities that
we have undertaken since our inception. From inception we
negotiated and concluded the Option Agreement and we engaged Roscoe
Postle Associates, Inc. to prepare a technical report on the Delmoe
Lake Property.
If we receive the proceeds of the sale of the minimum number of our
shares from this offering, we expect that we will only be able to
continue undertaking activities similar to those very limited
activities we have undertaken since our inception, namely,
refinement of our business plan and to undertake our Phase 1
exploration program in accordance with the budget proposed therefor.
If we are able to sell at least fifty percent of the shares we are
offering in connection with this offering, we anticipate that if the
results of our Phase 1 exploration program so warrant, we will
undertake our Phase 2 exploration program.
If we are able to sell at all of the shares we are offering in
connection with this offering, we anticipate that in addition to the
foregoing we will undertake to assess and acquire additional
properties and commence exploration on new properties.
If we sell less than the maximum amount of our shares offered in
connection with this offering, we may not have sufficient funds to
complete any or all of our objectives described above, and we
anticipate that our operations, if any, related to these activities
may be hampered by our limited resources.
Furthermore, we can provide no assurance that the accomplishment by
us of less than all of our objectives will produce any meaningful
benefit for us. In that regard, if we are only partially able to
meet our objectives, we may not have a viable business and we may be
forced to terminate our operations. Likewise, to the extent that we
<PAGE 30>
require funds in excess of the amounts we have anticipated, we may
not be able to obtain such funds and we may be forced to terminate
our business.
Other than the foregoing, we do not expect to purchase or sell any
significant equipment and do not expect any significant changes in
the number of our employees.
PROPOSED BUSINESS
Background
We are a Florida corporation formed under the name of Gentor
Resources, Inc. on March 24, 2005.
Our objective is to be in the business of gold exploration. We
entered into a Mining Exploration and Option Agreement (the "Option
Agreement") with Hartmut W. and Inga M. Baitis (the "Claim Owner"),
which Option Agreement relates to six (6) unpatented mining claims,
Gold #1 through Gold #6 (collectively, the "Subject Claims") owned
by the Claim Owner within the Delmoe Lake Property in Jefferson
County, Montana (the "Property"). The Claim Owner is unrelated to us.
We are an exploration stage company and there is no assurance that
commercially viable gold-bearing mineral deposits exist on any of
the Subject Claims. Our objective is to conduct a two Phase
exploration program on the Subject Claims to assess whether they
possess any commercially viable gold-bearing mineral deposits.
Although certain historical data reports the presence of
gold-bearing mineral deposits, we cannot provide any assurance that
the Subject Claims will prove commercially viable.
Our plan is to complete the first Phase of our exploration program
in order to confirm historical reports about our claims. We
anticipate that the cost to undertake Phase 1 of our exploration
program is approximately $140,000.00. We anticipate that the work
included as part of Phase 1 of our exploration program will include
surface geologic mapping, sampling, survey control, road
rehabilitation, adit rehabilitation and trenching with subsequent
mapping, sampling and analysis, soil survey, permitting and bonding.
If Phase 1 of our exploration program is successful, we expect to
<PAGE 31>
proceed with a second Phase of our exploration program. Phase 2 of
our exploration program is expected to include further excavation,
drilling and engineering studies, and is expected to cost us
approximately $250,000.00. Until we have completed Phase 2 of our
exploration program, we can not determine if commercially viable
gold deposits exist within the Subject Claims. If we receive at
least the minimum proceeds of our offering, we will have adequate
funds to complete Phase 1 of our exploration program, but we will
not have sufficient funds to proceed with Phase 2 of our exploration
program. If we receive the maximum proceeds of our offering we will
have sufficient funds to complete Phase 2 of our exploration
program.
Depending upon the receipt of proceeds of our offering and
permissible weather conditions, we expect to commence Phase 1 of our
exploration program during the month of June of the calendar year
2006 and we anticipate that Phase 1 will be concluded within three
months after commencement. Until we complete Phase 1 of our
exploration program, we are unable to determine when or if Phase 2
of our exploration program would commence. Should we undertake
Phase 1 of our exploration program and if the results thereof do not
confirm historical results, we anticipate that we will not terminate
the Option Agreement and hope for higher gold prices, provided that
we have adequate funds to do so. Additionally, if Phase 1 of our
exploration program does not produce favorable results, we intend to
acquire new claims for exploration, if we have the adequate funds to
do so.
Future Plans
We intend to search for additional properties of merit and, upon
identification thereof, we intend to pursue the acquisition thereof
so long as any such identified property can be acquired at a cost
deemed by us to be reasonable and provided that the anticipated
costs of development and exploration of such properties can be
undertaken at a relatively low cost. We anticipate that as to any
such property of merit so identified, that we will seek to undertake
its development, independently or pursuant to a joint venture with
others, or resell same.
<PAGE 32>
Agreements
The Option Agreement
Our entire business plan is based upon the Option Agreement The
Option Agreement is dated April 29, 2005 and a memorandum of our
Option Agreement has been recorded in the public records of
Jefferson County, Montana. Our Option Agreement grants us a mining
lease and provides us with an exclusive option to purchase the
Subject Property. The purchase price of the Subject Property is
$1,000,000, along with a 2% Net Smelter Return Royalty. We made an
initial payment of $7,500 upon execution of the Option Agreement.
An Additional payment of $7,500 is due on the first anniversary date
of the Option Agreement with additional payments of $10,000 each due
on each the next two subsequent anniversary date and with additional
payments of $15,000 each due on each subsequent anniversary date
until the Purchase Price is paid or the Option Agreement is
terminated or cancelled. We have attached the Option Agreement and
the Memorandum thereof as an exhibit to this prospectus.
Report on the Delmoe Lake Property
We engaged Roscoe Postle Associates, Inc. ("RPA") to prepare a
technical report on the Delmoe Lake Property for us in conformity
with Security Exchange Commission guidelines for a description of
property by issuers engaged or to be engaged in significant mining
operations. Nathan Eric Fier, CPG, P.Eng., a Consulting Geologist
and Mining Engineer associated with RPA, is the author of the
technical report.
A summary of the information included as part of the technical
report is as follows:
The 120 acre Delmoe Lake Property is located in southwest Montana
approximately 25 miles east of Butte in Sections 14 and 15, T3N, R6W
in the Homestake Mining District, Jefferson County.
Little information is available on the history of the Delmoe Lake
property or surrounding area prior to 1981. In 1962, W.D. Mateer
(Geologist) examined the property and collected 3 samples. These
samples showed anomalous gold and silver values with dump grades
assaying 0.46 oz/ton Au, 1.76 oz/ton Ag and 0.56 oz/ton Au, 2.02
oz/ton Ag. In 1970, an adit (location unknown) was rehabilitated
<PAGE 33>
and a single sample across the floor of the adit assayed 1.26 oz/ton
Au, trace Ag and 94% Si.
The Delmoe Lake property is located on the southeast flank of the
Boulder Batholith. A major northeast-southwest trending lineament is
immediately adjacent to the mineralized area. This lineament system
appears to be a main controlling trend for mineralization in Montana
and Idaho.
A series of quartz veins can be traced on surface for a distance of
approximately 4,000 feet. The host rock is a massive quartz
monzonite to granodiorite. Alteration is minimal with minor
bleaching and silicification of the wallrocks adjacent to
mineralized veins.
In September of 1981, Noranda Exploration Company conducted surface
and underground chip and channel sampling in the old adit. Noranda
sampling of narrow (2 to 3 feet) quartz-pyrite veins showed
high-grade results up to 0.612 oz/ton gold. Under the supervision of
Hart Baitis (the current owner), 18 samples were collected of which
5 were from underground workings. Independence Mining carried out a
sampling program in 1992 consisted of 17 samples. Their sampling
confirmed the previous Noranda results. The U.S. Geological Survey
completed an aeromagnetic geophysical survey for southwest Montana
in 1964-65.
The property is considered to be at the grass-roots exploration
stage. The proposed Phase 1 budget for Delmoe Lake is based on
defining drill targets with an expenditure of $134,000. Work should
include surface geologic mapping, sampling, survey control, road
rehabilitation, adit rehabilitation, trenching with subsequent
mapping, sampling and analysis, soil survey, permitting and bonding
for the work program. Contingent upon the successful completion of
the Phase 1 program, a Phase 2 program may be warranted at an
estimated cost of $250,000.
We have attached a copy of the technical report to this prospectus.
Employees
We currently have no full-time employees. Our only employees are,
Lloyd J. Bardswich (Joe) who serves as a director, our president,
treasurer; Kitt M. Dale who serves as a director; and Samuel Lee
<PAGE 34>
Henry who serves as a director and our secretary and will also serve
as our project supervisor for construction.
We expect that Mr. Bardswich will spend as much as 20 hours each
week in attending to our business affairs, but Mr. Bardswich is not
obligated to do so. We expect that Mr. Bardswich will also be
engaged as a consultant to third-party companies engaged in mining
businesses that may be competitive to us and that he will devote
such portion of his time to such other activities as he may deem
necessary. We believe that the time Mr. Bardswich intends to devote
to our business affairs, along with the time to be provided to us by
our other employees, will initially be adequate for us to implement
our plan of operations. As our business develops and as our
financial resources permit, we intend to hire such additional staff
as may be necessary to further develop and implement our plan of
operations.
We expect that Mr. Dale will spend as much as 5 hours each week in
attending to our business affairs, but Mr. Dale is not obligated to
do so. We expect that Mr. Dale will also be engaged as a consultant
to third-party companies engaged in mining businesses that may be
competitive to us and that he will devote such portion of his time
to such other activities as he may deem necessary.
We expect that Mr. Henry will spend as much as 5 hours each week in
attending to our business affairs, but Mr. Henry is not obligated to
do so. We expect that Mr. Henry will also be engaged as a
consultant to third-party companies engaged in mining businesses
that may be competitive to us and that he will devote such portion
of his time to such other activities as he may deem necessary.
Facilities
The Company's principal executive offices are located at 1 Alder
Gulch Road, Virginia City, Montana 59755; telephone (406)843-5383.
MANAGEMENT
Executive Officers and Directors
The following sets forth certain information with respect to our
<PAGE 35>
executive officers and directors. Each director holds such position
until the next annual meeting of our shareholders and until his
respective successor has been elected and qualifies.
Name Age Positions
Lloyd J. 60 Director, President, Treasurer and
Bardswich Chief Financial Officer
Kitt M. Dale 45 Director
Samuel L. Henry 32 Director and Secretary
Any of our directors may be removed with or without cause at any
time by the vote of the holders of not less than a majority of our
then outstanding common stock. Officers are elected annually by the
Board of Directors. Any of our officers may be removed with or
without cause at any time by our Board of Directors.
Mr. Bardswich is one of our founders and has held his positions with
us since our inception.
Mr. Bardswich is one of our Directors and serves as our corporate
President, our Treasurer and our Chief Financial Officer.
Mr. Bardswich holds a B.A. Sc. from the University of Windsor,
Ontario Canada and a M.Eng (Mining) degree from McGill University,
Montreal Canada. For the past five (5) years, Mr. Bardswich has
been the president and general manager of Madison Mining
Corporation, a private Montana corporation, served as an independent
mining consultant for a variety of private clients in the United
States, Canada, and Africa, and has been the president and director
of BRC Diamond Corporation, a publicly held company that trades on
the Toronto Venture Exchange under the symbol "BRC." In December
2004, Mr. Bardswich became a director of United Bolero Development,
a publicly held company that trades on the Toronto Venture Exchange
under the symbol "UNB."
Mr. Bardswich does not devote his entire time to us. He does intend
to regularly to discuss our affairs and to review the status of our
business operations. We anticipate that Mr. Bardswich will devote
up to 20 hours per weeks to our business affairs. Any conflicts of
interest that arise affecting Mr. Bardswich and us will be resolved
<PAGE 36>
by him in a manner that he deems will be fair. You may not agree
with his determination. If you have any doubt about the abilities
or integrity of Mr. Bardswich, you should not purchase any shares.
Mr. Dale is one of our Directors
Kitt M. Dale holds a Bachelors of Science (Mining Engineering) from
Montana College of Mineral Science and Technology, Butte, Montana.
For the past five (5) years, Mr. Dale has been the owner and
operator of Indian Hay Ranch located in Sheridan, Montana, has
served as an consulting mining engineer for M3 Engineering and
Technology Group, Inc., and has served as a Maintenance and
Operations Support Specialist for Barrick Gold, Kennecott Utah
Copper Company, and the Ascentis Operations Company.
Mr. Dale does not devote his entire time to us. He does intend to
regularly to discuss our affairs and to review the status of our
business operations with Mr. Bardswich and Mr. Henry. We anticipate
that Mr. Dale will devote up to 5 hours per weeks to our business
affairs. If you have any doubt about the abilities or integrity of
Mr. Dale, you should not purchase any shares.
Mr. Henry is one of our Directors and serves as our corporate
Secretary.
Mr. Henry holds an Associates degree in Business from the University
of Montana, Western in Dillon, Montana. For the past five (5)
years, Mr. Henry has been a construction supervisor for 3 Rivers
Communication located in Ennis, Montana, a project supervisor for
ORO Management at its Brown's Gulch Mining Operation located in
Nevada City Montana, and a project supervisor with Moen Builders and
M&W Milling and Refining located in Virginia City, Montana.
Mr. Henry does not devote his entire time to us. He does intend to
regularly to discuss our affairs and to review the status of our
business operations with Mr. Bardswich and Mr. Dale. We anticipate
that Mr. Henry will devote up to 5 hours per weeks to our business
affairs. If you have any doubt about the abilities or integrity of
<PAGE 37>
Mr. Henry, you should not purchase any shares.
Executive Compensation of our Executive Officers
We have no agreements relating to compensation with Mr. Bardswich,
with Mr. Dale or with Mr. Henry. We have in the past, and
anticipate that we will in the future, compensate Mr. Bardswich, Mr.
Dale and Mr. Henry on a consulting basis in accordance with industry
standard rates for the work provided. The compensation of our
executive officers will be determined by our Board of Directors.
Our executive officers have verbally agreed to defer the payment of
any compensation from us as an executive officer until such time, if
any, that we obtain sufficient capital through this offering or
otherwise. We do not presently intend to use any of the proceeds of
this offering to compensate our executive officers, except that we
intend to reimburse our executive officers for any expenses of the
offering paid by them, if any.
We do not have any written procedures in place to address conflicts
of interest that may arise as a result of the their outside business
interests. Any such conflicts of interest that arise will be
resolved by him in a manner that he deems will be fair. You may not
agree with his determination. If you have any doubt about the
abilities or integrity of Mr. Bardswich, you should not purchase any
shares.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of September 30, 2005, there are 2 holders of record of our
common stock. The following table sets forth certain information as
of September 30, 2005 with respect to any person who is known to us
to be the beneficial owner of more than 5% of our common stock,
which is the only class of our outstanding voting securities and as
to each class of our equity securities beneficially owned by our
directors and officers and directors as a group:
Name of Beneficial Owner Amount of Shares Approximate
Beneficially Percent of
Owned Class
<PAGE 38>
Arnold T. Kondrat 450,000 90.0%
1 First Canadian Place
Suite 7070
Toronto, Ontario M5X 1E3
Canada
Lloyd J. Bardswich 50,000 10.0%
1 Alder Gulch Road
Virginia City, Montana 59755
Officers and Directors as a 50,000 10.0%
Group (1 person)
CERTAIN TRANSACTIONS
On formation, we issued an aggregate of 500,000 shares of our common
stock to 2 founders, all of whom are, pursuant to the provisions of
Rule 405 of Regulation C under the Securities Act, are deemed to be
organizers of the Company since at inception, each of such
shareholders received in excess of ten (10%) percent of the common
stock of the Company. At the time of the issuance of our shares,
our founders paid $50,000 for the shares.
DESCRIPTION OF COMMON STOCK
Our authorized capital stock consists of 1,500,000
shares of common stock, par
value $.0001 per share, and 500,000 shares of preferred stock, par
value $.0001 per share.
The holders of outstanding shares of our common stock are entitled
to receive dividends out of assets legally available therefor at
such times and in such amounts, if any, as our Board of Directors
from time to time may determine. Holders of common stock are
entitled to one vote for each share held on all matters submitted to
a vote of stockholders, which means that the holders of a majority
of the shares voted can elect all of the directors then standing for
election. Holders of the common stock are not entitled to
preemptive rights, and the common stock is not subject to conversion
or redemption.
<PAGE 39>
The holders of our securities described under the caption "Security
Ownership of Certain Beneficial Owners and Management", above, one
of which is one of our director and an executive officer, own all of
our outstanding common stock. These stockholders can determine the
outcome of stockholder votes, including votes concerning the
election of directors, amendments to our charter and bylaws, and the
approval of significant corporate transactions such as a merger or
sale of our assets. In addition, their controlling influence could
have the effect of delaying, deferring or preventing a change in
control of our company.
Our preferred stock may be issued from time to time in one or more
series, and each of such series will have distinctive serial
designations in such manner as is determined by our Board of Directors.
Each series of preferred stock may be of such number of shares and
may have such rights and preferences, including but not limited to
special voting rights, redemption rights, conversion rights,
dividend rights, liquidation rights, other relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions, as may be stated in the resolution of our Board of
Directors providing for the issuance of such preferred stock.
Control-Share Acquisitions and Affiliated Transactions
We may become subject to the control-share acquisition and
affiliated transaction provisions of the Florida Business
Corporation Act. Those provisions could have the effect of
discouraging offers to acquire us and of increasing the difficulty
of consummating any such offer. Those provisions may also
discourage bids for our common stock at a premium over the market
price.
Transfer Agent
We intend to engage Florida Atlantic Stock Transfer Company, Inc.,
7130 Nob Hill Road, Tamarac, FL 33321 whose telephone number is
(954)726-4954 as the transfer agent for our common stock.
<PAGE 40>
SHARES ELIGIBLE FOR FUTURE SALE
Prior to this offering, there has not been
any public market for our common stock.
Sales of substantial amounts of our common stock in the public
market, or the perception that such sales could occur, could
adversely affect prevailing market prices, if any, of our common
stock and could impair our future ability to raise capital through
the sale of equity securities.
In general, under Rule 144, any person who owns shares that were
acquired from us at least one year prior to the proposed sale is
entitled to sell, within any three-month period beginning 90 days
after the date of this prospectus, a number of shares that does not
exceed the greater of:
* 1% of the number of shares of our common stock then
outstanding or
* the average weekly trading volume of the common stock on
Nasdaq during the four calendar weeks preceding the filing
of a notice on Form 144 with respect to such sale.
Shares that were acquired from us at least two years prior to the
proposed sale may generally be sold by non-affiliates without
restriction. Any shares purchased by our affiliates in this
offering and subsequently publicly sold by those affiliates will not
be subject to the one-year holding period. Sales under Rule 144 are
also subject to a certain manner of sale provisions and notice
requirements and to the availability of current public information
about us.
PLAN OF DISTRIBUTION
Our Offering
We are offering 200,000 shares on a "best efforts" basis. Unless we
receive paid subscriptions for at least 35,000 shares by May 31,
2006, no shares will be sold and all proceeds will be returned to
subscribers without interest. If we sell at least 35,000 shares by
that date, we may extend our offering until the earlier of September
30, 2006 or such time that all 200,000 shares are sold. The minimum
<PAGE 41>
purchase is 1,000 shares. There is no limit on the number of shares
that may be purchased by any of our founders. Any purchases by them
must be made with investment intent and made on the same terms and
conditions as are purchases made by public investors.
We are making the offering through our President, who will not be
compensated for offering the shares. However, subject to the
limitation described under "Use of Proceeds," we will reimburse him
for all expenses incurred by him in connection with the offering.
Because we are offering the shares through our President without the
use of a professional securities underwriting firm, there may be
less due diligence performed in conjunction with this offering than
would be performed in the event of an underwritten offering.
Prior to this offering, there has been no market for our common
stock. The public offering price for the shares was determined
solely by us and may be substantially higher than the prices that
will prevail in the trading market, if one develops. Among the
factors we considered in determining the public offering price were
the absence of a record of operations, our current financial
condition, our future prospects, the inexperience of our management,
and the general condition of the equity securities market.
We initially intend to offer our shares in the states of Florida and
New York, although we may expand our offering to other states.
If a public market develops for our common stock, trading in the
common stock may be subject to the requirements of applicable rules
under the Securities Exchange Act of 1934, which require additional
disclosure by broker-dealers in connection with any trades involving
the common stock. Those rules require the delivery, prior to any
transaction in the common stock, of a disclosure schedule explaining
the penny stock market and associated risks, and impose various
sales practice requirements on broker-dealers who sell the common
stock to persons other than established customers and accredited
investors (generally institutions). For these types of transactions,
the broker-dealer must make a special suitability determination for
the purchaser and have received the purchaser's written consent to
the transaction prior to sale. The additional burdens imposed upon
<PAGE 42>
broker-dealers may discourage broker-dealers from effecting
transactions in our common stock, which could severely limit its
liquidity.
LEGAL PROCEEDINGS
There are no pending or threatened legal proceedings to which we are
a party or of which any of our property is the subject, or to our
knowledge, any proceedings contemplated by governmental authorities.
INDEMNIFICATION
We have agreed to indemnify our executive officers and directors to
the fullest extent permitted by the Florida Business Corporation
Act. The Act permits us to indemnify any person who is or is
threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by us or in
our right) by reason of the fact that the person is or was an
officer or director or is or was serving at our request as an
officer or director. The indemnity may include expenses (including
attorney's fees), judgments, fines and amounts paid in settlement
that were actually and reasonably incurred by the person in
connection with the action, suit or proceeding; provided, however,
that the person acted in good faith and in a manner such person
reasonably believed to be in or not opposed to our best interests,
and with respect to any criminal action or proceeding, had no
reasonable cause to believe such person's conduct was unlawful. We
may indemnify officers and directors in an action by us or in our
right under the same conditions, except that no indemnification is
permitted without judicial approval if the officer or director is
adjudged to be liable to us. Where an officer or director is
successful on the merits or otherwise in the defense of any action
referred to above, we must indemnify such officer or director
against the expenses which such officer or director actually and
reasonably incurred. The indemnification provisions of the Florida
Business Corporation Act are not exclusive of any other rights to
which an officer or director may be entitled under our bylaws, by
agreement, vote or otherwise.
<PAGE 43>
Insofar as indemnification arising under the Securities Act may be
permitted to our directors, officers and controlling persons
pursuant to the foregoing provisions or otherwise, we have been
advised that, in the opinion of the SEC, such indemnification is
against public policy as expressed in the Securities Act and is
therefore unenforceable.
LEGAL MATTERS
The validity of the shares of common stock offered by this
prospectus have been passed upon for us by Edward H. Gilbert, P.A.
to the extent set forth in that firm's opinion filed as an exhibit
to the registration statement. Edward H. Gilbert is the sole owner
of Edward H. Gilbert, P.A. Neither Mr. Gilbert nor Edward H.
Gilbert, P.A. currently owns any of our shares, but may be entitled
to a yet undetermined amount of same. Mr. Gilbert is not one of our
officers, nor is he a director.
EXPERTS
The financial statements included in this Prospectus and in the
Registration Statement have been audited by BDO Dunwoody LLP, an
independent registered public accounting firm, to the extent and for
the period set forth in their report appearing elsewhere herein and
in the Registration Statement, and are included in reliance upon
such report given upon the authority of said firm as experts in
accounting and auditing.
ADDITIONAL INFORMATION
We have electronically filed a registration statement on Form SB-2
with the SEC with respect to the shares of common stock to be sold
in this offering. This prospectus, which forms a part of that
registration statement, does not contain all of the information
included in the registration statement. Certain information is
omitted and you should refer to the registration statement and its
exhibits. With respect to references made in this prospectus to any
<PAGE 44>
contract or other document, the references are not necessarily
complete and you should refer to the exhibits attached to the
registration statement for copies of the actual contract or
document. You may read the registration statement and other
materials we file with the SEC at the Public Reference Section of
the SEC at Room 1580, 100 F Street, N.E., Washington, D.C. 20549.
Copies of the registration statement and other materials we file
with the SEC may be obtained from the Public Reference Section upon
payment of the prescribed fees therefor. The public may obtain
information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that
contains reports, proxy statements and information statements, and
other information regarding issuers that file electronically with
the SEC. The address of that site is http://www.sec.gov.
Upon the effectiveness of the registration statement of which this
Prospectus is a part, we will become subject to the information and
reporting requirements of the Securities Exchange Act of 1934 and
will file periodic reports and other information with the SEC.
We intend to furnish our stockholders with annual reports containing
audited financial statements.
<PAGE 45>
GENTOR RESOURCES, INC.
FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
<PAGE 46>
GENTOR RESOURCES, INC.
CONTENTS
Page(s)
Report of Independent Auditor 48
Balance Sheet 50
Statements of Operations and Deficit 52
Statement of Cash Flows 54
Notes to Financial Statements 56
<PAGE 47>
Report of Independent Registered Public Accounting Firm
To the Directors and Shareholders of
Gentor Resources, Inc.
(An Exploration Stage Company)
We have audited the balance sheet of Gentor Resources, Inc. (an
exploration stage company) as at September 30, 2005, and the
statements of operations and deficit and cash flows for the period
March 24, 2005 (date of inception) to September 30, 2005. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
of material misstatement. The Company is not required to have, nor
were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the
Company's internal control over financial reporting. Accordingly,
we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements and assessing the accounting principles used
and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, based on our audit, these financial statements
present fairly, in all material respects, the financial position of
Gentor Resources, Inc. (an exploration state company) as at
September 30, 2005 and the results of its operations and cash flows
for the period from March 24, 2005 (date of inception) to September
30, 2005 in conformity with United States generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming
<PAGE 48>
that the Company will continue as a going concern. As discussed in
Note 1 to the financial statements, the Company has a net loss of
$62,238 and an accumulated deficit of $62,238 for the period ended
September 30, 2005. These matters raise substantial doubt about the
Company's ability to continue as a going concern. Management's
plans regarding these matters are also described in Note 1. The
accompanying financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
BDO Dunwoody LLP
Chartered Accountants
Toronto, Ontario
October 31, 2005
<PAGE 49>
GENTOR RESOURCES, INC.
(AN EXPLORATION STAGE CORPORATION)
BALANCE SHEET
(STATED IN US DOLLARS)
AS AT SEPTEMBER 30, 2005
ASSETS
CURRENT
Cash & cash equivalents (note 3) $19,365
------------
TOTAL CURRENT ASSETS $19,365
============
LIABILITIES
CURRENT
Accounts payable and accrued liabilities $31,703
------------
TOTAL CURRENT LIABILITIES $31,703
SHAREHOLDERS' DEFICIT
Authorized
1,500,000 Common shares, $0.0001 par value
500,000 Preferred shares, $0.0001 par value
Issued and outstanding
<PAGE 50>
500,000 common shares (note 5) 50
Paid-in capital 49,950
Deficit accumulated during exploration stage (62,338)
------------
Shareholder Equity (Deficiency) ($12,338)
------------
TOTAL LIABILITIES AND SHAREHOLDER DEFICIT $19,365
============
See accompanying summary of accounting policies and notes to
financial statements.
<PAGE 51>
GENTOR RESOURCES, INC.
(AN EXPLORATION STAGE CORPORATION
STATEMENTS OF OPERATIONS AND DEFICIT
(STATED IN US DOLLARS)
FOR THE PERIOD MARCH 24, 2005 (INCEPTION)
THROUGH SEPTEMBER 30, 2005
EXPENSES
Mineral Properties $7,500
Consulting fees - related parties 7,400
Consulting fees - others 4,409
Legal, accounting and auditing fees 41,703
General and administrative expenses 1,432
-----------
(62,444)
Interest income 106
-----------
NET LOSS (62,338)
DEFICIT, BEGINNING OF THE PERIOD -
-----------
DEFICIT, END OF PERIOD $(62,338)
===========
<PAGE 52>
Basic and diluted loss per common share (0.12)
Weighted aver number of shares 500,000
See accompanying summary of accounting policies and notes to
financial statements.
<PAGE 53>
GENTOR RESOURCES, INC.
(AN EXPLORATION STAGE CORPORATION
STATEMENTS OF CASH FLOWS
(STATED IN US DOLLARS)
FOR THE PERIOD MARCH 24, 2005 (INCEPTION)
THROUGH SEPTEMBER 30, 2005
CASH PROVIDED BY (APPLIED TO):
OPERATING ACTIVITIES:
Adjustments required to reconcile net loss with
net cash used in operating activities
Net loss for the period $(62,338)
CHANGE IN NON CASH WORKING CAPITAL BALANCE
Accounts payable and accrued liabilities (31,703)
-----------
(30,635)
INVESTING ACTIVITIES:
FINANCING ACTIVITIES:
Common shares issued 50,000
-----------
NET INCREASE IN CASH & EQUIVALENTS $19,365
===========
<PAGE 54>
SUPPLEMENTARY CASH FLOW INFORMATION
-----------
CASH RECEIVED FOR INTEREST $106
===========
See accompanying summary of accounting policies and notes to
financial statements.
<PAGE 55>
GENTOR RESOURCES, INC.
(AN EXPLORATION STAGE CORPORATION)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2005
1. ORGANIZATION AND GOING CONCERN
Gentor Resources, Inc. ("the Company") was incorporated on March 24,
2005 under the Florida Business Corporation Act. The Company is an
exploration stage corporation formed for the purpose of prospecting
and developing mineral properties. During the period, the company
purchased option agreements to acquire exclusive gold exploration,
prospecting and development rights and privileges to six (6)
unpatented mining claims ("the Mining Claims"), located in the
Jefferson County, State of Montana. To date, the Company's
activities have been limited to its formation and the raising of
equity capital. At present, management is devoting most of its
activities to getting an SB-2 Registration Statement declared
effective.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern, which
contemplates, the realization of assets and satisfaction of
liabilities in the normal course of business. As at September 30,
2005, the Company has a loss from operations of $62,338 and
accumulated deficit of $62,338. The Company intends to fund
operations through equity financing arrangements, which may be
insufficient to fund its capital expenditure, working capital and
other cash requirements for the year ending September 30, 2006.
The Company's continued existence is dependent upon it emerging from
the exploration stage, obtaining additional financing to continue
operations, explore and develop the mining properties and the
discovery, development and sale of ore reserves.
The Company plans to apply for an SB-2 Registration Statement and
intends to raise additional funding through public or private place
offerings. Funding may not be available at all or at terms that are
acceptable to the Company.
<PAGE 56>
The financial statements do not include any adjustments to reflect
the possible future effects on the recoverability and classification
of assets or the amounts and classification of liabilities that may
result from the possible inability of the company to continue as a
going concern.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a) CASH AND CASH EQUIVALENTS
Cash and equivalents consist of bank balances and other short
term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant
risk of changes in value.
b) USE OF ESTIMATES
The preparation of financial statements in accordance with
United States generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial statements, and the reported amounts of expenses
during the reporting period. Actual results could differ from
management's best estimates as additional information becomes
available in the future.
c) MINERAL PROPERTIES
The Company holds option agreements to acquire exclusive gold
exploration, prospecting and development rights and privileges
to six (6) unpatented mining claims ("the Mining Claims"),
located in the Jefferson County, State of Montana. Under the
mining exploration and option agreement signed on April 29,
2005,the Company holds the exclusive option to purchase the
Mining Claims for a total cash consideration of One million
United States dollars ($1,000,000) ("the purchase price")
subject to a 2% Net smelter return royalty. A payment of $7,500
was made upon execution of the agreement on April 29, 2005 and
an additional payment is due on the first anniversary date of
signing and $15,000 per year thereafter until the purchase
price has been paid, unless the agreement is terminated or
cancelled. In the event the option to purchase is exercised,
all annual payments and/or royalty production payments will be
<PAGE 57>
credited against the purchase price.
Annual payments towards the Mining Claims are expensed until
such time as the properties have proven reserves when these
amounts will be capitalized under mineral properties.
d) FAIR VALUE OF FINANCIAL INSTRUMENTS
Unless otherwise noted, it is management's opinion that the
Company is not exposed to significant interest, currency or
credit risks arising from its financial instruments. The fair
value of its financial instruments approximates their carrying
values, unless otherwise noted.
e) INCOME TAXES
Deferred income taxes are reported for timing differences
between items of income or expense reported in the financial
statements and those reported for income tax purposes in
accordance with US GAAP, which requires the use of
asset/liability method of accounting for income taxes.
Deferred income taxes and tax benefits are recognized for the
future tax consequences attributable to differences between the
financial statements carrying amounts of existing assets and
liabilities and their respective tax bases, and for the tax
loss and credits carryforwards. Deferred tax assets and
liabilities are measured using the enacted rates expected to
apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The
Company provides for deferred taxes for the estimated future
tax effects attributable to temporary differences and
carryforwards when realization is more likely than not. The
deferred taxes for the company therefore amount to nil at the
balance sheet date.
f) NET LOSS PER COMMON SHARE
Basic EPS is computed by dividing income (loss) attributable to
common stockholders by weighted average number of common shares
outstanding during the period. Diluted EPS gives effect to all
dilutive potential common shares outstanding during the period.
<PAGE 58>
3. CASH AND CASH EQUIVALENTS
Bank account $4,266
Cash on short term deposit $15,099
$19,365
========
The term deposit matures on October 23, 2005, and bears
interest at 1.8%.
4. RELATED PARTY TRANSACTIONS
As part of initial capitalization of the Company, the founding
shareholders subscribed for 500,000 common shares for cash
consideration of $50,000.
Consulting fees of $7,400 were paid to a director of the
Company.
These transactions are in the normal course of the Company's
operations and were measured at the exchange amount.
5. SHARE CAPITAL
The authorized share capital of the Company consists of 500,000
preferred shares and 1,500,000 common shares with a par value
of $0.0001per share. Each common share entitles the holder to
one vote and no holder of the common shares shall be entitled
to any right of cumulative voting. Preferred shares may be
issued is series with distinctive serial designations.
Currently, the Company has outstanding 500,000 common shares
and no preferred shares. These were issued on incorporation
March 24, 2005.
<PAGE 59>
No person has been authorized to give any information or to make any
representations in connection with this offering other than those
contained in this prospectus and, if given or made, such other
information and representations must not be relied upon as having
been authorized by Gentor Resources, Inc. Neither the delivery of
this prospectus nor any sale made will, under any circumstances,
create any implication that there has been no change in the affairs
of Gentor Resources, Inc. since the date of this prospectus or that
the information contained in this prospectus is correct as of any
time subsequent to its date. This prospectus does not constitute an
offer to sell or a solicitation of an offer to buy any securities
other than the registered securities to which it relates. This
prospectus does not constitute an offer to sell or a solicitation of
an offer to buy such securities in any circumstances in which such
offer or solicitation is unlawful.
-----------------------
TABLE OF CONTENTS
PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . 4
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . .21
USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . . . . .22
DIVIDEND POLICY. . . . . . . . . . . . . . . . . . . . . . . . . . .24
DILUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
<PAGE 60>
MANAGEMENT'S PLAN OF OPERATION . . . . . . . . . . . . . . . . . . .25
PROPOSED BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . . .31
MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
CERTAIN TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . .39
DESCRIPTION OF COMMON STOCK. . . . . . . . . . . . . . . . . . . . .39
SHARES ELIGIBLE FOR FUTURE SALE. . . . . . . . . . . . . . . . . . .41
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . .41
LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . .43
LEGAL MATTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . .44
ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . .44
------------------------
<PAGE 61>
Until , 2005 (90 days after the date of this
prospectus), all dealers that effect transactions in these
securities, whether or not participating in this offering, may be
required to deliver a prospectus. This is in addition to the
dealers' obligation to deliver a prospectus when acting as
underwriters and with respect to their unsold allotments or
subscriptions.
Gentor Resources, INC.
COMMON STOCK
------------------------
PROSPECTUS
------------------------
December 15, 2005
<PAGE 62>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses to be paid by the Registrant in connection with this
offering are as follows. All amounts other than the SEC registration
fee are estimates.
ITEM AMOUNT
SEC registration fee $117.70
Printing $3,000.00
Legal fees and expenses $35,000.00
Accounting and auditing fees and expenses $16,700.00
Blue sky fees and expenses $5,000.00
Transfer agent fees $3,000.00
Miscellaneous $1,500.00
TOTAL $64,317.70
ITEM 25. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant had agreed to indemnify its executive officers and
directors the fullest extent permitted by the Florida Business
Corporation Act. That Act permits the Registrant to indemnify any
person who is, or is threatened to be made, a party to any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an
action by the Registrant or in its right) by reason of the fact that
the person is or was an officer or director or is or was serving our
request as a an officer or director. The indemnity may include
expenses (including attorney's fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by the person in
<PAGE 63>
connection with the action, suit or proceeding, provided that such
person acted in good faith and in a manner such person reasonably
believed to be in or not opposed to our best interests, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe such person's conduct was unlawful. The Registrant
may indemnify officers and directors in an action by the Registrant
or in its right under the same conditions, except that no
indemnification is permitted without judicial approval if the
officer or director is adjudged to be liable to the Registrant.
Where an officer or director is successful on the merits or
otherwise in the defense of any action referred to above, the
Registrant must indemnify such person against the expenses which
such person actually and reasonably incurred. The foregoing
indemnification provisions are not exclusive of any other rights to
which an officer or director may be entitled under a our bylaws, by
agreement, vote, or otherwise.
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
(a) Upon formation, the Registrant issued 500,000 shares of
common stock for an aggregate consideration of $50,000 to
two founders, all of whom are, pursuant to the provisions
of Rule 405 of Regulation C under the Securities Act are
deemed to be "organizers" of the Company since at
inception, each of such shareholders received in excess of
ten (10%) percent of the common stock of the Company.
(b) There were no principal underwriters.
(c) The aggregate consideration for the securities referred to
in subparagraph was $50,000.
(d) The Registrant claimed exemption from the registration
provisions of the Securities Act of 1933 with respect to
the securities pursuant to Section 4(2) thereof inasmuch
as no public offering was involved.
ITEM 27. EXHIBITS.
3.01 Articles of Incorporation(1).
3.03 Bylaws (1).
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4.01 Form of Specimen Stock Certificate for the
Registrant's Common Stock (1).
5.01 Opinion of Edward H. Gilbert, P.A. regarding legality
of securities being registered (1).
10.01 Option Agreement (1).
23.01 Consent of Edward H. Gilbert, P.A. (included in
Exhibit 5.01)(1).
23.02 Consent of BDO Dunwoody LLP(1).
23.03 Consent of Roscoe Postle Associates, Inc.(1).
99.01 Report of Roscoe Postle Associates, Inc.(1).
____________________
(1)Filed herewith.
ITEM 28. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
Registration Statement to:
(i) Include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change
in the information in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high end of
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the estimated maximum offering range may be reflected in
the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(iii) Include any additional or changed material
information on the plan of distribution.
(2) For determining liability under the Securities Act, each
such post-effective amendment shall be treated as a new
registration statement of the securities offered, and the
offering of the securities at that time to be the initial
bona fide offering.
(3) To file a post-effective amendment to remove from
registration any of the securities that remain unsold at
the end of the offering.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a
director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
In accordance with the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form SB-2 and
has authorized this registration statement to be signed on its
behalf by the undersigned, in the Virginia City, State of Montana,
on the 15 day of December, 2005.
Gentor Resources, Inc.
/s/ Lloyd J. Bardswich
---------------------------------
By: Lloyd J. Bardswich, President
and principal executive officer
/s/ Lloyd J. Bardswich
---------------------------------
By: Lloyd J. Bardswich, principal
financial officer
In accordance with the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons
in the capacities and on the dates stated.
Date: December 15, 2005 /s/ Lloyd J. Bardswich
---------------------------------
By: Lloyd J. Bardswich, principal
executive officer
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Date: December 15, 2005 /s/ Lloyd J. Bardswich
---------------------------------
By: Lloyd J. Bardswich, principal
accounting officer
Date: December 15, 2005 /s/ Lloyd J. Bardswich
---------------------------------
By: Lloyd J. Bardswich, director
Date: December 15, 2005 /s/ Kitt M. Dale
---------------------------------
By: Kitt M. Dale, director
Date: December 15, 2005 /s/ Samuel L. Henry
---------------------------------
By: Samuel L. Henry, director
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