SEC Company Response from Exousia Pro, Inc. (MAJI) (CIK 0001492448) (MAJI) — May 11, 2012
Exousia Pro, Inc. (MAJI) (CIK 0001492448)
Date: May 11, 2012 · CIK: 0001492448 · Accession: 0001185185-12-000986
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-167284
Referenced dates: April 4, 2012, March 5, 2012, May 4, 2012
Letter
normancay-corresp051112.htm
May 11, 2012
VIA EDGAR
Ajay Koduri
Securities and Exchange Commission
Division of Corporation Finance
100 F Street N.E.
Washington DC 20549
Re:
Norman Cay Development, Inc.
Form 10-Q for the quarter ended January 31, 2012
Filed March 14, 2012
Form 8-K dated January 23, 2012
Filed January 30, 2012
Response letter dated March 5, 2012
File No. 333-167284
We are responding to comments contained in the Staff letter, dated April 4, 2012, addressed to Shelley Guidarelli, former President of the Company, with respect to the Company’s Form 10-Q for the quarter ended January 31, 2012, filed with the Securities and Exchange Commission (the “SEC”) on March 14, 2012, Form 8-K dated January 23, 2012 filed on January 30, 2012 and response letter dated March 5, 2012.
The Company has replied below on a comment by comment basis, with each response following a repetition of the Staff’s comment to which it applies (the “Comments”). The responses to the Comments are numbered to relate to the corresponding Comments in your letter.
Form 8-K filed on January 30, 2012
Form 8-K/A dated October 14, 2011, incorporated therein by reference
1.
According to the last paragraph of page 2, you acquired 100% of the shares of Discovery Gold Ghana Limited on September 2, 2011. Tell us about your consideration of whether Rule 8-04 of Regulation S-X required you to furnish financial statements and any pro forma information specified by Rule 8-05 of Regulation S-X.
Response:
Upon the acquisition of Discovery Gold Ghana Limited (“DGGL”), the assets of DGGL comprised the original members’ shares issued to incorporate the company, and the assets of Edum Banso which were acquired as part of the incorporation of the Ghana company, DGGL.
The acquisition of DGGL was accounted for as a business combination. Given the short time frame since incorporation (April 7, 2011) and the limited transactions (issuance of members shares and acquisition of mineral property) that occurred in DGGL prior to the acquisition date, we did not furnish pro forma information.
Item 1. Business
2.
Please provide disclosure with respect to all material relationships that existed between Norman Cay Development, Inc. and its affiliates, on the one hand, and Discovery Gold Ghana Limited and its affiliates, on the other hand, at the time of share exchange agreement. Refer to Item 2.01(c) and (d) of Form 8-K. If no such relationships existed, explain how the parties were introduced and decided to proceed with the transaction. Identify any third parties that played a material role in arranging or facilitating the transactions. Finally, identify any promoters as required by Item 404(c) of Regulation S-K.
Response:
There were no material relationships that existed between Norman Cay Development, Inc. (“NCDL”) and its affiliates, Discovery Gold Ghana Limited (“DGGL”) and its affiliates at the time of the execution of the share exchange agreement dated September 2, 2011. Shelley Guidarelli, the controlling shareholder of NCDL and Donald Ross, the controlling shareholder of DGGL are longtime friends and both parties considered the transaction mutually beneficial. As such, their legal counsel prepared the agreement for each party to execute. No promoters were involved in the transaction.
3.
Please discuss the January 25, 2012 earn-in agreement between North Springs Resources Corp. and Discovery Gold Ghana Limited. Provide disclosure with respect to all material relationships that existed between Norman Cay Development, Inc. and its affiliates, Discovery Gold Ghana Limited and its affiliates, and North Springs Resources Corp. and its affiliated at the time of the earn-in agreement. If no such relationships existed, explain how the parties were introduced and decided to proceed with the transaction. Identify any third parties that played a material role in arranging or facilitating the transaction.
Response:
There were no material relationships that existed between NCDL and its affiliates, DGGL and its affiliates, and North Springs Resources Corp. (“NSRS”) and its affiliates at the time of the earn-in agreement. NCDL and DGGL were introduced to NSRS through Gerry Bellanger of Live Call Investor Relations Company located in Toronto, Canada, the investor relations firm for both NCDL and NSRS.
Gerry Bellanger introduced Harry Lapa, President of NSRS, to Dean Huge, Chief Financial Officer of NCDL and Donald Ross, director of NCDL and President of DGGL. NCDL was in need of financial resources for development and believed the terms of financing under the earn-in agreement favorable to the Company. NSRS, on the other hand, considered the transaction a good investment opportunity. Thus the parties proceeded to consummate the transaction.
The earn-in agreement and related documents were prepared by the counsels for NCDL and NSRS.
4.
We note your references on pages 4 and 5 to the Prospecting License, Adom Option Agreement, and Option Assignment Agreement. Please file these agreements as material contracts.
Response:
We have filed these agreements as material contracts in the Amendment No. 2 to Form 8-K.
5.
Please discuss why the transaction for the assignment of the option to acquire all rights to the prospecting license held by Adom Mining Ltd. was structured in two transactions: (1) the August 27, 2011 assignment of the option from Xtra-Gold Exploration Limited to Discovery Gold Ghana Limited (“DGG”) for $250,000 and 5.71% of the common stock of DGG; and (2) the September 2, 2011 acquisition of DGG by Norman Cay Development, Inc. for $100,000 and 17.5 million shares of Norman Cay Development common stock. In your discussion, address whether the option and the prospecting license must held by a company organized in Ghana.
Response:
All mining concessions located in Ghana must be owned by a Ghana corporation and the prospecting license and the option to acquire all rights to the prospecting license must be held by a Ghana corporation. Therefore, Norman Cay Development, Inc., a Nevada corporation, is not permitted to hold the prospecting license and the option. As a result, the transaction for the assignment of the option to acquire all rights to the prospecting license held by Adom Mining Ltd. was structured in two transactions: (1) the August 27, 2011 assignment of the option from Xtra-Gold Exploration Limited to Discovery Gold Ghana Limited; and (2) the September 2, 2011 acquisition of DGG by Norman Cay Development, Inc.
6.
Disclose whether the government of Ghana consented to the assignment from Adom Mining Ltd. to Discovery Gold Ghana of the option to acquire rights to the prospecting license covering the Edum Banso Concession. We note the following disclosure on page 4: “Under the License, Adom had the right to (i) assign or mortgage its interest in the License, subject to obtaining the consent of the Government of Ghana who may impose certain conditions in connection therewith…” Identify the government entity that consented to the assignment of the option and the date of consent. File the consent as a material contract. Also disclose whether the acquisition of Discovery Gold Ghana by Norman Cay Development (and thus the acquisition of the assigned option by a U.S. company) needed government consent.
Response:
Following an application made by Xtra-Gold Exploration Limited (“Xtra-Gold Ghana”) on April 4, 2012, a formal approval of the Option Assignment Agreement was given by the Minerals Commission (“Mincom”) of Ghana by a letter dated May 4, 2012. Discovery Gold Ghana is required to pay a consideration fee of US$10,000 to Mincom to enable Mincom to recommend the assignment of the option rights for ministerial consent which is expected to be granted within 30 days from the date of the Mincom recommendation. The Minister is required under the Mining Act to act upon the recommendation of Mincom. A copy of the letter from Mincom dated May 4, 2012 has been filed as an exhibit to the Amendment No. 2 to Form 8-K.
The acquisition of Discovery Gold Ghana by Norman Cay Development in September 2011 pursuant to the Share Exchange Agreement did not require Ghana government regulatory consent under the Mining Act or any other applicable legislation of Ghana.
We have added discussion on governmental consent regarding the assignment of option rights and the acquisition of Discovery Gold Ghana by Norman Cay Development in the Amendment No.2 to Form 8-K as follows, with the changes underlined for your ease of reference.
Share Exchange Agreement
On September 2, 2011, Norman Cay Development, Inc., a Nevada corporation (the “Company”) entered into a certain Share Exchange Agreement (the “Share Exchange Agreement”) by and among the Company, Discovery Gold Ghana Limited, a company organized under the laws of the country of Ghana (“DGG”), the stockholders of DGG (the “DGG Stockholders”), and the majority stockholder of the Company. Pursuant to the Share Exchange Agreement, the Company acquired one hundred percent (100%) of the issued and outstanding ordinary shares of DGG, and in exchange the Company: (i) made a one-time payment of one hundred thousand dollars ($100,000) to DGG and (ii) issued seventeen million five hundred thousand (17,500,000) newly-issued shares of restricted common stock of the Company to the DGG Stockholders resulting in the acquisition of DGG by the Company (the “Acquisition”). The Company determined that the Acquisition will allow the Company to move forward with its new business plan to conduct mineral exploration activities. As a result of closing the Share Exchange Agreement, the Company has acquired DGG, as its wholly-owned subsidiary, and thus has acquired the Option to acquire the mineral rights to the Edum Banso Concession in Ghana in the South Western Region of West Africa (the “Option”). The acquisition of DGG and thus the acquisition of the Option right by the Company did not require Ghana government regulatory consent under the Mining Act or any other applicable legislation of Ghana.
Option Assignment Agreement
On August 27, 2011, DGG entered into an Agreement for Assignment of Option Interest (the “Option Assignment Agreement”), by and among XGEL, Xtra Gold (collectively XGEL and Xtra Gold are referred to hereinafter as “Xtra-Gold Resources”), Adom and DGG, pursuant to which DGG was assigned the exclusive Option, for those mineral rights related to the Property. Pursuant to the terms thereof, Xtra-Gold Resources sold, assigned and transferred 100% of its right, title and interest in to the Option to DGG. Adom agreed to the assignment. In exchange for the Option, Xtra Gold Resources was to receive: (i) an aggregate payment of two hundred fifty thousand dollars ($250,000), and (ii) a one-time issuance of DGG’s common stock, representing 5.71% of the issued and outstanding common stock of DGG at the time of the issuance.
Following an application made by XGEL on April 4, 2012, a formal approval of the Option Assignment Agreement was given by the Minerals Commission (“Mincom”) of Ghana by a letter dated May 4, 2012. DGG is required to pay a consideration fee of US$10,000 to Mincom to enable Mincom to recommend the assignment of the option rights for ministerial consent which is expected to be granted within 30 days from the date of the Mincom recommendation. The Minister is required under the Mining Act to act upon the recommendation of Mincom.
7.
Please clarify throughout your disclosure that DGG holds an option to acquire the rights to Adom Mining’s license to prospect the Edum Banso Concession, but not the rights to a license to mine or participate in mining the property. Disclose, if true, that Adom Mining does not have a license to mine or participate in the mining of the property. Explain the distinction and its impact on the ability to develop and mine the property. Disclose whether and how DGG could obtain a license to mine the property.
Response:
We have included in the following discussion on the prospecting license in the Amendment No. 2 to the Form 8-K.
The license currently held by Adom and optioned first to Xtra-Gold and now to Discovery is a prospecting license to search for and prove gold within the area covered by the license. The holder of a prospecting license has the right by itself or through sub-contractors or agents to conduct such geological and geophysical investigation within the license area as it considers necessary to determine the existence of an adequate quantity of geologically proven and mineable reserve of gold in the license area.
The holder of a prospecting license does not have the rights to mine or participate in mining the property covered by the license. If the prospecting activities of a prospecting license holder result in the discovery of commercially recoverable reserves of gold within the license area, the holder has the first option under the Mining Act to apply to the Government of Ghana for a mining lease to exploit such commercially recoverable deposits of gold. As part of the requirements for the grant of a mining lease, the holder will have to submit a feasibility report on the gold deposits to the Government of Ghana for approval and also conduct an environmental impact assessment (“EIA”) on the proposed gold development project for approval by the Environmental Protection Agency (“EPA”). Upon approval of the EIA, the EPA will issue an Environmental Permit to the holder prior to the commencement of the mining operations.
If DGG exercises the option to acquire all rights under the prospecting license and becomes the holder of prospecting license, DGG may apply to the Government of Ghana for a license to mine the property provided that the requirements for a mining lease are satisfied.
8.
We note from your disclosure in the first paragraph on page 4 that there is a gap in the extension of Adom Mining’s prospecting license from July 20, 2008 to July 21, 2011, when the government of Ghana extended the license to July 20, 2012. Please disclose the status of the prospecting license to the Edum Banso Concession during this period.
Response:
We attach herewith copies of the extensions granted to the Adom Edum Banso Prospecting License between in 2009 and 2011, prior to the grant of the current extension to July 20, 2013.
We have revised our disclosure in the Amendment No. 2 to Form 8-K as follows, with the changes redlined for your ease of reference:
The Property
Prospecting Rights
The Prospecting License
On May 8, 1991, Adom Mining Ltd. (“Adom”), a 100% wholly registered Ghanaian company, was granted a prospecting license (the “License”) by the Government of Ghana covering the Property. Under the terms and conditions of the License, Adom was given the right to prospect for and prove gold under or in the Property including the right to conduct such geological and geophysical investigations in the Property in order to determine an adequate quantity of geologically proven and mineable reserve of gold (directly or through agents, contractors or sub-contractors). Under the License, Adom had the right to (i) assign or mortgage its interest in the License, subject to obtaining the consent of the Government of Ghana who may impose certain conditions in connection therewith; (ii) surrender its interest in the License; and (iii) renew the term of the License for a period of two years or such other renewal period as may be granted in accordance with applicable mining laws of Ghana. The License granted to Adom was originally set to expire on or about July 2006. On July 27, 2006, the Government of Ghana approved extension of the License to July 20, 2008, which was further extended to November 30, 2010. On September 24, 2010, an application was made for renewal of the License and on July 21, 2011, the Government of Ghana approved the application and extended the License for an additi
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CORRESP
1
filename1.htm
normancay-corresp051112.htm
May 11, 2012
VIA EDGAR
Ajay Koduri
Securities and Exchange Commission
Division of Corporation Finance
100 F Street N.E.
Washington DC 20549
Re:
Norman Cay Development, Inc.
Form 10-Q for the quarter ended January 31, 2012
Filed March 14, 2012
Form 8-K dated January 23, 2012
Filed January 30, 2012
Response letter dated March 5, 2012
File No. 333-167284
We are responding to comments contained in the Staff letter, dated April 4, 2012, addressed to Shelley Guidarelli, former President of the Company, with respect to the Company’s Form 10-Q for the quarter ended January 31, 2012, filed with the Securities and Exchange Commission (the “SEC”) on March 14, 2012, Form 8-K dated January 23, 2012 filed on January 30, 2012 and response letter dated March 5, 2012.
The Company has replied below on a comment by comment basis, with each response following a repetition of the Staff’s comment to which it applies (the “Comments”). The responses to the Comments are numbered to relate to the corresponding Comments in your letter.
Form 8-K filed on January 30, 2012
Form 8-K/A dated October 14, 2011, incorporated therein by reference
1.
According to the last paragraph of page 2, you acquired 100% of the shares of Discovery Gold Ghana Limited on September 2, 2011. Tell us about your consideration of whether Rule 8-04 of Regulation S-X required you to furnish financial statements and any pro forma information specified by Rule 8-05 of Regulation S-X.
Response:
Upon the acquisition of Discovery Gold Ghana Limited (“DGGL”), the assets of DGGL comprised the original members’ shares issued to incorporate the company, and the assets of Edum Banso which were acquired as part of the incorporation of the Ghana company, DGGL.
The acquisition of DGGL was accounted for as a business combination. Given the short time frame since incorporation (April 7, 2011) and the limited transactions (issuance of members shares and acquisition of mineral property) that occurred in DGGL prior to the acquisition date, we did not furnish pro forma information.
Item 1. Business
2.
Please provide disclosure with respect to all material relationships that existed between Norman Cay Development, Inc. and its affiliates, on the one hand, and Discovery Gold Ghana Limited and its affiliates, on the other hand, at the time of share exchange agreement. Refer to Item 2.01(c) and (d) of Form 8-K. If no such relationships existed, explain how the parties were introduced and decided to proceed with the transaction. Identify any third parties that played a material role in arranging or facilitating the transactions. Finally, identify any promoters as required by Item 404(c) of Regulation S-K.
Response:
There were no material relationships that existed between Norman Cay Development, Inc. (“NCDL”) and its affiliates, Discovery Gold Ghana Limited (“DGGL”) and its affiliates at the time of the execution of the share exchange agreement dated September 2, 2011. Shelley Guidarelli, the controlling shareholder of NCDL and Donald Ross, the controlling shareholder of DGGL are longtime friends and both parties considered the transaction mutually beneficial. As such, their legal counsel prepared the agreement for each party to execute. No promoters were involved in the transaction.
3.
Please discuss the January 25, 2012 earn-in agreement between North Springs Resources Corp. and Discovery Gold Ghana Limited. Provide disclosure with respect to all material relationships that existed between Norman Cay Development, Inc. and its affiliates, Discovery Gold Ghana Limited and its affiliates, and North Springs Resources Corp. and its affiliated at the time of the earn-in agreement. If no such relationships existed, explain how the parties were introduced and decided to proceed with the transaction. Identify any third parties that played a material role in arranging or facilitating the transaction.
Response:
There were no material relationships that existed between NCDL and its affiliates, DGGL and its affiliates, and North Springs Resources Corp. (“NSRS”) and its affiliates at the time of the earn-in agreement. NCDL and DGGL were introduced to NSRS through Gerry Bellanger of Live Call Investor Relations Company located in Toronto, Canada, the investor relations firm for both NCDL and NSRS.
Gerry Bellanger introduced Harry Lapa, President of NSRS, to Dean Huge, Chief Financial Officer of NCDL and Donald Ross, director of NCDL and President of DGGL. NCDL was in need of financial resources for development and believed the terms of financing under the earn-in agreement favorable to the Company. NSRS, on the other hand, considered the transaction a good investment opportunity. Thus the parties proceeded to consummate the transaction.
The earn-in agreement and related documents were prepared by the counsels for NCDL and NSRS.
4.
We note your references on pages 4 and 5 to the Prospecting License, Adom Option Agreement, and Option Assignment Agreement. Please file these agreements as material contracts.
Response:
We have filed these agreements as material contracts in the Amendment No. 2 to Form 8-K.
5.
Please discuss why the transaction for the assignment of the option to acquire all rights to the prospecting license held by Adom Mining Ltd. was structured in two transactions: (1) the August 27, 2011 assignment of the option from Xtra-Gold Exploration Limited to Discovery Gold Ghana Limited (“DGG”) for $250,000 and 5.71% of the common stock of DGG; and (2) the September 2, 2011 acquisition of DGG by Norman Cay Development, Inc. for $100,000 and 17.5 million shares of Norman Cay Development common stock. In your discussion, address whether the option and the prospecting license must held by a company organized in Ghana.
Response:
All mining concessions located in Ghana must be owned by a Ghana corporation and the prospecting license and the option to acquire all rights to the prospecting license must be held by a Ghana corporation. Therefore, Norman Cay Development, Inc., a Nevada corporation, is not permitted to hold the prospecting license and the option. As a result, the transaction for the assignment of the option to acquire all rights to the prospecting license held by Adom Mining Ltd. was structured in two transactions: (1) the August 27, 2011 assignment of the option from Xtra-Gold Exploration Limited to Discovery Gold Ghana Limited; and (2) the September 2, 2011 acquisition of DGG by Norman Cay Development, Inc.
6.
Disclose whether the government of Ghana consented to the assignment from Adom Mining Ltd. to Discovery Gold Ghana of the option to acquire rights to the prospecting license covering the Edum Banso Concession. We note the following disclosure on page 4: “Under the License, Adom had the right to (i) assign or mortgage its interest in the License, subject to obtaining the consent of the Government of Ghana who may impose certain conditions in connection therewith…” Identify the government entity that consented to the assignment of the option and the date of consent. File the consent as a material contract. Also disclose whether the acquisition of Discovery Gold Ghana by Norman Cay Development (and thus the acquisition of the assigned option by a U.S. company) needed government consent.
Response:
Following an application made by Xtra-Gold Exploration Limited (“Xtra-Gold Ghana”) on April 4, 2012, a formal approval of the Option Assignment Agreement was given by the Minerals Commission (“Mincom”) of Ghana by a letter dated May 4, 2012. Discovery Gold Ghana is required to pay a consideration fee of US$10,000 to Mincom to enable Mincom to recommend the assignment of the option rights for ministerial consent which is expected to be granted within 30 days from the date of the Mincom recommendation. The Minister is required under the Mining Act to act upon the recommendation of Mincom. A copy of the letter from Mincom dated May 4, 2012 has been filed as an exhibit to the Amendment No. 2 to Form 8-K.
The acquisition of Discovery Gold Ghana by Norman Cay Development in September 2011 pursuant to the Share Exchange Agreement did not require Ghana government regulatory consent under the Mining Act or any other applicable legislation of Ghana.
We have added discussion on governmental consent regarding the assignment of option rights and the acquisition of Discovery Gold Ghana by Norman Cay Development in the Amendment No.2 to Form 8-K as follows, with the changes underlined for your ease of reference.
Share Exchange Agreement
On September 2, 2011, Norman Cay Development, Inc., a Nevada corporation (the “Company”) entered into a certain Share Exchange Agreement (the “Share Exchange Agreement”) by and among the Company, Discovery Gold Ghana Limited, a company organized under the laws of the country of Ghana (“DGG”), the stockholders of DGG (the “DGG Stockholders”), and the majority stockholder of the Company. Pursuant to the Share Exchange Agreement, the Company acquired one hundred percent (100%) of the issued and outstanding ordinary shares of DGG, and in exchange the Company: (i) made a one-time payment of one hundred thousand dollars ($100,000) to DGG and (ii) issued seventeen million five hundred thousand (17,500,000) newly-issued shares of restricted common stock of the Company to the DGG Stockholders resulting in the acquisition of DGG by the Company (the “Acquisition”). The Company determined that the Acquisition will allow the Company to move forward with its new business plan to conduct mineral exploration activities. As a result of closing the Share Exchange Agreement, the Company has acquired DGG, as its wholly-owned subsidiary, and thus has acquired the Option to acquire the mineral rights to the Edum Banso Concession in Ghana in the South Western Region of West Africa (the “Option”). The acquisition of DGG and thus the acquisition of the Option right by the Company did not require Ghana government regulatory consent under the Mining Act or any other applicable legislation of Ghana.
Option Assignment Agreement
On August 27, 2011, DGG entered into an Agreement for Assignment of Option Interest (the “Option Assignment Agreement”), by and among XGEL, Xtra Gold (collectively XGEL and Xtra Gold are referred to hereinafter as “Xtra-Gold Resources”), Adom and DGG, pursuant to which DGG was assigned the exclusive Option, for those mineral rights related to the Property. Pursuant to the terms thereof, Xtra-Gold Resources sold, assigned and transferred 100% of its right, title and interest in to the Option to DGG. Adom agreed to the assignment. In exchange for the Option, Xtra Gold Resources was to receive: (i) an aggregate payment of two hundred fifty thousand dollars ($250,000), and (ii) a one-time issuance of DGG’s common stock, representing 5.71% of the issued and outstanding common stock of DGG at the time of the issuance.
Following an application made by XGEL on April 4, 2012, a formal approval of the Option Assignment Agreement was given by the Minerals Commission (“Mincom”) of Ghana by a letter dated May 4, 2012. DGG is required to pay a consideration fee of US$10,000 to Mincom to enable Mincom to recommend the assignment of the option rights for ministerial consent which is expected to be granted within 30 days from the date of the Mincom recommendation. The Minister is required under the Mining Act to act upon the recommendation of Mincom.
7.
Please clarify throughout your disclosure that DGG holds an option to acquire the rights to Adom Mining’s license to prospect the Edum Banso Concession, but not the rights to a license to mine or participate in mining the property. Disclose, if true, that Adom Mining does not have a license to mine or participate in the mining of the property. Explain the distinction and its impact on the ability to develop and mine the property. Disclose whether and how DGG could obtain a license to mine the property.
Response:
We have included in the following discussion on the prospecting license in the Amendment No. 2 to the Form 8-K.
The license currently held by Adom and optioned first to Xtra-Gold and now to Discovery is a prospecting license to search for and prove gold within the area covered by the license. The holder of a prospecting license has the right by itself or through sub-contractors or agents to conduct such geological and geophysical investigation within the license area as it considers necessary to determine the existence of an adequate quantity of geologically proven and mineable reserve of gold in the license area.
The holder of a prospecting license does not have the rights to mine or participate in mining the property covered by the license. If the prospecting activities of a prospecting license holder result in the discovery of commercially recoverable reserves of gold within the license area, the holder has the first option under the Mining Act to apply to the Government of Ghana for a mining lease to exploit such commercially recoverable deposits of gold. As part of the requirements for the grant of a mining lease, the holder will have to submit a feasibility report on the gold deposits to the Government of Ghana for approval and also conduct an environmental impact assessment (“EIA”) on the proposed gold development project for approval by the Environmental Protection Agency (“EPA”). Upon approval of the EIA, the EPA will issue an Environmental Permit to the holder prior to the commencement of the mining operations.
If DGG exercises the option to acquire all rights under the prospecting license and becomes the holder of prospecting license, DGG may apply to the Government of Ghana for a license to mine the property provided that the requirements for a mining lease are satisfied.
8.
We note from your disclosure in the first paragraph on page 4 that there is a gap in the extension of Adom Mining’s prospecting license from July 20, 2008 to July 21, 2011, when the government of Ghana extended the license to July 20, 2012. Please disclose the status of the prospecting license to the Edum Banso Concession during this period.
Response:
We attach herewith copies of the extensions granted to the Adom Edum Banso Prospecting License between in 2009 and 2011, prior to the grant of the current extension to July 20, 2013.
We have revised our disclosure in the Amendment No. 2 to Form 8-K as follows, with the changes redlined for your ease of reference:
The Property
Prospecting Rights
The Prospecting License
On May 8, 1991, Adom Mining Ltd. (“Adom”), a 100% wholly registered Ghanaian company, was granted a prospecting license (the “License”) by the Government of Ghana covering the Property. Under the terms and conditions of the License, Adom was given the right to prospect for and prove gold under or in the Property including the right to conduct such geological and geophysical investigations in the Property in order to determine an adequate quantity of geologically proven and mineable reserve of gold (directly or through agents, contractors or sub-contractors). Under the License, Adom had the right to (i) assign or mortgage its interest in the License, subject to obtaining the consent of the Government of Ghana who may impose certain conditions in connection therewith; (ii) surrender its interest in the License; and (iii) renew the term of the License for a period of two years or such other renewal period as may be granted in accordance with applicable mining laws of Ghana. The License granted to Adom was originally set to expire on or about July 2006. On July 27, 2006, the Government of Ghana approved extension of the License to July 20, 2008, which was further extended to November 30, 2010. On September 24, 2010, an application was made for renewal of the License and on July 21, 2011, the Government of Ghana approved the application and extended the License for an additi