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UNITED STATES FORM 10-K
[ X ] ANNUAL REPORT UNDER SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [ ] TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE EXCHANGE ACT Commission file number: 000-53845
Indicate by check mark if the registrant is a well-known
seasoned issuer as defined by Rule 405 of the Securities Act (the Act or
Securities Act) Yes [ ] No [X]. Indicate by check mark if the registrant is not required
to file reports pursuant to Rule 13 or Section 15(d) of the Act Yes
[ ] No [X] Indicate by check mark whether the
issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of
the Exchange Act during the past 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 Rule 405 of Regulation
S-T (s 220.405 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 [X] No [ ] Check if disclosure of
delinquent filers in response to Item 405 of Regulation S-K is not contained in
this form, and no disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.
[ ] Indicate by check mark whether the registrant
is a large accelerated filer, a non-accelerated filer or a smaller reporter. Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No
[ ] Issuer's revenues for its most recent fiscal year: $0. The aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which the
common equity was sold, or the average bid and asked price of such common
equity, as of the last business day of the registrants most recently completed
fiscal quarter: 7,900,000 common shares at $0.91* = $7,189,000. (* - last price
at which the Corporations stock traded on the OTC-BB under the symbol
THRO). 2 (APPLICABLE ONLY TO CORPORATE REGISTRANTS) State the number of shares outstanding of each of the Issuer's
classes of common stock, as of the latest practicable date: 7,900,000 common
shares issued and outstanding as of the date of this report. Transitional Small Business Disclosure Format (Check one): Yes
[ ] No [X] DOCUMENTS INCORPORATED BY REFERENCE List hereunder the following documents if incorporated by
reference and the Part of the Form 10-K into which the document is incorporated:
(1) any annual report to shareholders; (2) any proxy or information statement
and (3) any prospectus filed pursuant to Rule 424(b) or (c) under the Securities
Act of 1933, as amended (the Securities Act): Cautionary Statement Regarding Forward-Looking
Statements This annual report contains forward-looking statements as that
term is defined in the Private Securities Litigation Reform Act of 1995. These
statements relate to future events or our future financial performance. Some
discussions in this report may contain forward-looking statements that involve
risk and uncertainty. A number of important factors could cause our actual
results to differ materially from those expressed in any forward-looking
statements made in this report. Forward-looking statements are often identified
by words like: believe, expect, estimate, anticipate,
intend, project and similar expressions or words which, by their nature,
refer to future events. 3 In some cases, you can also identify forward-looking statements
by terminology such as may, will, should, plans, predicts, potential
or continue or the negative of these terms or other comparable terminology.
These statements are only predictions and involve known and unknown risks,
uncertainties and other factors, including the risks in the section entitled
Risk Factors, beginning on page 4, that may cause our or our industry's actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity or achievements. Except as required by applicable law,
including the securities laws of the United States, we do not intend to update
any of the forward-looking statements to conform these statements to actual
results. Our financial statements are stated in United States Dollars
(US$) and are prepared in accordance with United States Generally Accepted
Accounting Principles. References to common shares refer to common shares in our
capital stock. As used in this annual report, the terms we, us, our, and
Theron mean Theron Resource Group unless otherwise indicated. Theron is an exploration stage Corporation. There is no
assurance that commercially viable mineral deposits exist on the claims we have
under option. Further exploration and/or drilling will be required before a
final evaluation as to the economic and legal feasibility of our projects is
determined. Glossary of Exploration Terms The following terms, when used in this report, have the
respective meanings specified below: We were incorporated in the State of Wyoming on April 11, 2006,
as Theron Resource Group and established a fiscal year end of May 31. Our
statutory registered agent's office is located at 1620 Central Avenue, Suite
202, Cheyenne, Wyoming 82001 and our business office is located at 1596 Gulf
Road, Number 34, Point Roberts, Washington 98281; telephone (888) 755-9766. There have been no material reclassifications, mergers,
consolidations or purchases or sales of any significant amount of assets not in
the ordinary course of business since the date of incorporation. We are a
start-up, exploration stage company engaged in the search for gold and related
minerals. There is no assurance that a commercially viable mineral deposit, a
reserve, exists in our claim or can be shown to exist until sufficient and
appropriate exploration is done and a comprehensive evaluation of such work
concludes economic and legal feasibility. The reader of this periodic report is directed to our Form 10-K
Report for May 31, 2009, dated September 8, 2009, and our S-1 registration
statement dated April 3, 2009, for further discussion of the property, mineral
exploration in Canada, geology and other background information on the optioned
property. Our Current Business Mineral Exploration On February 21, 2007, we optioned a property containing six
mineral claim blocks in south-western B. C. by entering into an Option To
Purchase And Royalty Agreement with Bryan Livgard, the beneficial owner of the
claims, an arms-length B.C. resident, to acquire the claims by making certain
expenditures and carrying out certain exploration work. The phase I exploration program on the George property
commenced on April 30, 2009, and was completed on June 04, 2009, under the
supervision of Egil Livgard, P. Eng., the author of the initial geological and
engineering report on the project. Our portion of the phase I geological
exploration program on the property cost $20,000 which is a reflection of local
costs for the specified type of work. The Assessment Report on the work carried
out on the Claims was received in late May, 2010 and called for a Phase II work
program which will cost an estimated $155,000. We are currently reviewing the
recommendation and seeking financing for moving forward with the project; no
decisions have yet been made and no expressions of interest in assisting with
the financing have been received to this date. Our Proposed Exploration Program Plan of Operation Our business plan is to proceed with seeking the necessary
capital to complete the recommended phase II program on the George claims to
determine if there are commercially exploitable deposits of gold. We must
conduct exploration to determine if gold exists on the property and if any is
found it can be economically extracted and profitably processed. We do not claim
to have any ores or reserves whatsoever at this time on our optioned property.
For a detailed discussion of the results of the phase I portion of the
exploration program and our plan of operation, refer to page 8 Plan of
Operation Results of Operations. Risks Associated with Theron Resource Group, Our
Financial Condition and Our Business Model 1. We are an exploration stage corporation, lack a
business history and have losses that we expect to continue into the future. If
the losses continue we will have to suspend operations or cease
functioning. 5 We were incorporated on April 11, 2006. Although we have
started our proposed business and have completed the first phase of exploration
of our optioned mineral project, we have not realized any revenues. We have no
business history upon which an evaluation of our future success or failure can
be made. Our net loss since inception is $85,328. Our ability to achieve and
maintain profitability and positive cash flow is dependent upon: Based upon current plans, we expect to incur losses in future
periods. This will happen because there are expenses associated with the
exploration of our optioned property. We may not be successful in generating
revenues in the future. Failure to generate revenues will cause us to go out of
business. 2. We have no known mineral reserves and we may not find
any gold or if we find gold it may not be in economic quantities. If we fail to
find any gold or if we are unable to find gold in economic quantities, we will
have to suspend operations. The worldwide mining industry is founded upon small parcels of
land being explored by junior exploration entities while the chances of finding
reserves on any individual prospect is almost infinitesimal. It is not uncommon
to spend millions of dollars on a potential project, complete many phases of
exploration and still not obtain reserves that can be economically exploited.
Therefore, the chances of Therons property having mineral reserves are
remote. We have no known mineral reserves. Even if we find gold it may
not be of sufficient quantity so as to warrant recovery. Additionally, even if
we find gold in sufficient quantity to warrant recovery it ultimately may not be
recoverable. Finally, even if any gold is recoverable, we do not know that this
can be done at a profit. Failure to locate deposits in economically recoverable
quantities will cause us to cease operations. 3. We require substantial funds merely to determine if
mineral reserves exist on our optioned property. Any potential development and production of our exploration
properties depends upon the results of exploration programs and/or feasibility
studies and the recommendations of duly qualified engineers and geologists. Such
programs require substantial additional funds. Any decision to further expand
our plans on these exploration properties will involve the consideration and
evaluation of several significant factors including, but not limited to: 4. Titles to the claims are registered in the name of
another person. In order to exercise our rights under the option agreement we
must incur certain exploration costs and make royalty payments. Our failure to
incur the exploration expenditures or to make the royalty payments will result
in forfeiture of our right to acquire the claims and will result in our having
to cease operations. Title to the claims we intend to explore is not held in our
name but rather that of the estate of Bryan Livgard, a resident of B.C.,
recently deceased. In the event Livgards estate were to grant another person a
deed of ownership which was subsequently registered prior to our deed, the third
party would obtain good title and we would have nothing. Similarly, if he were
to grant an option to another party, that party would be able to enter the
claims, carry out certain work commitments and earn right and title to the
claims and we would have little recourse as we would be harmed, will not own any
property and would have to cease operations. The option agreement does not
specifically reference these risks or the recourse provided. 6 Although we would have recourse against Livgard or his estate,
under common law, there is a question as to whether that recourse would have
specific value. Under the terms of an option agreement, Theron has the right to
acquire the title to the claims upon incurring exploration expenses on the
claims of a minimum of $20,000 by August 31, 2009, (paid) incurring additional
exploration expenses in the amount of $40,000 by August 31, 2010 and making
annual advance on royalty payments in the amount of $25,000 commencing May 31,
2011. Failure by Theron to make any of the payments or failure to incur the
required exploration expenses will result in the loss of the option to acquire
the claims in which case Theron will have to cease operations. 5. Management will devote only a limited amount of time
to Therons business. Failure of our management to devote a sufficient amount of
time to our business plans may adversely affect the success of our business,
plus which management lacks formal training in mineral exploration. Because Jerry R. Satchwell, our President and CEO, will be
devoting only approximately 6 hours per week to our business plans, our business
may suffer. As a result, exploration of the property may be periodically
interrupted or suspended. Interruptions to, or suspension of, exploration may
cause us to cease operations. Mr. Satchwell has no professional accreditation or formal
training in the business of exploration. With no direct training or experience
in these areas our management may not be fully aware of many of the specific
requirements related to working within this industry. Decisions so made without
this knowledge may not take into account standard engineering management
approaches that experienced exploration corporations commonly make.
Consequently, our business, earnings and ultimate financial success could suffer
irreparable harm as a result of managements lack of experience in the industry.
Thus, we will retain such technical experts as are required to provide
professional and technical guidance. ITEM
1B. UNRESOLVED
STAFF COMMENTS As of the date of this report, there are no unresolved comments
pending from the SEC. Our principal office is located at 1596 Gulf Road, Number 34,
Point Roberts, Washington 98281. Our telephone number is (888) 755-9766. Our
principal office is provided by our officer and director at no cost. We believe
that the condition of our principal office is satisfactory, suitable and
adequate for current needs. We hold an option on a gold exploration and mining property
known as the George claims containing six mineral claim blocks in south-western
B. C. We entered into an Option To Purchase And Royalty Agreement with Bryan
Livgard, the beneficial owner of the claims, an arms-length B.C. resident, to
acquire the claims by making certain expenditures and carrying out certain
exploration work. We know of no material, existing or pending legal proceedings
against us, nor are we involved as a plaintiff in any material proceeding or
pending litigation. There are no proceedings in which any of our directors,
officers or affiliates, or any registered or beneficial shareholder, is an
adverse party or has a material interest adverse to Theron. ITEM
4. SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS Our last annual general meeting was held on November 25, 2009,
at which time stockholders approved the following actions: 7 PART II Shares of our common stock became available for quotation on
the Over-the-Counter •in Board (the OTC-BB) under the symbol THRO on
December 17, 2009. The market for our common shares is limited and can be
volatile. The following table sets forth the high and low bid prices relating to
our common stock on a quarterly basis for the periods indicated as quoted on the
OTC-BB quotation service. These quotations reflect inter-dealer prices without
retail mark-up, mark-down or commissions and may not reflect actual
transactions. As of the date of this report, we had 5 shareholders of record
whose shares are held in street or nominee names. There are 7,900,000 shares
outstanding. Our common shares are issued in registered form. Olde Monmouth
Stock Transfer Co., Inc., of 200 Memorial Parkway, Atlantic Highlands, NJ 07716
is our stock transfer agent and can be contacted by telephone at (732) 872-2727
and by facsimile at (732) 872-2728. We have not declared any dividends since incorporation and do
not anticipate that we will do so in the foreseeable future. Although there are
no restrictions that limit the ability to pay dividends on our common shares,
our intention is to retain future earnings for use in our operations and the
expansion of our business. Item
6. SELECTED
FINANCIAL DATA As a smaller reporting company, we are not required to
provide the information required by this Item. Item
7.
MANAGEMENTS DISCUSSION and ANALYSIS OF FINANCIAL CONDITION and
RESULTS OF OPERATIONS The following discussion should be read in conjunction with our
audited financial statements and the related notes that appear elsewhere in this
Annual Report. The following 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 such differences include, but are not limited to
those discussed below and elsewhere in this Annual Report, particularly in the
section entitled Risk Factors. We are an exploration stage company and have not generated any
revenue to date. We have incurred recurring losses to date. Our financial
statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments
relating to the recoverability and realization of assets and classification of
liabilities that might be necessary should we be unable to continue in
operation. 8 We were incorporated in the State of Wyoming on April 11, 2006,
as Theron Resource Group and established a fiscal year end of May 31. Our
statutory registered agent's office is located at 1620 Central Avenue, Suite
202, Cheyenne, Wyoming 82001 and our business office is located at 1596 Gulf
Road, Number 34, Point Roberts, Washington 98281; telephone (888) 755-9766. We
are a start-up, exploration stage company engaged in the search for gold and
related minerals. There is no assurance that a commercially viable mineral
deposit, a reserve, exists in our claim or can be shown to exist until
sufficient and appropriate exploration is done and a comprehensive evaluation of
such work concludes economic and legal feasibility. On February 21, 2007, we optioned a property containing six
mineral claim blocks in south-western B. C. by entering into an Option To
Purchase And Royalty Agreement with Bryan Livgard (recently deceased), the
beneficial owner of the claims, to acquire the claims by making certain
expenditures and carrying out exploration work. Under the terms of the agreement, Livgard granted to Theron the
right to acquire 100% of the right, title and interest of Livgard in the
property, subject to his receiving annual payments and a royalty, in accordance
with the terms of the agreement, as follows: To date we have advanced $20,000 for the implementation of
phase I of the planned exploration program of which the field work has been
completed; the final engineering was received in late May 2010. We have not
spent any money on research and development activities. Information regarding
the property was presented to Mr. Satchwell for review without any contractual
obligations. The reader is directed to our Form 10-K Report for May 31,
2009, dated September 8, 2009, and our S-1 registration statement dated April 3,
2009, for further discussion of the property, mineral exploration in Canada,
geology and other background information on the optioned property. Our Proposed Exploration Program Plan of Operation
Results of Operations Our business plan is to continue with exploration of the George
mineral claims to determine if there are commercially exploitable deposits of
gold and silver. We retained the services of the Egil Livgard, P. Eng., to
complete the first phase of the work program and to complete and assess the
results of the program. The option agreement expired on May 31, 2009, but the property
owner has verbally agreed to take no action to terminate the agreement until
such time as we have been able to review the engineering report of the first
phase of the exploration program and are in a position to determine how and when
we will be able to move forward with the project. 9 Evaluation and conclusions Phase I exploration
program The exploration in 2008 and 2009 and that discussed in the
report consisted of further stream silt sampling, two grids of soil sampling,
rock sampling and geological examination. The soil and rock sampling on the
north part of the claims outlined anomalous soil in copper and values of gold
and copper in narrow stringers. Exploration in 2008 consisted of a bark sample
with analysis for halogen gasses in an attempt to reach response from
mineralization at depth. Soil sampling south of the initial survey was carried
out without any positive results. Some geology and further rock sampling was
also done. Lawless Creek is the main creek in the vicinity of the property
and its skarn deposits. The creek flows southerly through all the claims and a
further 16 kilometers to its confluence with the Tulameen River; over this
entire distance the channel is covered with placer claims of which the source
has not been located. Skarn copper-gold deposits on the claims or fracture
deposits are possible sources of gold. The mineral showings on the George claims may perhaps be either
large disseminated copper-gold deposits in rocks altered by an intrusive body,
such as the QR GOLD Mine Deposits in the Cariboo region of B.C. that is found at
the indurated alteration front of the intrusive body about 300 meters away from
the contact, or as massive replacement mineralization in limestone such as at
the Bowser Creek Deposits in Alaska where disseminated silverzinc occurs in
altered limestone or as massive replacement of limestone. The disseminations may
extend over a few kilometers in length and up to 250 meters in width. The three fault intersection on the south-western George claims
did not return notable soil values nor did silt samples in the vicinity. The
only fault exposure that has been found lies about one kilometer distant from
the fault junction on the southwest striking fault branch. The five channel
samples across the exposed part of the fault and one grab sample gave low values
but two were anomalous in copper, and soil samples near the three fault junction
indicate that the southwest fault may carry some mineralization. On the northern part of the claims the rocks have undergone
contact metamorphic alteration with introduction of quartz, pyrite, chalcopyrite
and gold values from near the intrusive contact and up to 400m to perhaps 500m
southwest of the contact. At the B and R showing one narrow sample (7.0 cm) gave
roughly ½ gram gold and 0.15 % copper per tonne and the soil grid outlined
anomalous values that extend south-easterly. Rock samples have located low grade
copper gold values particularly at the Dawn showing. A bark survey covering the Nicola Group rocks from about 150
meters to 450 meters away from the contact to the intrusive rocks has indicated
anomalous values in Br, Cl, F, I, indicators of buried mineralization, at
several locations. The writer concludes that these anomalies warrant exploration
by diamond drilling. The report makes the following recommendations The estimated costs of the above recommendations are as
follows: 10 Phase II will not be carried out until at least late 2010; the
cost estimate is based on local costs for the specified type of work. COMMON SHARES: Since inception we have used common stock and an
advance from a related party to raise money for our optioned mineral acquisition
and corporate expenses. Net cash provided by financing activities in the most
recent fiscal year ended May 31, 2010, was $17,000 as the result of an advance
from a related party. In the fiscal year ended May 31, 2009, cash flows form
financing activity was a negative $3,500 as the result of the repayment of an
outstanding advance ($13,000), an advance from a related party ($1,000) and the
proceeds from the sale of common shares ($8,500). Net cash provided by financing
activities from inception on April 11, 2006 was $83,000 ($65,000 as proceeds
received from sales of our common stock and $18,000 as an advance from an
officer). Revenue We have not earned any revenues since our inception. Expenses Our operating expenses for the year ended May 31, 2010, and
2009 are outlined in the table below: 11 During the year ended May 31, 2010, Theron incurred operating
expenses of $16,555 as compared to $35,834 for the similar period last year and
a total of $85,328 for the period from inception on April 11, 2006, to May 31,
2010. Operating expenses for the year ended May 31, 2010, were reduced by half
as compared to the comparative period in 2009 primarily as a result of the
commencement of our business plan and expenditures associated with the first
phase of the exploration program on the George property in 2009 that were not
repeated in the 2010 fiscal year. The costs incurred can be further subdivided into the following
categories. ACQUISITION OF MINERAL PROPERTY INTEREST: Theron incurred no
costs for mineral property acquisition costs for the fiscal year ended on May
31, 2010, or for the previous fiscal year. From inception to May 31, 2010 we
have incurred $4,242 in costs related to mineral property acquisition. This
expense category will vary depending on mineral interest acquisition
activities. MINERAL PROPERTY EXPLORATION: Theron did not incur costs for
mineral property exploration costs for the fiscal year ended on May 31, 2010, as
compared to $20,082 which was spent in the previous fiscal year. From inception
to May 31, 2010, we have incurred $20,082 in costs related to mineral property
exploration which category will vary depending on our exploration work
activities. GAIN (LOSS) ON FOREIGN EXCHANGE: Our exploration and
acquisition costs and certain expenses have been incurred in Canadian Dollars.
$4 was lost on the exchange of USD to CAD in the fiscal year under review while
nil ($0) was lost for the period ended May 31, 2009. For the period April 11,
2006, (inception) through May 31, 2010, Theron has lost a total of $93 on
foreign exchange transactions. Gains or losses are subject to fluctuations in
the Canadian Dollars relative to the U.S. Dollar and are, largely,
unpredictable. PROFESSIONAL FEES: Theron incurred $6,954 in professional fees
for the fiscal year ended on May 31, 2010 as compared to $5,942 for the previous
fiscal year. From inception to May 31, 2010, we have incurred $31,680 in
professional fees mainly spent on legal and accounting matters. This expense
category will vary depending on corporate capital raising activities. COMMUNICATIONS: $559 in communications costs were incurred in
the fiscal year under review while $1,290 was incurred for the period ended May
31, 2009. For the period April 11, 2006, (inception) through May 31, 2010,
Theron has spent a total of $3,805 on such expenses. OFFICE EXPENSES: $537 in office costs were incurred in the past
year. By comparison, $1,425 was incurred for previous fiscal period ended May
31, 2009. From inception through May 31, 2010, a total of $5,440 has been spent
on office related expenses. Higher costs in the previous fiscal year were the
result of the commencement of our business plan and the relative inactivity in
the current year. TRAVEL AND ENTERTAINMENT COSTS: $1,473 in travel and
entertainment expenses were incurred in fiscal year under review while $2,460
was incurred for the period ended May 31, 2009. For the period April 11, 2006,
(inception) through May 31, 2010, Theron has spent a total of $6,574 on travel
and entertainment and related costs. Higher costs in the previous fiscal year
were the result of the commencement of our business plan and the relative
inactivity in the current year. FILING FEES: We incurred $2,303 in filing costs for the year
ended May 31, 2010, and $4,635 for the period ended May 31, 2009. From inception
through May 31, 2009, $8,637 was recorded for various filing fees including
EDGAR and other related expenses. The category was higher last year as a result
of additional regulatory filings. This category will vary and be dependent on
the level of corporate filings and other regulatory issues. TRANSFER AGENT EXPENSES: $4,725 in transfer agent costs were
incurred in the most recent fiscal year while no such expenses was incurred in
the previous year ended on May 31, 2009. From April 11, 2006 (inception),
through May 31, 2010, $4,725 has been spent on transfer agent costs which in the
future will cost approximately $200 per month plus new share issuance costs. 12 CONTRIBUTED EXPENSES (OTHER SERVICES): No contributed expenses
(for contributed administrative costs) were incurred for the year ended May 31,
2010, and none were incurred in the period ended May 31, 2009. For the period
April 11, 2006 (inception), through May 31, 2009, a total of $50 in contributed
expenses has been reflected in the financial statements. All contributed
expenses are reported as contributed costs with a corresponding credit to
additional paid-in capital. The Corporations president contributed administrative services
to the Corporation for the period to May 31, 2007. The time and effort was
recorded in the accompanying financial statements based on the prevailing rates
for such services, which equalled $50 per hour based on the level of services
performed. RESEARCH AND DEVELOPMENT: Theron has not incurred any expenses
for research and development since inception on April 11, 2006. COMPENSATION: No compensation costs were incurred for the
fiscal year ended on May 31, 2010, and none were incurred in the previous fiscal
year which ended on May 31, 2009. From inception to May 31, 2010, there have
been no charges to the compensation account. INCOME TAX PROVISION: As a result of operating losses, there
has been no provision for the payment of income taxes to date in 2009 - 2010 or
from the date of inception. At the end of the fiscal year under review, May 31, 2010 and
the date of this report, Theron had 7,900,000 common shares issued and
outstanding. Liquidity and Financial Condition As of May 31, 2010, our company had a working capital deficit
of $20,500. Use of Proceeds Net cash provided by financing activities from inception on
April 11, 2006, to May 31, 2010, was $65,000 as a result of proceeds received
from the sale of our common stock and an $18,000 advance from a related party.
During that same period, the following table indicates how those proceeds have
been spent to date: 13 Future Operations Presently, our revenues are not sufficient to meet operating
and capital expenses. We have incurred operating losses since inception, and
this is likely to continue through fiscal 2010 - 2011. Management projects that
we may require $200,000 to fund our ongoing operating expenses and working
capital requirements for the next twelve months, broken down as follows: As at May 31, 2010, we had a working capital deficit of
$20,500. We plan to raise the additional capital required to meet the balance of
our estimated funding requirements for the next twelve months primarily through
the sale of equity based securities. We do not anticipate that we will be able
to satisfy any of these funding requirements internally until we significantly
increase revenues. There is substantial doubt about our ability to continue as a
going concern because our business is dependent upon obtaining further
financing. The issuance of additional equity securities by us could result in a
significant dilution in the equity interests of current stockholders. Obtaining
commercial loans, assuming those loans would be available, will increase our
liabilities and future cash commitments. Future Financings We will require additional financing in order to enable us to
proceed with our plan of operations, as discussed above, and in order to
continue operations. There can be no assurance that additional financing will be
available to us when needed or, if available, that it can be obtained on
commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, we will not be able to meet our other obligations
as they become due. We are pursuing various alternatives to meet our immediate
and long-term financial requirements. We anticipate continuing to rely on equity sales of our common
stock in order to fund our business operations which would result in dilution to
existing stockholders. There is no assurance that we will achieve any sales of
equity securities or arrange for debt or other financing to fund our planned
activities. We presently do not have any arrangements for additional
financing and no potential lines of credit or sources of financing are currently
available for the purpose of proceeding with our plan of operations. Contractual Obligations As a smaller reporting company, we are not required to
provide tabular disclosure obligations. Going Concern We are in the development stage, have not yet achieved
profitable operations and are dependent on our ability to raise capital from
stockholders or other sources to meet obligations arising from normal business
operations when they become due. Therefore, due to the uncertainty of our
ability to meet our current operating and capital expenses, in their report on
the annual financial statements for the year ended May 31, 2010, our independent
auditors included an explanatory paragraph regarding concerns about our ability
to continue as a going concern. Our financial statements contain additional note
disclosures describing the circumstances that lead to this disclosure. Purchase of Significant Equipment We do not intend to purchase any significant equipment during
the next twelve months. 14 Off-Balance Sheet Arrangements We have no off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or
capital resources. Critical Accounting Policies The discussion and analysis of our financial condition and
results of operations are based upon our financial statements, which have been
prepared in accordance with the accounting principles generally accepted in the
United States of America. Preparing financial statements requires management to
make estimates and assumptions that affect the reported amounts of assets,
liabilities, revenue, and expenses. These estimates and assumptions are affected
by managements application of accounting policies. We believe that
understanding the basis and nature of the estimates and assumptions involved
with the following aspects of our financial statements is critical to an
understanding of our financial statements. ASC (Accounting Standards Codification) Topic The FASB
Accounting Standards Codification(TM) and the Hierarchy of Generally Accepted
Accounting Principles A Replacement of FASB Statement No. 162 became
effective on September 15, 2009. This standard establishes the FASB Accounting
Standards Codification (the Codification) as the source of authoritative
accounting principles recognized by the FASB to be applied by nongovernmental
entities in the preparation of financial statements in conformity with US GAAP.
The Codification does not change current US GAAP, but is intended to simplify
user access to all authoritative US GAAP by providing all the authoritative
literature related to a particular topic in one place. As of the effective date,
all existing accounting standard documents were superseded and, accordingly, all
subsequent public filings will reference the Codification as the sole source of
authoritative literature. Functional Currency Cash and Cash Equivalents Financial Instruments Commodity Price Risk: The ability of the Company to
develop its properties and the future profitability of the Company is directly
related to the market price of certain minerals. Foreign Exchange Risk: The Company conducts of its
exploration activities in Canadian dollars. The Company is therefore subject to
gains or losses due to fluctuations in Canadian currency relative to the US
dollar. Mineral Interests 15 Mineral interest acquisition costs and related interest and
financing costs may be deferred until the property is placed into production,
sold or abandoned. Mineral interest acquisition costs will be deferred only
when, and if, proven and probable reserves have been found to exist. No proven
or probable reserves are currently known to exist. Any deferred costs will be amortized on a unit-of-production
basis over the estimated proven and probable reserves of the property following
commencement of commercial production or written off if the property is sold,
allowed to lapse or abandoned. Earnings (Loss) per Common Share Income Taxes Foreign Currency Translation Fair Value of Financial Instruments Use of Estimates in the Preparation of Financial
Statements 16 Recent Accounting Pronouncements In February 2010, the FASB issued ASU No. 2010-09
Subsequent Events (ASC Topic 855) Amendments to Certain Recognition and
Disclosure Requirements (ASU No. 2010-09) which requires an entity that
is an SEC filer to evaluate subsequent events through the date that the
financial statements are issued and removes the requirement for an SEC filer to
disclose a date, in both issued and revised financial statements, through which
the filer had evaluated subsequent events. The adoption did not have an impact
on the Companys financial position and results of operations. See note 8 of the
financial statements for events occurring subsequent to May 31, 2010. In January 2010, FASB issued Accounting Standards Update
(ASU) No. 2010-06, Improving Disclosures about Fair Value
Measurements which amends FASB Accounting Standards Codification (ASC)
820 and clarifies and provides additional disclosure requirements related to
recurring and non-recurring fair value measurements and employers disclosures
about postretirement benefit plan assets. This ASU is effective for interim and
annual reporting periods beginning after December 15, 2009. The adoption of ASU
2010-06 did not have a material impact on the Companys financial
statements. In August 2009, the FASB issued an amendment to the accounting
standards related to the measurement of liabilities that are recognized or
disclosed at fair value on a recurring basis. This standard clarifies how a
company should measure the fair value of liabilities and that restrictions
preventing the transfer of a liability should not be considered as a factor in
the measurement of liabilities within the scope of this standard. This standard
was effective on October 1, 2009. The adoption of this topic did not have a
material impact on the Company's consolidated results of operations or financial
condition. In June 2009, ASC Topic Amendments to FASB interpretation
No. 46(R) which modifies how a company determines when an entity that is
insufficiently capitalized or is not controlled through voting (or similar
rights) should be consolidated was issued. This topic clarifies that the
determination of whether a company is required to consolidate an entity is based
on, among other things, the entity's purpose and design and a company's ability
to direct the activities of the entity that most significantly impact the
entity's economic performance. This topic requires an ongoing reassessment of
whether a company is the primary beneficiary of a variable interest entity and
also requires additional disclosures about a company's involvement in variable
interest entities and any significant changes in risk exposure due to that
involvement. The topic was effective for fiscal years beginning after November
15, 2009. The adoption of this standard did not have a material impact on our
consolidated results of operations or financial condition. Effective June 30, 2009, we adopted a new accounting standard
related to the disclosure requirements of the fair value of the financial
instruments. This standard expands the disclosure requirements of fair value
(including the methods and significant assumptions used to estimate fair value)
of certain financial instruments to interim period financial statements that
were previously only required to be disclosed in financial statements for annual
periods. In accordance with this standard, the disclosure requirements have been
applied on a prospective basis and did not have a material impact on our
financial statements. In December 2007, ASC Topic Business Combinations was
issued. The objective of this statement significantly changes the
accounting for business combinations. An acquiring entity will be required to
recognize all the assets acquired and liabilities assumed in a transaction at
the acquisition date fair value with limited exceptions. This topic applies
prospectively to business combinations for which the acquisition date is on or
after the beginning of the first annual reporting period beginning on or after
December 15, 2009. The adoption did not have an impact on our financial
statements. ITEM
7A. QUANTITATIVE and
QUALITATIVE DISCLOSURES ABOUT MARKET RISKS As a smaller reporting company, we are not required to
provide the information required by this Item. 17 ITEM
8. FINANCIAL
STATEMENTS and SUPPLEMENTARY DATA Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of We have audited the balance sheet of Theron Resource Group
(an exploration stage company) as of May 31, 2010 and the related statements of
operations, changes in stockholders equity and cash flows for the years ended
May 31, 2010 and 2009 and for the period April 11, 2006 (date of inception)
through May 31, 2010. Theron Resource Groups management is responsible for
these financial statements. Our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits in accordance with the standards of
the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audits 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 the
Company's internal control over its financial reporting. Our audits 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 includes examining on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above
present fairly, in all material respects the financial position of the Company
as of May 31, 2010 and the results of its operations, cash flows and changes in
stockholders equity for the years ended May 31, 2010 and 2009 and for the
period April 11, 2006 (date of inception) through May 31, 2010 in conformity
with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in Note
2 to the financial statements, conditions exist which raise substantial doubt
about the Companys ability to continue as a going concern unless it is able to
generate sufficient cash flows to meet its obligations and sustain its
operations. Managements plan in regard to these matters are also described in
Note 2. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty. Gruber & Company, LLC Lake Saint Louis, Missouri 18 Theron Resource Group See accompanying notes to financial statements 19 Theron Resource Group See accompanying notes to financial statements 20 Theron Resource Group See accompanying notes to financial statements 21 Theron Resource Group See accompanying notes to financial statements 22 THERON RESOURCE GROUP Note 1 Nature of Operations Theron Resource Group (the Company or Theron) was
incorporated under the laws of the State of Wyoming on April 11, 2006. The
Company is a start-up, exploration stage corporation which has an option
agreement to acquire through a two-phase exploration program, a property in
south-western British Columbia, Canada, consisting of six claim blocks covering
4,380 acres. The Companys business plan is to proceed with initial exploration
of the claims to determine if there are commercially exploitable deposits of
gold. If gold exists on the claims the Company will determine if it can be
economically extracted and profitably processed. The Company is an exploration stage company and is subject to
compliance with ASC (Accounting Standards Codification) Topic Accounting and
Reporting by Development Stage Companies. The Company is devoting its
resources to establishing the new business but its planned operations have not
yet commenced: accordingly, no revenues have been earned during the period from
April 11, 2006 (date of inception), to May 31, 2010. Note 2 Basis of Presentation and Going Concern
The Companys accounting and reporting policies conform to
accounting principles generally accepted in the United States of America
applicable to exploration stage enterprises. The functional currency is the
United States dollar, and the financial statements are presented in United
States dollars. The Companys financial statements at May 31, 2010, and for the
year then ended have been prepared on a going concern basis, which contemplates
the realization of assets and settlement of liabilities and commitments in the
normal course of business. The Company incurred a loss of $16,555 for the year
ended May 31, 2010, and $85,328 for the period from April 11, 2006 (date of
inception), through May 31, 2010. We have not generated any revenues and no
revenues are anticipated until we begin removing and selling gold; there is no
assurance that a commercially viable deposit exists on the mineral claims that
we have under option. These conditions raise substantial doubt as to the
Companys ability to continue as a going concern. Managements plans to support the Company in operation and to
maintain its business strategy is to raise funds through public offerings and to
rely on officers and directors to perform essential functions with minimal
compensation. If the Company does not raise all of the money it needs from the
public offering it will have to find alternative sources, such as a second
public offering, a private placement of securities, or loans from its officers,
directors or others. If the Company requires additional cash and cant raise it,
it will either have to suspend operations until the cash is raised, or cease
business entirely. The accompanying financial statements do not include any
adjustments related to the recoverability and classification of assets or the
amounts and classifications of liabilities that might be necessary should the
Company be unable to continue as a going concern. Note 3 Summary of Significant Accounting Policies
Cash and cash equivalents For purposes of the statement of cash flows, the Company
considers all highly liquid investments purchased with an original maturity of
three months or less to be cash equivalents. Mining exploration costs The Company is primarily engaged in the acquisition,
exploration and development of mineral properties. Mineral property acquisitions are initially capitalized as
tangible assets when purchased in accordance with FASB ASC 805-20-55-37. At the
end of each fiscal quarter, the Company assesses the carrying costs for
impairment. If proven and probable reserves are established for a property and
it has been determined that a mineral property can be economically developed,
costs will be amortized using the units-of-production method over the estimated
life of the proven and probable reserves. 23 THERON RESOURCE GROUP Note 3 Summary of Significant Accounting Policies
(continued) Mineral property exploration costs are expensed as
incurred. As of May 31, 2010 the Company has not established any proven
or probable reserves on its mineral properties and has incurred no acquisition
or exploration costs. The beneficial owner holds the right to the claims which give
him or his designated agent the right to mine and recover all of the metals
contained within the surface boundaries of the lease vertically downward. In the
event he were to grant another deed which is subsequently registered prior to
the Companys deed, the third party would obtain good title and the Company
would have nothing. Reclamation costs The Company is subject to the Canadian Mineral Tenure Act
Regulations, the British Columbia Mineral Exploration Code and the Ministry of
Energy and Mines of British Columbia. Before commencing the exploration program
a permit must be obtained from the District Inspector, a provincial government
agent. Further, the Company is required to reclaim the mining claim after the
exploration program is completed including removing any garbage, fuel drums,
cleaning any spills, and filling in any open trenches. The Health, Safety and Reclamation Code for mines in British
Columbia deals with environmental matters relating to the exploration of mining
properties. The Codes goals are to protect the environment through a series of
regulations affecting health, safety, archaeological sites and exploration
access. The Company is responsible to provide a safe working environment, not
disrupt archaeological sites, and to conduct its activities to prevent
unnecessary damage to the property. Upon abandonment of the property, all holes,
pits and shafts will be filled in or sealed. It is difficult to estimate the
full costs of the compliance with the environmental law since the full nature
and extent of our proposed activities cannot be determined until the Company
starts operations. The Company will record a liability for the estimated costs
to reclaim the mined land by recording charges to production costs for each unit
of gold mined over the life of the mine. The amount to be charged will be based
on managements estimate of reclamation costs to be incurred. The accrued
liability will be reduced as reclamation expenditures are made. Certain
reclamation work will be performed concurrently with mining and these
expenditures are charged to operations as incurred. Use of estimates In preparing financial statements, management makes estimates
and assumptions that affect the reported amounts of assets and liabilities in
the balance sheet and revenues and expenses in the statement of operations.
Actual results could differ from those estimates. Fair value of financial instruments and derivative financial
instruments SFAS No. 107 disclosures about fair value of financial
instruments define the fair value of a financial instrument as the amount at
which the instrument could be exchanged in a current transaction between willing
parties. The carrying amounts of cash and current liabilities approximate fair
value due to the short maturity of these items. These fair value estimates are subjective in nature and involve
uncertainties and matters of significant judgment, and, therefore, cannot be
determined with precision. Changes in assumptions could significantly affect
these estimates. The Company does not hold or issue financial instruments for
trading purposes, nor does it utilize derivative instruments in the management
of foreign exchange, commodity price, or interest rate market risks. 24 THERON RESOURCE GROUP Note 3 Summary of Significant Accounting Policies
(continued) Income taxes The Company adopted ASC Topic Accounting for Income Taxes
as of inception. We recognize deferred tax assets and liabilities based on
differences between the financial reporting and tax bases of assets and
liabilities using the enacted tax rates and laws that are expected to be in
effect when the differences are expected to be recovered. The Company provides a
valuation allowance for deferred tax assets for which it does not consider
realization of such assets to be more likely than not. The Corporation currently has no issues that create timing
differences that would mandate deferred tax expense. Net operating losses would
create possible tax assets in future years. Due to the uncertainty as to the
utilization of net operating loss carry forwards, a valuation allowance has been
made to the extent of any tax benefit that net operating losses may generate.
No provision for income taxes has been recorded due to the net
operating loss carry forwards totalling approximately $85,328 as of May 31,
2010, that will be offset against future taxable income. The available net
operating loss carry forwards expire in various years through 2030. No tax
benefit has been reported in the financial statements because the Corporation
believes there is a 50% or greater chance the carry forwards will expire unused.
Basic and diluted net loss per share The Company computes net income (loss) per share in accordance
with ASC Topic Earnings per Share. The basic net loss per common share
is computed by dividing the net loss by the weighted average number of common
shares outstanding. Diluted net loss per share gives effect to all dilutive
potential common shares outstanding during the period using the as if
converted basis. For the year ended May 31, 2010, and for the period April 11,
2006 (date of inception), through May 31, 2010, there were no potential dilutive
securities. Concentration of Credit Risk Financial instruments, which potentially subject the Company to
concentrations of credit risk, consist of cash and cash equivalents. The Company
places its cash with high quality financial institutions and at times may exceed
the FDIC $250,000 insurance limit Special purpose entities The Company does not have any off-balance sheet financing
activities. Impairment or Disposal of Long-Lived Assets In August 2001, ASC Topic Accounting for the Impairment or
Disposal of Long-Lived Assets was issued which clarifies the accounting for the
impairment of long-lived assets and for long-lived assets to be disposed of,
including the disposal of business segments and major lines of business.
Long-lived assets are reviewed when facts and circumstances indicate that the
carrying value of the asset may not be recoverable. When necessary, impaired
assets are written down to their estimated fair value based on the best
information available. Stock Based Compensation The Company accounts for its stock-based compensation in
accordance with ASC Topic Share-Based Payment and recognizes in the
statement of operations the grant-date fair value of stock options and other
equity-based compensation issued to employees and non-employees. The Company did
not grant any new employee options and no options were cancelled or exercised during the year ended
May 31, 2010. As of May 31, 2010, there were no options outstanding. 25 THERON RESOURCE GROUP Note 3 Summary of Significant Accounting Policies
(continued) Business segments ASC Topic Disclosures About Segments of an Enterprise and
Related Information establishes standards for the way that public companies
report information about operating segments in annual financial statements and
requires reporting of selected information about operating segments in interim
financial statements issued to the public. It also establishes standards for
disclosures regarding products and services, geographic areas and major
customers. The Company has evaluated the requirements of this Topic and
determined that it is not applicable to our operations. Start-up expenses Theron adopted ASC Topic Reporting the Costs of Start-up
Activities, which requires that costs associated with start-up activities
be expensed as incurred. Accordingly, start-up costs associated with the
Companys formation have been included in the Companys general and
administrative expenses for the period from April 11, 2006 (date of inception),
through May 31, 2010. Foreign currency translation The Companys functional and reporting currency is the United
States dollar. The financial statements of the Company are translated to United
States dollars in accordance with ASC Topic Foreign Currency
Translation. Monetary assets and liabilities denominated in foreign
currencies are translated using the exchange rate prevailing at the balance
sheet date. Gains and losses arising on translation or settlement of foreign
currency denominated transactions or balances are included in the determination
of income. The translation was not material to accumulate in the current fiscal
year. Recently issued accounting pronouncements In February 2010, the FASB issued Accounting Standards Update
(ASU) No. 2010-09, which amends the Subsequent Events Topic of the Accounting
Standards Codification (ASC) to eliminate the requirement for public companies
to disclose the date through which subsequent events have been evaluated. The
Company will continue to evaluate subsequent events through the date of the
issuance of the financial statements, however, consistent with the guidance,
this date will no longer be disclosed. The Company does not expect the adoption
of this guidance to have a material impact on the Companys consolidated
financial statements, financial condition or liquidity. In January 2010, the FASB issued ASU No. 2010-06, Fair Value
Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value
Measurements. ASU No. 2010-06 amends ASC 820 and clarifies and provides
additional disclosure requirements on the transfers of assets and liabilities
between Level 1 (quoted prices in active market for identical assets or
liabilities) and Level 2 (significant other observable inputs) of the fair value
measurement hierarchy, including the reasons for and the timing of the
transfers. Additionally, the guidance requires a roll forward of activities on
purchases, sales, issuance, and settlements of the assets and liabilities
measured using significant unobservable inputs (Level 3 fair value
measurements). Other than requiring additional disclosures, adoption of this new
guidance will not have a material impact on our financial statements. In June 2009, ASC Topic The FASB Accounting Standards
Codification(TM) and the Hierarchy of Generally Accepted Accounting Principles
A Replacement of FASB Statement No. 162 was issued. This standard
establishes the FASB Accounting Standards Codification(TM) (the "Codification")
as the source of authoritative accounting principles recognized by the FASB to
be applied by nongovernmental entities in the preparation of financial
statements in conformity with US GAAP. The Codification does not change current
US GAAP, but is intended to simplify user access to all authoritative US GAAP by providing
all the authoritative literature related to a particular topic in one place. The
Codification is effective for interim and annual periods ending after September
15, 2009, and as of the effective date, all existing accounting standard
documents were superseded. The Codification was effective in the second quarter
of the year ending May 31, 2009, and accordingly, all subsequent public filings
reference the Codification as the sole source of authoritative literature. 26 THERON RESOURCE GROUP Note 3 Summary of Significant Accounting Policies
(continued) In June 2009, ASC Topic, Accounting for Transfers of
Financial Assets an Amendment of FASB Statement No. 140 was issued. It
requires entities to provide more information regarding sales of securitized
financial assets and similar transactions, particularly if the entity has
continuing exposure to the risks related to transferred financial assets. The
topic eliminates the concept of a qualifying special-purpose entity, changes
the requirements for derecognizing financial assets and requires additional
disclosures. The topic was effective for fiscal years beginning after November
15, 2009. The Company has determined that the impact SFAS 166 will have no
effect on its financial condition, results of operations or cash flows. In June 2009, ASC Topic, Amendments to FASB interpretation
No. 46(R) which modifies how a company determines when an entity that is
insufficiently capitalized or is not controlled through voting (or similar
rights) should be consolidated was issued. This topic clarifies that the
determination of whether a company is required to consolidate an entity is based
on, among other things, the entity's purpose and design and a company's ability
to direct the activities of the entity that most significantly impact the
entity's economic performance. This topic requires an ongoing reassessment of
whether a company is the primary beneficiary of a variable interest entity and
also requires additional disclosures about a company's involvement in variable
interest entities and any significant changes in risk exposure due to that
involvement. The topic was effective for fiscal years beginning after November
15, 2009. The Company has determined that the impact will have no effect on its
financial condition, results of operations or cash flows. Effective June 30, 2009, we adopted a new accounting standard
related to the disclosure requirements of the fair value of the financial
instruments. This standard expands the disclosure requirements of fair value
(including the methods and significant assumptions used to estimate fair value)
of certain financial instruments to interim period financial statements that
were previously only required to be disclosed in financial statements for annual
periods. In accordance with this standard, the disclosure requirements have been
applied on a prospective basis and did not have a material impact on our
financial statements. In May 2009, ASC Topic Subsequent Events was issued.
It provides guidance to establish general standards of accounting for and
disclosures of events that occur after the balance sheet date but before
financial statements are issued or are available to be issued. The topic also
requires entities to disclose the date through which subsequent events were
evaluated as well as the rationale for why that date was selected. The topic is
effective for interim and annual periods ending after June 15, 2009. SFAS 165
requires that public entities evaluate subsequent events through the date that
the financial statements are issued. In February, 2010 this topic was amended to
exclude public companies from disclosing the date through which subsequent
events were reviewed.. In April 2009, ASC Topic Determining Fair Values When the
Volume and Level of Activity for the Asset or Liability Have Significantly
Decreased and Identifying Transactions That Are Not Orderly was issued
.This topic provides guidance on (1) estimating the fair value of an asset
or liability when the volume and level of activity for the asset or liability
have significantly declined and (2) identifying transactions that are not
orderly. This topic was effective beginning April 1, 2009. The adoption of this
topic did not have a material impact on the Company's consolidated results of
operations or financial condition. 27 THERON RESOURCE GROUP Note 3 Summary of Significant Accounting Policies
(continued) In April 2009, ASC Topic Recognition and Presentation of
Other-Than-Temporary Impairments was issued. This topic modifies the
requirements for recognizing other-than-temporarily impaired debt securities and
changes the existing impairment model for such securities. The topic also
requires additional disclosures for both annual and interim periods with respect to both debt and equity
securities. Under the topic, impairment of debt securities will be considered
other-than-temporary if an entity (1) intends to sell the security, (2) more
likely than not will be required to sell the security before recovering its
cost, or (3) does not expect to recover the security's entire amortized cost
basis (even if the entity does not intend to sell). The topic further indicates
that, depending on which of the above factor(s) causes the impairment to be
considered other-than-temporary, (1) the entire shortfall of the security's fair
value versus its amortized cost basis or (2) only the credit loss portion would
be recognized in earnings while the remaining shortfall (if any) would be
recorded in other comprehensive income. The topic requires entities to initially
apply the provisions of the standard to previously other-than-temporarily
impaired debt securities existing as of the date of initial adoption by making a
cumulative-effect adjustment to the opening balance of retained earnings in the
period of adoption. The cumulative-effect adjustment potentially reclassifies
the noncredit portion of a previously other-than-temporarily impaired debt
security held as of the date of initial adoption from retained earnings to
accumulated other comprehensive income. This pronouncement was effective April
1, 2009. The adoption of this standard did not have a material impact on our
consolidated results of operations or financial condition. In April 2009, ASC Topic, Interim Disclosures about Fair
Value of Financial Instruments was issued. This topic essentially
expands the disclosure about fair value of financial instruments that were
previously required only annually to also be required for interim period
reporting. In addition, the topic requires certain additional disclosures
regarding the methods and significant assumptions used to estimate the fair
value of financial instruments. In March 2008, ASC Topic Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement No. 133,
was issued which requires additional disclosures about the objectives of the
derivative instruments and hedging activities, the method of accounting for such
instruments under this topic and its related interpretations, and a tabular
disclosure of the effects of such instruments and related hedged items on our
financial position, financial performance, and cash flows. The Company does not
expect the adoption of this topic to have a material impact on the consolidated
financial statements. In December 2007, ASC Topic Business Combinations was
issued. The objective of this statement significantly changes the
accounting for business combinations. An acquiring entity will be required to
recognize all the assets acquired and liabilities assumed in a transaction at
the acquisition date fair value with limited exceptions. This topic applies
prospectively to business combinations for which the acquisition date is on or
after the beginning of the first annual reporting period beginning on or after
December 15, 2009. The Company does not expect the adoption of this topic to
have a material impact on the consolidated financial statements. In December 2007, ASC Topic Non-controlling Interests in
Consolidated Financial Statements-An Amendment of ARB No. 51 was issued.
The objective of this topic is to establish new accounting and reporting
standards for the non-controlling interest in a subsidiary and for the
deconsolidation of a subsidiary. It is effective for fiscal years, and interim
periods within those fiscal years, beginning on or after December 15, 2009. We
do not expect the adoption of this topic to have a material impact on our
consolidated financial statements. Note 4 Common stock transactions Activity for the period April 11, 2006 (date of inception), to
May 31, 2006 On April 20, 2006, we issued 6,000,000 shares of common stock at a price of
$0.001 per share to our founder for $6,000 in cash. Activity for the period June 1, 2006, to May 31,
2007 On November 30, 2006, we issued 900,000 shares at a price of $0.01 per share for
cash of $9,000. Activity for the period June 1, 2007, to May 31, 2008 28 THERON RESOURCE GROUP Note 4 Common stock transactions (continued)
As a result, we made a rescission
offering to the subscribers and the selling shareholders to refund their monies
with interest if so requested under an S-1 Rescission Offering registration
statement. These shares of common stock were subject to rescission by the
shareholder because of our failure to comply with securities laws. Rescission
rights for individual stockholders vary, based upon the laws of the states in
which the stockholders reside. Common stock that is subject to rescission is
recorded separately from stockholders' deficiency in a company's balance sheet.
As the statute of limitations expire in the respective states, such amounts are
reclassified to stockholders' deficiency. The S-1 was effective on April 13,
2009. Accounting Series Release (ASR) No.
268 and Emerging Issues Task Force (EITF) Topic D-98 require that stock
subject to rescission or redemption requirements outside the control of an
entity to be classified outside of permanent equity. The exercise of the
rescission right is at the holders discretion, but exercise of that right may
depend in part on the fair value of the entitys common stock, which is outside
of the entitys and the holders control. As a result, common stock subject to
rescission was classified as temporary equity. Activity for the period June 1, 2008, to May 31, 2009 Received $8,500 from the common stock subscriptions receivable at March 31,
2008. Activity for the period June 1, 2009, to May 31,
2010 No shares were issued during the period. Note 5 Common Stock Subject to Rescission During April and May, 2008, the Company received $41,500 and
had a subscription receivable in the amount of $8,500 for 1,000,000 common
shares at a price of $0.05 per share subscribed for under the Companys SB-2. In
addition, between December 2007, and May 2008, the selling shareholders as
indicated in the SB-2 offering sold 900,000 shares to a total of three new
shareholders. All of the 1,900,000 shares issued or resold were sold prior to
the declaration of an effective date for the Companys SB-2 registration
statement filed on October 05, 2007, under our mistaken assumption that the
registration statement had become effective through the passage of time. All of
the subscribers have been informed of this situation. On April 3, 2009, under an S-1 rescission offering registration
statement we offered to rescind a total of 1,900,000 shares of common stock
issued or sold by the selling shareholders under its October, 2007, SB-2
registration statement. These shares represented all of the SB-2 shares issued
(1,000,000) and the shares (900,000) sold by the selling shareholders for which
a purchaser could claim a rescission right. The rescission offer was intended to
address the Companys rescission liability relating to its federal and state
securities laws compliance issues by allowing the holders of the shares covered
by the rescission offer to rescind the underlying securities transactions and
sell those securities back to the Company or recover damages, as the case may
be. The rescission statement became effective on April 13, 2009, and closed on
May 14, 2009, with no shareholder accepting the offering, i.e., tendering their
shares for repurchase. As of the date of this report, Theron has 7,900,000
shares of common stock issued and outstanding. 29 THERON RESOURCE GROUP Note 6 Related party transactions Officers contributed administrative services to the Company for
most periods to May 31, 2008. The time and effort was recorded in the
accompanying financial statements based on the prevailing rates for such
efforts, which equaled $50 per hour based on the level of services performed.
The services are reported as contributed administrative support with a
corresponding entry to additional paid-in capital. In April, 2006 we issued a total of 6,000,000 shares of
restricted common stock to our director for $6,000 ($0.001 per share) as founder
shares. (Note 4). As of May 31, 2010, the amount due to a related party consists
of an $18,000 advance from our officer and director which was provided for
working capital purposes. The balance is non-interest bearing, unsecured and has
no fixed terms of repayment. Note 7 Commitments Under the terms of the Option to Purchase and Royalty
Agreement, Theron must incur exploration expenditures on the George claims in
the minimum amount of $20,000 by August 31, 2008, (paid; an analysis of the work
and engineering report are pending) and an additional $40,000 by February 28,
2010, which has not been carried out to date due to the late receipt of an
engineering report. In the event that the results of the development phases are
unfavorable, the Company will terminate the option and will not be obligated to
make any subsequent payments. We have recently (July 15, 2010) received an
engineering report on the first phase project and must spend some time reviewing
it and its implications before determining future actions. The Vendor has
verbally agreed not to terminate the option agreement until at least 180 days
after the receipt of the engineering report on the phase I exploration work
carried out in mid 2009. Upon exercise of the option, we are required to pay the owner,
commencing May 31, 2010, sum of $25,000 per annum, as prepayment of the net
smelter royalty. The Vendor has verbally agreed to delay the requirement to pay
the net smelter amount until at least one year after the receipt of the
engineering report noted above. Note 8 Income Taxes Theron has losses carried forward for income tax purposes.
There are no current or deferred income tax expenses for the period April 11,
2006, through May 31, 2010, due to our loss position and we have fully reserved
for any benefits of these losses. Realization of the future tax benefits
related to the deferred tax assets is dependent on the Companys ability to
generate taxable income within the net operating loss carry-forward period. Note 9 Subsequent Events There are no subsequent events reportable as of the date of the
annual financial statements or the date of this report.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
For the fiscal year ended MAY 31,
2010
For the transition period from
_____________ to _____________
THERON RESOURCE GROUP
(Exact name of small business issuer in its
charter)
Wyoming
26-0665325
(State or jurisdiction of incorporation or
organization)
(I.R.S. Employer Identification No.)
1596 Gulf Road, Number 34
Point
Roberts, Washington
98281
(Address of principal executive offices)
(Zip Code)
Issuers telephone number: (888) 755-9766
Issuers email address: theronresourcegroup@gmail.com
Securities Registered Under Section 12(b) of the
Exchange Act: None
Securities Registered Under Section 12(g) of the
Exchange Act:
Common Stock, $0.001 par value
(Title of class)
Large accelerated filer [ ]
Accelerated filer [
]
Non-accelerated filer [ ]
Smaller reporting company [X]
•
Form 10-K for the fiscal year ended May 31,
2009 and dated September 9, 2009, including audited financial statements
to May 31, 2009;
•
Option To Purchase And Royalty Agreement
between Theron Resource Group and Bryan Livgard (incorporated by reference
from our registration statement on Form SB-2 filed on October 04, 2007)
Development
Preparation of a mineral deposit for commercial
production, including installation of plant and machinery and the
construction of all related facilities. Development of a mineral deposit
can only be made after a commercially viable mineral deposit, a
reserve, has been evaluated as economically and legally feasible.
Diamond drill
A type of rotary drill in which the cutting is
done by abrasion rather than percussion. The cutting bit is set with
diamonds and is attached to the end of long hollow rods through which
water is pumped to the cutting face. The drill cuts a core of rock, which
is recovered in long cylindrical sections an inch or more in diameter.
Exploration
Prospecting, trenching, mapping, sampling,
geochemistry, geophysics, diamond drilling and other work involved in
searching for mineral bodies.
Geochemistry
Broadly defined as all parts of geology that
involve chemical changes or narrowly defined as the distribution of the
elements in the earths crust; the distribution and migration of the
individual elements in the various parts of the earth.
Geology
The science that deals with the history of the
earth and its life especially as recorded in the rocks; a chronological
account of the events in the earths history.
Geophysics
The science of the earth with respect to
its structure, components and development.
Mineral
A naturally occurring inorganic element or
compound having an orderly internal structure & characteristic
chemical composition, crystal form & physical properties.
Mineralization
Rock containing an undetermined amount
of minerals or metals.
4
PART I
Item
1. Description
of Business.
Overview
•
our ability to find a profitable
exploration property;
•
our ability to generate revenues; and
•
our ability to reduce exploration costs.
•
Costs of bringing the property
into production including exploration work, preparation of production
feasibility studies and construction of production facilities;
•
Availability and costs of
financing;
•
Ongoing costs of
production;
•
Market prices for the
products to be produced;
•
Environmental compliance
regulations and restraints; and
•
Political climate and/or
governmental regulation and control.
•
received and approved the financial statements
of the Corporation for its financial year ended May 31, 2009, together
with the report of the independent auditors thereon;
•
fixed the number of directors at one for
the coming year;
•
elected a director, Jerry R. Satchwell, to
serve until the next annual general meeting of shareholders or until his
successor(s) is/are elected or appointed;
•
ratified the appointment of Gruber &
Associates, L.L.C., as independent auditors of the Corporation for the
financial year ended May 31, 2010.
Month
Ended
High Bid
Low Bid
February 28, 2010
$1.00
$0.90
May 31,
2010
$0.91
$0.91
a)
Theron, or its permitted assigns, contributing exploration
expenditures on the property of a minimum of US $20,000 on or before May
31, 2009 (which sum was paid; an engineering report was received in late
May, 2010 which recommended a phase II exploration program at a projected
cost of $155,000);
b)
Theron, or its permitted assigns, contributing exploration
expenditures on the property of a further US $40,000 for aggregate minimum
contributed exploration expenses of US $60,000 on or before May 31, 2010;
The option agreement expired on May 31, 2010, but the property owner has
verbally agreed to take no action to terminate the agreement until such
time as we have been able to review the engineering report of the first
phase of the exploration program and are in a position to determine how
and when we will be able to move forward with the project; we expect to be
in a position to make such determination prior to the end of the current
calendar year;
c)
Upon exercise of the option agreement, Theron will pay to Livgard US
$25,000 per annum as pre- payment of the net smelter return, effective May
31, 2011; and
d)
Theron will pay to Livgard an annual royalty equal to three percent
(3%) of NSR; and
1.
The sample results of the bark survey, location maps and forest cover
report should be submitted to Colin Dunn, Biogeochemistry Consultant, for
evaluation and further work contingent upon his recommendations.
2.
The property exploration has now been narrowed down to 2-3 areas each
not more than about 1/10 of a square kilometer.
3.
An excavator should be brought in and used to construct an access road
to the anomalous areas.
4.
Bedrock should be exposed by trenching and diamond drill sites should
be constructed
5.
It is recommended that the anomalous halogen response areas and
trenches be geologically mapped in detail.
6.
It is recommended that six diamond drill holes in at least 3 locations
be drilled to an average depth of 125 meters for a total of 750 meters.
The core must be described and zones of interest must be split, sampled
and analyzed and stored at a safe place.
Consultant
$
3,500
Geologist
and assistant
$
28,000
Accommodation & meals & travel
$
10,400
Excavator
$
18,000
Diamond drilling 750 meters
$
90,000
Assaying of
split core
$
6,000
Report and maps
$
5,000
Sub-total
$
140,900
Contingency 10%
$
14,100
Total
$
155,000
Results of Operations
Year Ended May 31
2010
2009
Revenue
$
0
$
0
Operating Expenses
16,555
35,834
Net Profit (Loss)
$
(16,555
)
$
(35,834
)
Year Ended May 31
2010
2009
Mineral property exploration
$
0
$
20,082
Gain on foreign exchange
4
0
Professional fees
6,945
5,942
Communications expenses
559
1,290
Office expenses
537
1,425
Travel and entertainment
1,473
2,460
Filing fees
2,303
4,635
Transfer agent services
4,725
0
Contributed services
0
0
TOTAL
$
16,555
$
35,834
Working Capital
At May 31, 2010
At May 31, 2009
Current Assets
$
2,000
$
405
Current Liabilities
22,500
4,350
Working Capital
$
(20,500
)
$
(3,945
)
Cash Flows
At May 31, 2010
At May 31, 2009
Net Cash Used in Operating Activities
$
(15,405
)
$
(38,789
)
Net Cash Provided
by (Used In) Investing Activities
Nil
Nil
Net Cash Provided by Financing Activities
17,000
(3,500
)
Increase
(Decrease) In Cash During The Period
$
1,595
$
(42,289
)
Acquisition of mineral property
interest
$
4,242
Mineral property exploration
20,082
Loss on foreign exchange
93
Professional fees
31,680
Communications
3,805
Office expenses
5,440
Travel and entertainment expenses
6,574
Transfer agent
4,725
Filing fees
8,637
Total
Use of Proceeds to May 31, 2010
$
85,278
Operating expenses
$
50,000
Phase II exploration program
155,000
Working Capital
45,000
Total
$
200,000
The Companys functional currency
is the United States dollar. Dollar costs of Therons property acquisition and
planned exploration costs are in Canadian Dollars (CDN). For purposes of
consistency and to express United States Dollars throughout this report,
Canadian currency has been converted into United States currency at the rate of
US $1.00 being approximately equal to CAD 1.00 which is the approximate average
exchange rate during recent months and which is consistent with the incorporated
financial statements.
The Company considers all
highly liquid securities with original maturities of three months or less when
acquired to be cash equivalents. There were no cash equivalents at May 31,
2010.
At May 31, 2010, the fair
value of the Companys financial instruments approximate their carrying value
based on their terms and interest rates.
Mineral interest acquisition costs
include cash consideration and the estimated fair value of common shares issued
for mineral properties, based on recent share issuances. Exploration and
development expenditures are expensed in the period incurred until such time as
the Company establishes the existence of commercial feasibility, at which time these costs will be deferred.
Administrative expenditures are expensed in the period incurred.
The Company computes
net income (loss) per share in accordance with ASC Topic Earnings per
Share. The basic net loss per common share is computed by dividing the net
loss by the weighted average number of common shares outstanding; basic loss per
share excludes the impact of common stock equivalents. Diluted net loss per
share gives effect to all dilutive potential common shares outstanding during
the period using the as if converted basis, i.e., it utilizes the average
market price per share when applying the treasury stock method in determining
common stock equivalents. For the year ended May 31, 2010, and for the period
April 11, 2006 (date of inception), through May 31, 2010, there were no
variances between the basic and diluted loss per share as there were no
potential dilutive securities.
The Company adopted ASC Topic,
Accounting for Income Taxes on inception. The Company recognizes
deferred tax assets and liabilities based on differences between the financial
reporting and tax bases of assets and liabilities using the enacted tax rates
and laws that are expected to be in effect when the differences are expected to
be recovered. Under this method, deferred tax liabilities and assets are
determined based on the difference between the financial statement and tax bases
of assets and liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse. The Company provides a valuation
allowance for deferred tax assets for which it does not consider realization of
such assets to be more likely than not.
The Companys functional
and reporting currency is the United States dollar and where necessary the
accounts of the Companys foreign operations have been translated into United
States dollars in accordance with ASC Topic Foreign Currency
Translation. Assets and liabilities of those operations are translated in
U.S. dollars using exchange rates as of the balance sheet date; income and
expenses are translated using the average exchange rates for the reporting
period. Translation adjustments are deferred in accumulated other comprehensive
income (loss), a separate component of shareholders deficit.
ASC Topic
disclosures about fair value of financial instruments define the fair value of a
financial instrument as the amount at which the instrument could be exchanged in
a current transaction between willing parties. The carrying values of the
Company's financial instruments, which include cash, accounts receivable, and
accrued expenses, approximate fair values due to the short-term maturities of
such instruments.
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from those estimates and assumptions.
Theron Resource Group
August 31, 2010
(an Exploration Stage Company)
Balance Sheets May 31, 2010
Assets
Current assets
Cash and cash equivalents
$
2,000
Total Assets
2,000
Liabilities and Stockholders' Deficit
Current liabilities
Accounts
payable and liabilities
4,500
Due to related party
18,000
Total liabilities
22,500
Common Stock subject to rescission
(Note 5)
Stockholders' deficit
Common stock, 500,000,000
shares authorized, par value $0.001
7,900,000 shares issued and outstanding
7,900
Additional paid-in
capital
57,150
Other
comprehensive loss
-222
Deficit accumulated
during the exploration stage
-85,328
Total stockholders' deficit
-20,500
Total liabilities and stockholders' deficit
$
2,000
(an Exploration Stage Company)
Statements of Operations
For the period
April 11, 2006
For the
For the
(date of inception)
year ended
year ended
through
May 31, 2010
May 31, 2009
May 31, 2010
Revenues
$
$
$
Expenses
Acquisition of mineral property
interest
4,242
Mineral property
exploration
20,082
20,082
Gain on Foreign Exchange
4
93
Professional fees
6,954
5,942
31,680
Communications expense
559
1,290
3,805
Office expenses
537
1,425
5,440
Travel and entertainment
1,473
2,460
6,574
Filing fees
2,303
4,635
8,637
Transfer Agent
4,725
4,725
Other services
50
Total expenses
16,555
35,834
85,328
Net loss
$
-16,555
$
-35,834
$
-85,328
Basic and diluted loss per common
share
(0.002
)
(0.005
)
Weighted average number of common shares
used in per share calculations
7,900,000
6,932,877
(an Exploration Stage
Company)
Statement of Changes in Stockholders' Equity
Deficit
accumulated
Common
Additional
Other
during the
Total
shares
Common
paid-in
Comprehensive
exploration
stockholders'
outstanding
stock
capital
Loss
stage
equity
Common shares issued for cash
6,000,000
$
6,000
$
$
$
$
6,000
Balance, May 31, 2006
6,000,000
6,000
6,000
Common shares issued for cash
900,000
900
8,100
9,000
Contributed services
50
50
Currency exchange loss
-222
-222
Net loss for the year
-14,774
-14,774
Balance, May 31, 2007
6,900,000
$
6,900
$
8,150
-222
$
-14,774
$
54
Net loss for the year
-18,165
-18,165
Balance, May 31, 2008
6,900,000
$
6,900
$
8,150
-222
$
-32,939
$
-18,111
Common shares issued for cash
1,000,000
1,000
49,000
50,000
Net loss for the year
-35,834
-35,834
Balance, May 31, 2009
7,900,000
7,900
57,150
-222
-68,773
-3,945
Net loss for the year
-16,555
-16,555
Balance, May 31, 2010
7,900,000
$
7,900
$
57,150
-222
$
-85,328
$
-20,500
(an Exploration Stage Company)
Statements of Cash Flows
For the period
April 11, 2006
For the
For the
(date of inception)
year ended
year ended
through
May 31, 2010
May 31, 2009
May 31, 2010
Cash flows used for operating
activities
Net loss
$
-16,555
$
-35,834
$
-85,328
Adjustments to reconcile net loss to net
cash provided by operating activities:
Contributed services
0
0
50
Other comprehensive
loss
0
0
-222
Changes in operating assets and liabilities
(Increase) decrease in
prepaid expenses
0
595
0
Increase (decrease) in accrued expenses
1,150
-3,550
4,500
Cash flows used for operating activities
-15,405
-38,789
-81,000
Cash flows from financing activities
Repayment of
shareholder advances
0
-13,000
0
Advances from shareholders
17,000
1,000
18,000
Proceeds from issuance
of common stock
0
8,500
65,000
Proceeds from issuance of common stock,
subject to rescission
0
0
0
Cash flows from financing activities
17,000
-3,500
83,000
Increase in cash and cash equivalents
1,595
-42,289
2,000
Cash and cash equivalents - Beginning of period
405
42,694
Cash and cash equivalents - End of period
$
2,000
$
405
$
2,000
Supplemental Disclosures regarding cash flows
Interest paid
$
$
$
Income taxes paid
Non-cash financing activities
Paid in capital from
contributed services
50
50
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
During April and May 2008, the Company received $41,500 and had a
subscription receivable in the amount of $8,500 for the issuance of 1,000,000
shares of common stock subscribed for at a price of $0.05 per share pursuant to the Companys
SB-2 registration statement dated October 11, 2007, and three selling
shareholders resold 900,000 shares between December 23, 2007, and May 31, 2008.
All of the 1,900,000 shares so issued or resold were issued or resold prior to
the declaration of an effective date for the Companys SB-2 registration
statement under our mistaken assumption that the registration statement had
become effective through the passage of time.
(A Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
MAY 31, 2010
30
ITEM 9. CHANGES IN and DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure during the two fiscal years and interim periods, including the interim period up through the date the relationship ended.
ITEM 9A(T). CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer (our president) and our principal accounting and financial officer (our chief financial officer and treasurer) to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Our management does not expect that our disclosure controls or our internal controls over financial reporting will prevent all error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, but not absolute, assurance that the objectives of a control system are met. Further, any control system reflects limitations on resources and the benefits of a control system must be considered relative to its costs. These limitations also include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of a control. The design of a control system is also based upon certain assumptions about potential future conditions; over time controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.
As of May 31, 2010, the year end period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our chief financial and chief executive officers concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this annual report. There have been no significant changes in our internal controls over financial reporting that occurred during the fiscal year ended May 31, 2010, that have materially or are reasonably likely to materially affect our internal controls over financial reporting.
Management's Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Our management assessed the effectiveness of our internal control over financial reporting as of May 31, 2010. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework. A material weakness is a deficiency or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the companys annual or interim financial statements will not be prevented or detected on a timely basis. We have identified the following material weaknesses.
1. | As of May 31, 2010, we did not maintain effective controls over the control environment. Specifically, we have not developed and effectively communicated to our employees our accounting policies and procedures. This has resulted in inconsistent practices. Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness. |
31
2. | As of May 31, 2010, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness. |
Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of May 31, 2010, based on the criteria established in Internal Control-Integrated Framework issued by COSO.
This annual report does not include an attestation report of the company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the company's registered public accounting firm pursuant to rules of the SEC that permit the company to provide only management's report in this annual report.
None.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS and CORPORATE GOVERNANCE
The following individuals were serving as the directors and executive officers of our company as of the date of this annual report. All directors of our company hold office until the next annual meeting of our shareholders or until their successor(s) have been elected and qualified. The executive officers of our company are appointed by our board of directors and hold office until their death, resignation or removal from office.
Name | Position Held | Age | Date First Elected |
Chief Executive Officer | |||
Jerry R. Satchwell | Chief Operating Officer | 73 | April 11, 2006 |
Chief Financial Officer | |||
Director |
None of the directors or officers has professional or technical accreditation in the exploration, development or operations of mining or mining related projects. During the past year, our president, Mr. Satchwell, spent approximately 10% of his time (approximately 6 hours per week) on the affairs of Theron. For the coming year, it is anticipated that time commitment and requirement will remain approximately the same.
Business Experience
The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our company, indicating the persons principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.
32
Jerry R. Satchwell, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Director has held his office/position since April 11, 2006, will be spending approximately 6 hours of his time on the affairs of Theron and is expected to hold the office/position until the next annual meeting of our shareholders. Mr. Satchwell is a director who serves as president, secretary, treasurer and chief executive officer and has been, a management and business consultant since 1970 in the areas of mining and petroleum exploration and development. He is in the business of providing financial, management and consulting services, merger and acquisition as well as corporate structuring to development and exploration stage businesses. Prior to that he spent 15 years in corporate finance. He is not a director of any other corporations, public or private.
Involvement in Certain Legal Proceedings
During the past five years, none of our officers, directors, promoters or control persons have had any of the following events occur:
• | a bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; |
• | conviction in a criminal proceeding or being subject to a pending criminal proceeding, excluding traffic violations and other minor offenses; |
• | being subject to any order, judgment or decree, not substantially reversed, suspended or vacated, of any court of competent jurisdiction, permanently enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking business; and/or |
• | being found by a court of competent jurisdiction, in a civil action, the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated. |
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Exchange Act requires our executive officers and directors and persons who own more than 10% of our common stock to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common stock and other equity securities, on Forms 3, 4 and 5 respectively. Executive officers, directors and greater than 10% shareholders are required by the SEC regulations to furnish us with copies of all Section 16(a) reports that they file.
Based solely on our review of the copies of such forms received by us, or written representations from certain reporting persons, we believe that during fiscal year ended May 31, 2010, all filing requirements applicable to our officers, directors and greater than 10% percent beneficial owners were complied with , with the exception of the following:
Name | Number of | Number of Transactions | Failure to File |
Late Reports | Not Reported on a | Required | |
Timely Basis | Forms | ||
Jerry R. Satchwell | 2(1) | 2(1) | 2 |
(1) Jerry R. Satchwell failed to file a Form 3 Initial Statement of Beneficial Ownership of Securities and failed to file a Form 5 Annual Statement of Changes in Beneficial Ownership.
Code of Ethics
Our board of directors on April 22, 2007, adopted a formal written Code of Business Conduct and Ethics and Compliance Program for all officers, directors and senior employees. Our Code of Business Conduct and Ethics Program was filed as an exhibit to our Form SB-2 filed with the SEC on October 4, 2007. A copy will be sent without charge to anyone requesting a copy by contacting us at our principal office by letter or e-mail.
33
Audit Committee and Audit Committee Financial Expert
Our board of directors has determined that it does not have a member of its audit committee that qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and is independent as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act.
We believe that the members of our board of directors are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. We believe that retaining an independent director who would qualify as an audit committee financial expert would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact that we have not generated any material revenues to date. In addition, we currently do not have nominating, compensation or audit committees or committees performing similar functions nor do we have a written nominating, compensation or audit committee charter. Our board of directors does not believe that it is necessary to have such committees because it believes the functions of such committees can be adequately performed by our board of directors.
Web Site
Theron maintains its Web site at theron-resource-group.com and has an e-mail address at theronventures@gmail.com.
ITEM 11. EXECUTIVE COMPENSATION
(a) General
The particulars of the compensation paid to the following persons:
• | our principal executive officer; |
• | each of our two most highly compensated executive officers who were serving as executive officers at the end of the years ended May 31, 2010, 2009 and 2008; and |
• | up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the years ended May 31, 2010, 2009 and 2008. |
who we will collectively refer to as the named executive officers of our company, are set out in the following summary compensation table, except that no disclosure is provided for any named executive officer, other than our principal executive officers, whose total compensation did not exceed $100,000 for the respective fiscal year.
(b) Summary Compensation Table
Fiscal | Options | ||||||||||||||||||||
Name and | Year | Stock | Securities | Awards (Value | |||||||||||||||||
Principal | Ended | Awards | Underlying | of Options) ($) | Total | ||||||||||||||||
Position | May 31 | Salary | Bonus | ($) | Options | (5) | Compensation | ||||||||||||||
Jerry R. Satchwell President & Director | 2010 | $ | 0 | $ | 0 | $ | 0 | Nil | $ | 0 | $ | 0 | |||||||||
Jerry R. Satchwell President & Director | 2009 | $ | 0 | $ | 0 | $ | 0 | Nil | $ | 0 | $ | 0 | |||||||||
Jerry R. Satchwell President & Director | 2008 | $ | 0 | $ | 0 | $ | 0 | Nil | $ | 0 | $ | 0 |
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Further, Mr. Jerry R. Satchwell is deemed to have received $50 in 2006 2007 from Theron for certain administrative services as contributed administrative services with a corresponding credit to additional paid-in capital. No payments were made. Otherwise, Mr. Satchwell, our senior officer and director, has received no compensation for his time or services rendered to Theron and there are no plans to compensate him in the near future, unless and until we begin to realize revenues and become profitable in our business. The fair market value of the 6,000,000 shares of Theron issued to Mr. Satchwell in October, 2006 for cash consideration of $6,000 did not exceed the $0.001 per share that he paid for the shares.
(c) Options Grants During the Last Fiscal Year / Stock Option Plans
We do not currently have a stock option plan in favour of any director, officer, consultant or employee of our company. No individual grants of stock options, whether or not in tandem with stock appreciation rights known as SARs or freestanding SARs have been made to any executive officer or director since our inception; accordingly, no stock options have been granted or exercised by any of the officers or directors since we were founded.
(d) Aggregated Options Exercises in Last Fiscal Year
No individual grants of stock options, whether or not in tandem with stock appreciation rights known as SARs or freestanding SARs have been made to any executive officer or any director since our inception; accordingly, no stock options have been granted or exercised by any of the officers or directors since we were founded.
(e) Long-Tem Incentive Plans and Awards
We do not have any long-term incentive plans that provide compensation intended to serve as incentive for performance. No individual grants or agreements regarding future payouts under non-stock price-based plans have been made to any executive officer or any director or any employee or consultant since our inception; accordingly, no future payouts under non-stock price-based plans or agreements have been granted or entered into or exercised by any of the officers or directors or employees or consultants since we were founded.
(f) Compensation of Directors
The members of the Board of Directors are not compensated by Theron for acting as such. Directors are reimbursed for reasonable out-of-pocket expenses incurred. There are no arrangements pursuant to which directors are or will be compensated in the future for any services provided as a director.
We do not have any agreements for compensating our directors for their services in their capacity as directors, although such directors are expected in the future to receive stock options to purchase shares of our common stock as awarded by our board of directors.
(g) Employment Contracts, Termination of Employment, Change-in-Control Arrangements
There are no employment or other contracts or arrangements with our officers or directors other than those disclosed in this report. There are no compensation plans or arrangements, including payments to be made by Theron, with respect to the officers, directors, employees or consultants of Theron that would result from the resignation, retirement or any other termination of such directors, officers, employees or consultants. There are no arrangements for directors, officers or employees that would result from a change-in-control.
(h) Indebtedness of Directors, Senior Officers, Executive Officers and Other Management
None of our directors or executive officers or any associate or affiliate of our company during the last two fiscal years is or has been indebted to our company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding.
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(i) Family Relationships
There are no family relationships between any of our directors, executive officers or directors.
(a) Security Ownership of Certain Beneficial Owners
The following table sets forth, as of the date of this report, the total number of shares owned beneficially by each of our directors, officers and key employees, individually and as a group, and the present owners of 5% or more of our total outstanding shares. The shareholder listed below has direct ownership of his shares and possesses sole voting and dispositive power with respect to the shares.
Title of Class | Name and Address of Beneficial Owner [1] [2] [4] |
Amount & Nature of Beneficial Ownership [3] |
Percentage of Class |
Jerry R. Satchwell | 6,000,000 | 67.4% | |
common stock | 1596 Gulf Road, Number 34, | Beneficial Owner | |
Point Roberts, WA 98281 |
[1] | The person named above may be deemed to be a parent and promoter of Theron, within the meaning of such terms under the Act by virtue of his direct and indirect stock holdings. Mr. Satchwell is the only promoter of Theron Resource Group |
[2] | The person named above does not have any specified rights to acquire, within sixty (60) days of the date of this report any options, warrants or rights and no conversion privileges or other similar obligations exist. |
[3] | As of May 31, 2010, and the date of this report. |
[4] | A beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the persons actual ownership or voting power with respect to the number of shares of common stock actually outstanding. As of the date of this report, there were 7,900,000 shares of our common stock issued and outstanding. |
(b) Security Ownership of Management
The following table sets forth the names and addresses of each of our directors and officers and their respective date of commencement of their term with Theron. All directors and officers hold office until our next annual general meeting of shareholders or until a successor is appointed.
Title of Class | Name and Address of Beneficial Owner [1] [3] |
Amount & Nature of Beneficial Ownership [2] |
Percentage of Class |
Jerry R. Satchwell | |||
common stock | 1596 Gulf Road, Number 34, | 6,000,000 | 67.4% |
Point Roberts, WA 98281 | |||
Director and officer since April 11, 2006 |
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[1] | As of May 31, 2010, and the date of this report. |
[2] | Common shares beneficially owned, directly or indirectly, or over which control or direction is exercised, as at the date hereof based upon information furnished to Theron by individual directors and officers. All such shares are held directly. |
[3] | The person named above does not have any specified rights to acquire, within sixty (60) days of the date of this report any options, warrants or rights and no conversion privileges or other similar obligations exist. |
The directors, officers and other members of management of Theron, as a group beneficially own, directly or indirectly, 6,000,000 of our common shares, representing 67.4% of the total issued and outstanding securities of Theron as of May 31, 2010, and the date of this report
There are no outstanding stock options.
(c) Equity Compensation Plans
We do not have a stock option plan in favour of any director, officer, consultant or employee of our company.
(d) Changes in Control
We do not anticipate at this time any changes in control of Theron. There are no arrangements either in place or contemplated which may result in a change of control of Theron. There are no provisions within our Articles or Bylaws that would delay or prevent a change of control.
ITEM 13. CERTAIN RELATIONSHIPS and RELATED TRANSACTIONS, and DIRECTOR INDEPENDENCE
Except as disclosed herein, no director, executive officer, shareholder holding at least 5% of shares of our common stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction since the year ended May 31, 2009, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year end for the last three completed fiscal years.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The aggregate fees billed for the most recently completed fiscal year ended May 31, 2010, and for fiscal year ended May 31, 2009, for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:
Year Ended | ||||||
May 31, 2010 | May 31, 2009 | |||||
Audit Fees | $ | 6,000 | $ | 5,000 | ||
Audit Related Fees | NIL | NIL | ||||
Tax Fees | Nil | Nil | ||||
All Other Fees | Nil | Nil | ||||
Total | $ | 6,000 | $ | 5,000 |
Audit Fees: The aggregate fees billed for the fiscal year ended May 31, 2010, for professional services rendered by the principal accountant for the audit of our annual financial statements and the review of financial statements included in our filed Form 10Qs were approximately $6,000 as compared to $5,000 for the similar period of the preceding fiscal year and for the period from inception on April 11, 2006, to May 31, 2010, the amount was approximately $18,000.
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Audit-Related Fees: The aggregate fees billed for the fiscal year ended May 31, 2009, for assurance and related services by the principal accountant that are reasonably related to the performance of the audit or review for the audit or review of our annual financial statements and the review of financial statements and are not reported under the previous item, Audit Fees, was approximately $0 versus $0 for the similar period last year and for the period from inception on April 11, 2006, to May 31, 2010, the amount was $0.
Tax Fees: The aggregate fees billed for the fiscal years ended May 31, 2010, and 2009 for professional services rendered by the principal accountant for tax compliance and tax planning was approximately $0 and for the period from inception on April 11, 2006, to May 31, 2010, the amount was approximately $0.
All Other Fees: The aggregate fees billed for the fiscal years ended May 31, 2010, and 2009 for products and services provided by the principal accountant other than the services reported above was $0 and for the period from inception on April 11, 2006, to May 31, 2010, the amount was approximately $0.
Our board of directors has considered the nature and amount of fees billed by our independent auditors and believes that the provision of services for activities unrelated to the audit is compatible with maintaining our independent auditors independence.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a) | Financial Statements | |
(1) | Financial statements for our company are listed in the index under Item 8 of this report. | |
(2) | All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the financial statements or notes thereto. | |
(b) | Exhibits |
Exhibit No. | Description |
(1) | Registration Statement |
1.1 | S-1 Rescission Offering Statement dated April 3, 2010, including audited financial statements for the fiscal year ended May 31, 2009 |
(10) | Material Contracts |
10.1 | Option To Purchase And Royalty Agreement between Theron Resource Group and Bryan Livgard (incorporated by reference from our registration statement on Form SB-2 filed on October 04, 2007) |
10.2 | Code Of Business Conduct & Ethics and Compliance Program (incorporated by reference from our registration statement on Form SB-2 filed on October 04, 2007) |
(31) | Section 302 Certification |
31.1 * | Section 302 Certification - Certification of Jerry R. Satchwell as Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
31.2 * | Section 302 Certification - Certification of Jerry R. Satchwell as Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
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* Filed herewith
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
THERON RESOURCE GROUP
(Registrant)
By: | /s/ Jerry R. Satchwell | |
Jerry R. Satchwell, President, Secretary, Treasurer and Director (Principal | ||
Executive Officer, Chief Executive Officer, Principal Financial Officer and | ||
Chief Financial Officer) | ||
Date: August 31, 2010 |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/ Jerry R. Satchwell | |
Jerry R. Satchwell, President, Secretary, Treasurer and Director (Principal | ||
Executive Officer, Chief Executive Officer, Principal Financial Officer and | ||
Chief Financial Officer) | ||
Date: August 31, 2010 |
EXHIBIT 31.1
CERTIFICATIONS
I, Jerry R. Satchwell, certify that:
1. |
I have reviewed this annual report on Form 10-K of Theron Resource Group; | |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. |
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report; | |
4. |
The issuers registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and we have: | |
a) |
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; | |
b) |
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) |
evaluated the effectiveness of the issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
d) |
disclosed in this report any change in the issuers internal control over financial reporting that occurred during the issuers most recent fiscal quarter (the issuers fourth fiscal quarter in the case of this being an annual report) that has materially affected, or is reasonably likely to materially affect, the issuers internal control over financial reporting; and | |
5. |
The issuers other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuers auditors and the audit committee of the issuer's board of directors (or persons performing the equivalent function): | |
a) |
all deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the issuer's ability to record, process, summarize and report financial information; and | |
b) |
any fraud, whether or not material, that involves management or other employees who have a role in the issuers internal controls over financial reporting. |
Date: August 31, 2010
/s/ Jerry R. Satchwell
Jerry R. Satchwell
Chief Executive Officer and Principal
Executive Officer
EXHIBIT 31.2
CERTIFICATIONS
I, Jerry R. Satchwell, certify that:
1. |
I have reviewed this annual report on Form 10-K of Theron Resource Group; | |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. |
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report; | |
4. |
The issuers registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and we have: | |
a) |
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; | |
b) |
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) |
evaluated the effectiveness of the issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
d) |
disclosed in this report any change in the issuers internal control over financial reporting that occurred during the issuers most recent fiscal quarter (the issuers fourth fiscal quarter in the case of this being an annual report) that has materially affected, or is reasonably likely to materially affect, the issuers internal control over financial reporting; and | |
5. |
The issuers other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuers auditors and the audit committee of the issuer's board of directors (or persons performing the equivalent function): | |
a) |
all deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the issuer's ability to record, process, summarize and report financial information; and | |
b) |
any fraud, whether or not material, that involves management or other employees who have a role in the issuers internal controls over financial reporting. |
Date: August 31, 2010
/s/ Jerry R. Satchwell
Jerry R. Satchwell
Chief Financial Officer and Principal
Financial Officer
EXHIBIT 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002
In connection with the Annual Report of Theron Resource Group (the Company) on Form 10-K for the year ended May 31, 2010, as filed with the Securities and Exchange Commission on the date hereof (the Annual Report), I, Jerry R. Satchwell, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. |
the Annual Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. |
the information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: August 31, 2010
/s/ Jerry R. Satchwell
Jerry R. Satchwell
Chief Executive
Officer
EXHIBIT 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002
In connection with the Annual Report of Theron Resource Group (the Company) on Form 10-K for the quarter ended May 31, 2010, as filed with the Securities and Exchange Commission on the date hereof (the Annual Report), I, Jerry R. Satchwell, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. |
the Annual Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. |
the information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: August 31, 2010
/s/ Jerry R. Satchwell
Jerry R. Satchwell
Chief Financial
Officer