Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
10-Q
x
|
Quarterly
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
For the
quarterly period ended: September 30, 2010
¨
|
Transition
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
For the
transition period from ________ to _________
Commission
File Number: 000-50994
ARDENT
MINES LIMITED
(Exact
Name of Registrant as Specified in its Charter)
Nevada
|
88-0471870
|
(State
or Other Jurisdiction of
|
(IRS
Employer Identification
|
Incorporation
or Organization)
|
Number)
|
100
Wall Street, 21st
Floor
New
York, New York 10005
(Address
of principal executive offices)
(561)
989-3200
(Registrant's
telephone number, including area code)
N/A
(Former
Name, Former Address and Former Fiscal Year,
If
Changed Since Last Report)
Indicate
by check mark whether the registrant: (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x No
¨
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files). Yes ¨ No
¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large
Accelerated Filer
|
¨
|
Accelerated
Filer
|
¨
|
Accelerated
Filer
|
¨
|
Smaller
Reporting Company
|
x
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes x No
¨
Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date: The Issuer had 14,957,650 shares of
Common Stock, par value $0.00001, outstanding as of November 10,
2010.
ARDENT
MINES LIMITED
FORM
10-Q
September
30, 2010
Table
of Contents
PART
I— FINANCIAL INFORMATION
|
|
|
|
|
|
|
Item
1.
|
Financial
Statements (unaudited)
|
|
3
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition
|
|
4
|
Item
3
|
Quantitative
and Qualitative Disclosures About Market Risk
|
|
8
|
Item
4.
|
Control
and Procedures
|
|
8
|
|
|
|
|
PART
II— OTHER INFORMATION
|
|
|
|
|
|
|
Item
1
|
Legal
Proceedings
|
|
9
|
Item
1A
|
Risk
Factors
|
|
9
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
|
9
|
Item
3.
|
Defaults
Upon Senior Securities
|
|
9
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
|
9
|
Item
5.
|
Other
Information
|
|
9
|
Item
6.
|
Exhibits
and Reports on Form 8-K
|
|
10
|
|
|
|
|
|
SIGNATURE
|
|
11
|
Item
1. Financial
Statements.
Ardent
Mines Limited
(An
Exploration Stage Company)
September
30, 2010
FINANCIAL
STATEMENTS
|
|
|
Balance
Sheets (unaudited)
|
|
F-1
|
Statements
of Expenses (unaudited)
|
|
F-2
|
Statements
of Cash Flows(unaudited)
|
|
F-3
|
NOTES
TO (Unaudited) FINANCIAL STATEMENTS
|
|
F-4
|
ARDENT
MINES LIMITED
(An
Exploration Stage Company)
(Unaudited)
|
|
September 30,
|
|
|
June 30,
|
|
|
|
2010
|
|
|
2010
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash
|
|
$ |
9,880 |
|
|
$ |
4,736 |
|
TOTAL
ASSETS
|
|
$ |
9,880 |
|
|
$ |
4,736 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
6,060 |
|
|
|
6,060 |
|
Loan
Payable
|
|
|
100,000 |
|
|
|
- |
|
Related
party advances
|
|
|
- |
|
|
|
38,490 |
|
Salary
pabable related party
|
|
|
10,000 |
|
|
|
|
|
Advances
|
|
|
43,554 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
$ |
159,614 |
|
|
$ |
44,550 |
|
|
|
|
|
|
|
|
|
|
Stockholders’
Deficit
|
|
|
|
|
|
|
|
|
Preferred
Stock, $0.00001 par value, 100,000,000 shares authorized, 0 shares issued
and outstanding
|
|
|
- |
|
|
|
- |
|
Common
Stock, $0.00001 par value, 100,000,000 shares authorized, 14,307,650
shares issued and outstanding
|
|
|
150 |
|
|
|
149 |
|
Additional
paid in capital
|
|
|
551,517 |
|
|
|
467,018 |
|
Deficit
accumulated during the exploration stage
|
|
|
(701,401 |
) |
|
|
(506,981 |
) |
|
|
|
|
|
|
|
|
|
Total
Stockholders’ Deficit
|
|
|
(149,734 |
) |
|
|
(39,814 |
) |
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
$ |
9,880 |
|
|
$ |
4,736 |
|
The
accompanying notes are an integral part of these interim unaudited financial
statements.
ARDENT
MINES LIMITED
(An
Exploration Stage Company)
(Unaudited)
|
|
Three Month
Ended
September 30,
2010
|
|
|
Three Month
Ended
September 30,
2009
|
|
|
Inception
(July 27, 2000)
Through
September 30,
2010
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
Executive
compensation
|
|
$ |
119,500 |
|
|
$ |
- |
|
|
$ |
119,500 |
|
Consulting
expense
|
|
|
5,000 |
|
|
|
4,385 |
|
|
|
319,246 |
|
Filing
and incorporation fees
|
|
|
204 |
|
|
|
- |
|
|
|
3,667 |
|
General
& administrative
|
|
|
360 |
|
|
|
35 |
|
|
|
38,424 |
|
Legal
& accounting
|
|
|
38,507 |
|
|
|
5,000 |
|
|
|
202,012 |
|
Geologist
|
|
|
10,000 |
|
|
|
- |
|
|
|
10,000 |
|
Mining
exploration
|
|
|
- |
|
|
|
- |
|
|
|
14,588 |
|
Travel
|
|
|
20,849 |
|
|
|
269 |
|
|
|
30,388 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Operating Expenses
|
|
|
194,420 |
|
|
|
9,689 |
|
|
|
737,825 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
- |
|
|
|
- |
|
|
|
1,290 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt
Forgiveness
|
|
|
- |
|
|
|
- |
|
|
|
(37,714 |
) |
Total
Other Income
|
|
|
- |
|
|
|
- |
|
|
|
37,714 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS
|
|
$ |
(194,420 |
) |
|
$ |
(9,689 |
) |
|
$ |
(701,401 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS PER COMMON SHARE- BASIC AND DILUTED
|
|
$ |
(0.00 |
) |
|
$ |
(0.00 |
) |
|
|
N/A |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE COMMON SHARES OUTSTANDING-BASIC AND DILUTED
|
|
|
14,957,650 |
|
|
|
14,257,650 |
|
|
|
N/A |
|
The
accompanying notes are an integral part of these interim unaudited financial
statements.
(An
Exploration Stage Company)
STATEMENTS
OF CASH FLOWS
(unaudited)
|
|
|
|
|
Inception
|
|
|
|
|
|
|
(July
27, 2000)
|
|
|
|
Three
Months Ended
|
|
|
Through
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2010
|
|
|
2009
|
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$ |
(194,420 |
) |
|
$ |
(9,689 |
) |
|
$ |
(701,401 |
) |
Adjustments
to reconcile net loss to cash used in operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Imputed
interest on related party payable
|
|
|
- |
|
|
|
- |
|
|
|
1,290 |
|
Stock
issued for services
|
|
|
84,500 |
|
|
|
- |
|
|
|
358,500 |
|
Change
in:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable & accrued liabilities
|
|
|
- |
|
|
|
4,385 |
|
|
|
(10,069 |
) |
Salaries
payable-related party
|
|
|
10,000 |
|
|
|
|
|
|
|
10,000 |
|
NET
CASH USED IN OPERATING ACTIVITIES
|
|
|
(99,920 |
) |
|
|
(5,304 |
) |
|
|
(340,680 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from sales of common stock
|
|
|
- |
|
|
|
- |
|
|
|
190,877 |
|
Advances
|
|
|
5,064 |
|
|
|
- |
|
|
|
5,064 |
|
Loan
payable
|
|
|
100,000 |
|
|
|
- |
|
|
|
100,000 |
|
Advances
from related party
|
|
|
- |
|
|
|
5,490 |
|
|
|
54,619 |
|
NET
CASH PROVIDED BY FINANCING ACTIVITIES
|
|
|
105,064 |
|
|
|
5,490 |
|
|
|
610,720 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
CHANGE IN CASH
|
|
|
5,144 |
|
|
|
186 |
|
|
|
350,561 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
AT BEGINNING OF PERIOD
|
|
|
4,736 |
|
|
|
494 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
AT END OF PERIOD
|
|
$ |
9,880 |
|
|
$ |
680 |
|
|
$ |
9,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Paid
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
Income
tax Paid
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
The
accompanying notes are an integral part of these interim unaudited financial
statements.
ARDENT
MINES LIMITED
(An
Exploration Stage Company)
NOTE
1 - BASIS OF PRESENTATION
The
accompanying unaudited interim financial statements of Ardent Mines Limited,
have been prepared in accordance with accounting principles generally accepted
in the United States of America and the rules of the Securities and Exchange
Commission, and should be read in conjunction with the audited financial
statements and notes thereto contained in Ardent Mine's Annual Report filed with
the SEC on Form 10−K for the fiscal year ended June 30, 2010. In the opinion of
management, all adjustments, necessary for a fair presentation of financial
position and the results of operations for the interim periods presented have
been reflected herein. The results of operations for interim periods are not
necessarily indicative of the results to be expected for the full year. Notes to
the financial statements which substantially duplicate the disclosure contained
in the audited financial statements for the fiscal year ended June 30, 2010 as
reported in the Form 10−K have been omitted.
NOTE
2 - GOING CONCERN
From July
27, 2000 (date of inception) to September 30, 2010, Ardent Mines Limited has
incurred an accumulated deficit and has a working capital deficit at September
30, 2010. The ability of Ardent Mines to emerge from the exploration stage with
respect to any planned principal business activity is dependent upon its
successful efforts to raise additional equity financing and/or attain profitable
mining operations. Management has plans to seek additional capital through a
private placement and public offering of its common stock. There is no guarantee
that Ardent Mines will be able to complete any of the above objectives. These
factors raise substantial doubt regarding the Ardent Mines’ ability to continue
as a going concern.
NOTE
3 - LOANS
On August
31, 2010, we borrowed $100,000 from CRG Finance AG at a rate of 7.5% per annum.
The loan, plus any interest accumulated, is due upon demand after one
year.
NOTE
4 - ADVANCES
As of
September 30, 2010, Ardent Mines owes Urmas Turu, former president, $43,554 that
was used for payment of expenses on behalf of the Company. The amount
has no terms of repayment, is unsecured, and bears no interest.
NOTE
5- RELATED PARTY TRANSACTIONS
Pursuant
to the Employment Agreement, on September 27, 2010 Mr. Riera was granted fifty
thousand (50,000) restricted shares of the Company’s common stock (the
“Shares”). In consideration for services rendered to the Company, Mr.
Riera shall be paid a base salary of Twenty Thousand U.S. Dollars ($20,000) per
month (“Base Salary”). Base Salary shall be paid retroactive to
August 15, 2010. As of September 30, 2010 $10,000 was accrued for.
NOTE
6 – SUBSEQUENT EVENTS
On
October 19, 2010, the Company entered into a Convertible Promissory Note with
CRG Finance AG, which is contingent upon a major acquisition which has not yet
occurred. The Lender has agreed to loan up to $1,000,000 which may be
drawn down in tranches at a7.5% interest rate. After the first
anniversary thereof, the loan shall be due thirty (30) days after a demand is
made by the Lender. In lieu of payment in cash, the Lender may
request that the Company repay any or all of the principal and/or interest in
the form of restricted common stock at a price per share equal to 80% of the
average closing price of the Company’s common stock over the 30 days immediately
preceding the closing of the major acquisition.
Item
2. Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
The following discussion of the financial condition and results of
operations of the Company should be read in conjunction with the financial
statements and the related notes thereto included elsewhere in this Quarterly
Report on Form 10-Q (this “Report”). This Report contains certain
forward-looking statements and the Company's future operating results could
differ materially from those discussed herein. Certain statements contained in
this Report, including, without limitation, statements containing the words
“believes”, “anticipates,” “expects” and the like, constitute “forward-looking
statements” within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). However, as the Company intends to issue “penny stock,” as such
term is defined in Rule 3a51-1 promulgated under the Exchange Act, the Company
is ineligible to rely on these safe harbor provisions. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of the Company
to be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Given these
uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements. The Company disclaims any obligation to update any
such factors or to announce publicly the results of any revisions of the
forward-looking statements contained or incorporated by reference herein to
reflect future events or developments, except as required by the Exchange
Act.
Unless
otherwise provided in this Report, references to the “Company,” the
“Registrant,” the “Issuer,” “we,” “us,” and “our” refer to Ardent Mines
Limited.
Introduction
We were
incorporated in Nevada on July 27, 2000. We are presently engaged in the
acquisition of mining properties. The Company’s address is 100 Wall
Street, 21st Floor,
New York, NY 10005. The Company’s telephone number is (561)
989-3200.
In August
2000, we acquired the right to prospect one mineral property containing eight
mining claims located on Copperkettle Creek in British Columbia,
Canada. We have allowed these claims to lapse. From August
26, 2006 to December 11, 2006, we did not conduct any
operations. During that period, we intended to identify an
acquisition or merger candidate with ongoing operations in any
field. However in December 2006 we decided to acquire the right to
explore a new property in British Columbia and returned to the business of
mineral exploration. On April 30, 2009, the Company decided not to renew certain
claims due to a lack of capital. To date we have not performed any work on
developing claims in Canada, and we no longer plan to pursue such
development. The Company determined to pursue other mining
development opportunities.
During
the period covered by this Report, the Company has expanded its Board of
Directors, appointed new officers, and entered into a Letter of Intent for the
acquisition of a Brazilian mining company. The Company is continuing
to negotiate, and perform due diligence related to the acquisition of the
Brazilian company, and is exploring other potential acquisitions.
The
Company’s Current Business Operations
Change
of Officers and Directors
On August
25, 2010, Mr. Urmas Turu resigned as the President of the Company. He
shall remain a member of the Company’s Board of Directors and as the Company’s
Secretary and Treasurer until qualified replacements are
appointed. On August 25, 2010, Mr. Leonardo Alberto Riera was
appointed as a member of the Company’s Board of Directors and as the President
of the Company. On September 2, 2010, Mr. Luis Feliu was appointed as
the Chief Financial Officer of the Company. Mr. Riera and Mr. Feliu
will both devote the majority of their time to the Company’s
operations.
On
September 1, 2010, we executed a consulting agreement o pay Executive Consulting
Services Group (ECS) $1,000 per month on a month-by-month basis, renewable by
mutual agreement. ECS provides administrative support for the day-to-day
operations of the Company. Such administrative duties include maintaining
compliance with regulatory agencies, maintaining the Corporate Minute Book and
acting as the Company’s bookkeeper.
Letter
of Intent to Acquire Rio Sao Pedro Mineracao LTDA
On
September 25, 2010, the Company entered into a letter of intent (the “Letter of
Intent”) with Rio Sao Pedro Mineracao LTDA (“Rio Sao Pedro”), a Brazilian mining
company. Rio Sao Pedro owns a prospective gold mine, the “Fazenda
Lavras,” which is near the Morro do Ouro mine of Kinross Gold Corporation in the
city of Paracatu, located in the State of Minas Gerais, Brazil. The
Rio Sao Pedro Fazenda Lavras property covers approximately 211 hectares
(approximately 521 acres), with gold mining rights and other mineral rights on a
total of 828 hectares (approximately 2,046 acres). Subject to the
closing of the transaction, Rio Sao Pedro will become a wholly owned subsidiary
of the Company.
Pursuant
to the Letter of Intent, the Company will acquire all of the issued and
outstanding equity interests in Rio Sao Pedro from its shareholders (the
“Sellers”). In consideration for the acquisition of Rio Sao Pedro,
the Company will issue 14,957,650 shares of Company common stock (the “Ardent
Shares”). The Ardent Shares shall represent, as of the date of their
issuance to the Sellers, fifty percent (50%) of the issued and outstanding
equity shares of the Company. At the closing of the transaction, the
Sellers will be entitled to appoint a representative to the Company’s Board of
Directors.
The
closing of the transaction is subject to customary closing conditions, including
the completion of an independent geology survey, completion of audited financial
statements, acquisition of all necessary government approvals to commence gold
mining on the property, completion of due diligence satisfactory to the Company
in its sole discretion, and execution of detailed final agreements supplementing
the terms and conditions of the Letter of Intent, including, without limitation,
representations regarding the validity of the assessments of all gold ore
reserves, the status of all government licenses and related
matters. The Company will cover and pay for certain of the
pre-closing actions and satisfy certain third-party liens on the Fazenda Lavras
property. The Company has agreed to place certain good faith
pre-closing funds into escrow. The parties have also agreed that if
the Company’s share price does not reach certain benchmarks within a specified
period of time, the Sellers of Rio Pedro Mineracao will have a put right with
respect to their shares, pursuant to which they may retake title to their
original Rio Sao Pedro Shares. The parties have agreed to use their
best efforts to finalize and sign supplemental detailed agreements as soon as
reasonably possible within a target date of ninety days of September 30,
2010. Rio Sao Pedro and the Sellers have agreed to definitive
exclusivity and not to solicit or negotiate any alternative
transactions.
Corporate
Development Services Agreement
On
September 27, 2010, the Company entered into a Corporate Development Services
Agreement (the “Services Agreement”) with CRG Finance AG
(“CRG”). Pursuant to the Services Agreement, CRG has agreed to render
to the Company consulting and other advisory services (collectively, the
“Advisory Services”) in relation to developing strategic plans for inception of
operations, corporate management, the operations of the Company, strategic
planning, domestic and international marketing and sales, financial advice,
advisory and consulting services, recommendations of candidates for senior
management positions of the Company, prospective strategic alliance partners,
preparing acquisition growth plans, identifying prospective merger and
acquisition candidates, developing value propositions for the Company, analyzing
financial implications of potential transactions, advising on negotiations
regarding terms and conditions of transactions, outlining and managing due
diligence issues and due diligence processes, introductions to prospective
customers, selection of investment bankers or other financial advisors or
consultants, and advice with respect to the capital structure of the Company,
equity participation plans, employee benefit plans and other incentive
arrangements for certain key executives of the Company. CRG shall
also render investment banking and finance consulting services to the Company
(collectively, the “Investment Banking Services”). The scope of CRG
Investment Banking Services shall include such services rendered only outside of
the United States and only to non-U.S. persons. The Company will pay to CRG the
following amounts for the Advisory Services: (i) an inception fee of
US$100,000.00 (one hundred thousand U.S. dollars) and (ii) a monthly services
fee of US$25,000.00 (twenty five thousand U.S. dollars) per month, payable each
month for the period commencing as of September 1, 2010. CRG shall be
paid $10,000 per month of the Advisory Services Fee beginning September 1, 2010,
with the balance of $15,000 per month of the Advisory Services Fees together
with the Inception Payment accruing until completion of the first Company
financing following the date of this Agreement when such accruals shall be fully
due and payable. In consideration of any and all Investment Banking
Services provided to the Company, CRG shall receive in cash ten percent (10%) of
the total value of each such transaction, payable at the closing of each such
transaction. The Services Agreement also contains provisions for the
reimbursement of reasonable expenses incurred by CRG, and for indemnification of
CRG and its affiliates from claims related to the services provided under the
Services Agreement. The term of the Services Agreement shall be three
years, and may be terminated at any time for any reason by CRG upon not less
than thirty (30) days’ advance written notice.
Employment
Agreement with Leonardo Riera
Effective
as of September 27, 2010, the Company has entered into an Employment Agreement
with Leonardo Riera regarding his service as President and Chief Executive
Officer of the Company. Mr. Riera shall devote approximately 75% to
100% of his professional working time to the Company. The Employment Agreement
has an initial two year period subject to renewal.
In
consideration for services rendered to the Company, Mr. Riera shall be paid a
base salary of Twenty Thousand U.S. Dollars ($20,000) per month (“Base
Salary”). Base Salary shall be paid retroactive to August 15,
2010. Ten thousand U.S. Dollars ($10,000) of the Base Salary shall be
payable incrementally on a monthly basis and pro-rated for any partial month of
employment, less any applicable statutory and regulatory deductions, which shall
be payable in accordance with the Company’s regular payroll practices, as the
same may be modified from time to time. The remainder of the Base
Salary shall accrue until such time as the Company shall have received capital
investments in the amount of ten million U.S. Dollars ($10,000,000), at which
time all accrued and unpaid amounts shall be due and payable.
Pursuant
to the Employment Agreement, Mr. Riera shall be granted fifty thousand (50,000)
restricted shares of the Company’s common stock (the “Shares”). Until
the second anniversary of the date hereof, the Shares may not be sold,
transferred, used as security for a loan or otherwise encumbered, except for
customary estate planning exceptions. The Employment Agreement also
contains customary provisions regarding protection of Company trade secrets,
non-solicitation of Company employees or customers and non-competition with the
Company during the term of the Agreement.
Results
of Operations
Revenues
We are an
exploration stage corporation and have not generated any revenues from
operations.
Expenses
During
the three month period ended September 30, 2010, we incurred total expenses of
$194,420 which included $38,507 in legal and accounting fees, $119,500 in
executive compensation, $20,849 for travel expenses, $10,000 in geologist’s
fees; $5,000 in consulting fees, $204 in filing and incorporation fees, and $360
in general and administrative fees. Comparatively, during the same period in
2009, we incurred total expenses of $9,689 which included $4,385 in consulting
fees, $5,000 in legal and accounting fees, $269 for travel expenses and $35 in
general and administrative fees. The significant increase in
expenditures since the comparable period of last year was caused by the
Company’s increased activities. From the inception of the Company
through September 30, 2010, we have incurred total expenses of $737,825 which
included $202,012 in legal and accounting fees, $119,500 in executive
compensation, $30,388 for travel expenses, $319,246 in consulting fees, $10,000
in geologist’s fees; $3,667 in filing and incorporation fees, and $38,424 in
general and administrative fees.
Losses
During
the three month period ended September 30, 2010 we did not earn any revenues and
incurred a net loss of $194,420. During the three month period ended September
30, 2009 we did not earn any revenues and incurred a net loss of
$9,689. From the inception of the Company through September 30, 2010,
the Company has incurred total losses of $701,401.
Liquidity
and Capital Resources
As of the
date of this Report, we have yet to generate any revenues from our business
operations. The Company has raised funds through the sale of equity and
borrowing. The Company will need to raise additional capital to
commence operations. The amount of capital required will be
determined by the size and nature of the mining projects which the Company may
commence in the future. We have no assurance that financing will be
available to us on acceptable terms. If financing is not available on
satisfactory terms, we may be unable to continue, develop or expand our
operations. Any equity financing we may pursue will result in additional
dilution to existing shareholders.
On July
27, 2007 we completed our private placement. We raised $82,432 by
selling 8,243,200 shares of common stock at a price of $0.01 per share to twelve
investors. The proceeds of the offering have been used to sustain
operations through the date of this Report.
On May
11, 2010, we entered into a stock purchase agreement with CRG Finance AG whereby
CRG Finance AG purchased 700,000 shares of common stock at $0.01 per share for a
total of $7,000.
On August
31, 2010, we signed a promissory note agreeing to borrow $100,000 from CRG
Finance AG at a rate of 7.5% per annum, calculated based on a year of 365 days
and actual days elapsed. The loan, plus any interest accumulated, is due upon
demand after the first anniversary of the agreement date within thirty calendar
days upon delivery to the Borrower a written demand by the Lender.
As of
September 30, 2010, both our current and total assets were equal to $9,880,
consisting entirely of cash. This represented an increase from our
current and total assets as of June 30, 2010, which were both equal to $4,736,
and also consisted entirely of cash. As of September 30, 2010, our current and
total liabilities were $159,614. As of such date, we had a
shareholder’s deficit of $149,734. As of June 30, 2010, our current and total
liabilities were $44,550, and we had a shareholder’s deficit of
$39,814.
Recent
accounting pronouncements
Certain
accounting pronouncements have been issued by the FASB and other standard
setting organizations which are not yet effective and have not yet been adopted
by the Company. The impact on the Company’s financial position and results of
operations from the adoption of these standards is not expected to be
material.
The
Company does not have any off balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the Company's financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital
resources.
Subsequent
Events
Convertible
Promissory Note with CRG Finance AG
On
October 19, 2010, the Company entered into a Convertible Promissory Note with
CRG Finance AG (the “Lender”). The Lender has agreed to loan the
Company an aggregate of up to One Million U.S. Dollars ($1,000,000) which may be
drawn down by the Company in tranches at an interest rate of seven and one half
percent (7.5%). After the first anniversary thereof, the loan shall
be due thirty (30) days after a demand is made by the Lender. In lieu
of payment in cash, the Lender may request that the Company repay any or all of
the principal and/or interest in the form of restricted common stock of the
Company at a price per share equal to eighty percent (80%) of the average
closing price of the Company’s common stock over the thirty (30) days
immediately preceding the closing of the planned acquisition of, announcing the
prospective acquisition of Rio Sao Pedro Mineracao LTDA (“RSPM”) or such
other third-party assets or shares of a strategic acquisition company which may
be acquired earlier than such RSPM closing.
Appointment
of Gabriel Margent to the Board of Directors
Subsequent
to the period covered by this Report, Mr. Gabriel Margent has been appointed as
a member of the Board of Directors of the Company, and commenced his services as
of November 1, 2010. Mr. Margent will serve on the Audit Committee of the
Company’s Board of Directors and serve as the Audit Committee’s financial
expert. The Company’s Board of Directors has determined that Mr.
Margent is an independent director. The Company has adopted the
standards for director independence contained in Nasdaq Marketplaces Rule
5605(a)(2).
Item
3.
|
Quantitative
and Qualitative Disclosure About Market
Risk.
|
Not
Applicable.
We
maintain “disclosure controls and procedures,” as such term is defined in Rule
13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that
are designed to ensure that information required to be disclosed in our Exchange
Act reports is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission rules and forms, and
that such information is accumulated and communicated to our management,
including our Principal Executive Officer and Principal Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure. As of the
end of the period covered by this Report, the Company carried out, under the
supervision and with the participation of the Company’s management, including
its Chief Executive Officer and Chief Financial Officer, an evaluation of the
effectiveness of the design and operation of the Company’s disclosure controls
and procedures in ensuring that information required to be disclosed by the
Company in its reports is recorded, processed, summarized and reported within
the required time periods. Based on their evaluation of the
Company’s disclosure controls and procedures as of September 30, 2010, the
Company’s Chief Executive Officer and Chief Financial Officer have concluded
that, as of that date, the Company’s controls and procedures were effective for
the purposes described above.
Changes
in Internal Control over Financial Reporting
There was
no change in the Company’s internal control over financial reporting (as defined
in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934)
during the quarter ended September 30, 2010 that has materially affected or is
reasonably likely to materially affect the Company’s internal control over
financial reporting.
PART
II. OTHER INFORMATION
Currently
we are not aware of any litigation pending or threatened by or against the
Company.
Item
2.
|
Unregistered
Sales of Equity Securities and Use of
Proceeds.
|
Not
Applicable.
|
Defaults
Upon Senior Securities.
|
Not
Applicable.
Not
Applicable.
(a)
Exhibits
Exhibit No.
|
|
Description of Exhibits
|
|
|
|
Exhibit
10.5
|
|
Promissory
Note, by and between the Company and CRG Finance AG, dated as of August
31, 2010.
|
|
|
|
Exhibit
10.6
|
|
Letter
of Intent to Acquire Rio Sao Pedro Mineracao LTDA, by and between the
Company and Rio Sao Pedro Mineracao LTDA, dated as of September 25,
2010.
|
|
|
|
Exhibit
10.7
|
|
Employment
Agreement, by and between the Company and Leonardo Riera, dated as of
September 27, 2010.
|
|
|
|
Exhibit
10.8
|
|
Convertible
Promissory Note, by and between the Company and CRG Finance AG, dated as
of October 19, 2010.
|
|
|
|
Exhibit 31.1
|
|
Certification
of Principal Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
|
|
Exhibit 31.2
|
|
Certification
of Principal Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
|
|
Exhibit 32.1
|
|
Certification
of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
Exhibit
32.2
|
|
Certification
of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
|
ARDENT
MINES LIMITED
|
|
(Registrant)
|
|
|
Dated:
November 15, 2010
|
|
|
By:
|
/s/
Leonardo Riera
|
|
|
Name:
|
Leonardo
Riera
|
|
|
Title:
|
Principal
Executive Officer
|
|
|
|
|
Dated:
November 15, 2010
|
|
|
|
|
By:
|
/s/
Luis Feliu
|
|
|
Name:
|
Luis
Feliu
|
|
|
Title:
|
Principal
Financial Officer and
Chief
Accounting
Officer
|