Item 1. Description of Business. General Development of Business We are a gold exploration company in the pre-exploration stage and were incorporated on February 14, 2007. Sillenger Exploration Corp. ("Sillenger" or the "Company") has acquired a 100% interest in three mineral claims located in the Atlin Mining Division, British Columbia, Canada, in consideration for CDN$379 (the "Bulkley mineral claims"). The claims are registered in the name of our former President, who has executed a trust agreement with us June 4, 2009, whereby she agrees to hold the claims in trust on our behalf. To date we have not performed any exploration or work on the claims. We have not had any bankruptcy, receivership or similar proceeding and have had no material reclassification, merger, consolidation or purchase or sale of a significant amount of assets other than the acquisition of the three Bulkley mineral claims.
In the fall of 2008, our shareholders began selling shares they held in us pursuant to a registration statement filed on Form S-1 with the Securities and Exchange Commission. The terms of the offering is outlined in the Form S-1 registration statement and in the Rule 424(b)(4) prospectus, both of these doucments can be found in their entirety on the SEC's website at www.sec.gov, under Registration Number 333-152075.
Our Business We are a start-up, pre-exploration-stage company, and have not yet generated or realized any revenues from our business operations. We must raise additional capital in order to continue to implement our plan and stay in business. Sillenger has acquired a 100% interest in three mineral claims located in the Atlin Mining Division, British Columbia, Canada, in consideration for CDN$379 (the "Bulkley mineral claims"). The claims are registered in the name of our former President, who has executed a trust agreement with us June 4, 2009, whereby she agrees to hold the claims in trust on our behalf. To date we have not performed any exploration or work on the claim.
We have also just recently entered into a Memorandum of Understanding with government officials of the Republic of Guinea-Bissau for business development in Guinea-Bissau.
Competitive Conditions The mineral exploration business is an extremely competitive industry. We are competing with many other exploration companies looking for minerals. We are one of the smallest exploration companies and a very small participant in the mineral exploration business. Being a junior mineral exploration company, we compete with other companies like ours for financing and joint venture partners. Additionally, we compete for resources such as professional geologists, camp staff, helicopters and mineral exploration supplies.
Raw Materials The raw materials for our exploration program will be items including camp equipment, sample bags, first aid
supplies, groceries, propane, and a global satellite telephone. All of these types of materials are readily available in either the city of Vancouver or town of Atlin in British Columbia, Canada from a variety of suppliers and can be purchased or imported to Guinea-Bissau.
Dependence on Major Customers We have no customers at this time.
Intellectual Property and Agreements We have no intellectual property such as patents or trademarks. Additionally, we have no royalty agreements or labor contracts.
Government Approvals and Regulations We are required to comply with all regulations defined in the Mineral Tenure Act of the Province of British Columbia and regulations in Guinea-Bissau.
The effect of these existing regulations on our business is that we are able to carry out our exploration program as we have described in this prospectus. However, it is possible that a future government could change the regulations that could limit our ability to explore our claim, but we believe this is highly unlikely.
Research and Development Expenditures We have not incurred any research or development expenditures since our inception on February 14, 2007.
Costs and Effects of Compliance with Environmental Laws We currently have no costs to comply with environmental laws concerning our exploration program.
Employees We have no full time or part time employees. On May 12, 2010, Mr. Gillespie was appointed as our President and Chief Executive Officer. Mr. Gillespie has agreed to allocate a portion of his time to our activities, without compensation. We anticipate that our business plan can be implemented through the efforts of of independent geologists and consultants we retain on a contract basis to conduct the exploration program on our Bulkley mineral claims, in Guinea-Bissau or as other opportunities become available to us.
Reports to Securities Holders We are required to file annual reports on Form 10-K and quarterly reports on Form 10-Q with the SEC on a regular basis, and will be required to timely disclose certain material events (e.g., changes in corporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business; and bankruptcy) in a current report on Form 8-K.
You may read and copy any materials we file with the SEC at their Public Reference Room Office, 100 F Street, NE, Room 1580, Washington, D.C. 20549-0102. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. These materials are also available electronically in Canada on SEDAR at www.sedar.com.
Item 1A.
Item 1A. Risk Factors. No disclosure is required hereunder as the Company is a "smaller reporting company," as defined in Item 10(f) of Regulation S-K.
Item 1B.
Item 1B. Unresolved Staff Comments. None. Note: No disclosure is required hereunder as the Company is a "smaller reporting company," as defined in Item 10(f) of Regulation S-K.
Item 2.
Item 2. Description of Property. Bulkley Mineral Claims Legal Status of Bulkley Mineral Claims Sillenger has acquired a 100% interest in the three mineral claims located in the Atlin Mining Division, British Columbia, Canada, in consideration for CDN$379. The claims are registered in the name of our former President, Ms. Sing, who has executed a trust agreement with us June 2, 2008, whereby she agrees to hold the claim in trust on our behalf. The total cost of the three Bulkley mineral claims charged to operations by us on our financial statements is $379 and this figure represents the reimbursement paid to our president in CDN Dollars.
All Canadian lands and minerals which have not been granted to private persons are owned by either the federal or provincial governments in the name of Her Majesty. Ungranted minerals are commonly known as Crown minerals. Ownership rights to Crown minerals are vested by the Canadian Constitution in the province where the minerals are located. In the case of the Bulkley mineral claims, that is the province of British Columbia.
In the 19th century the practice of reserving the minerals from fee simple Crown grants was established. The legislation ensures that minerals are reserved from Crown land dispositions. The result is that the Crown is the largest mineral owner in Canada, both as fee simple owner of Crown lands and through mineral reservations in Crown grants. Most privately held mineral titles are acquired directly from the Crown. The Bulkley mineral claims is one such acquisition. Accordingly, fee simple title to the Bulkley mineral claims resides with the Crown. The Bulkley mineral claims is a mining lease issued pursuant to the British Columbia Mineral Act to Ms. Sing. The lessee has exclusive rights to mine and recover all of the minerals contained within the surface boundaries of the lease continued vertically downward.
The Bulkley mineral claims is unencumbered and in good standing and there there are no third party conditions which affect the claim other than conditions defined by the Province of British Columbia described herein. Further, there is no insurance covering the Bulkley mineral claims. We believe that no insurance is necessary since the Bulkley mineral claims is unimproved and contains no buildings or improvements.
Bulkley Mineral Claims Description The claims are in an area of 947 hectares, which is equivalent to an area of 2,340 acres. The tenure number, name, owner number, work record to date, status, mining division, area, and tag numbers as typically recorded in British Columbia is as follows:
Our consulting geologist on this project is Stephen Butrenchuk and he has provided us with recommendations of how we should explore our claims.
There is no assurance that a commercially viable gold deposit exists on the claims. Explorations required before an evaluation as to the economic feasibility of the claim is determined. It is our intention to incorporate a British Columbia subsidiary company and record the deed of ownership in the name of our subsidiary if gold is discovered on the claims and it appears that it would be economically viable to commercially mine the claims. Until we can validate otherwise, the property is without known reserves and we are planning a three phase exploration program recommended by our consulting geologist. We have not commenced any exploration or work on the claims.
Access and Location of Bulkley Mineral Claims The Bulkley mineral claims are located on the Teepee property to the southeast of the TP showings (104M 048-050) and the Crine Veins (104M 081) near Tee Pee Peak about 54 kilometers west of Atlin British Columbia Lat 59 38' 29'N Long 134 32' 24' W. Elevations vary between 900 meters and about 1200 meters. Map 1, below shows the location of our claims in relation to the province of British Columbia, Canada.
Atlin is a relatively isolated community of about 350 inhabitants that is located on the east shore of Atlin Lake in northwestern British Columbia, Canada. It is 98 km south of Jake's Corner, Yukon on the Alaska Highway and 182 km from Whitehorse, Yukon. A community airstrip enables air access by small planes into Atlin.
The Bulkley claims area is accessed readily by helicopter but can be approached by means of local miners' roads that are not maintained but are passable by wheeled vehicles in the summer months and by snowmobiles in the winter. The most practical means of access is by helicopters that are normally based at Atlin during the summer season.
See maps on following pages.
Conditions to Retain Title to Bulkley Mineral Claims In order to retain title to the Sillenger Mineral Claims, in the Province of British Columbia the recorded holder of a mineral claims shall perform, or have performed, exploration and development work on the claims to a value of CDN$4 per hectare a year per unit plus a CDN$100 recording fee per claim. A statement of work must be submitted on or before the anniversary date of the claim. The anniversary date for our mineral claims is June 3, 2010. Our mineral claims is a 947 hectare area, and thus requires us to spend a minimum of CDN$4,088 on valid exploration work and recording fees to keep the claim in good standing with the Province of British Columbia. Alternately, we can make an annual payment in lieu of work to the Province of British Columbia of CDN$4 per hectare plus a CDN$100 recording fee per claim for the same CDN$4,088 in order to keep the claims in good standing with the Province of British Columbia. If we fail to make the required filings or payments, we could lose title to the claims and this could have an adverse impact on our business.
History of Atlin and of the Bulkley Mineral Claims Area The Atlin mining area gained prominence in 1898 when placer gold was discovered. A mining "rush" ensued and was most active in the period between 1898 and 1910. Exploration for gold in the Atlin area has been continuous through to the present. We do not have any verifiable information regarding previous operators on the actual Bulkley mineral claims. The Province of British Columbia maintains a free service available on the Internet call "ARIS" that allows us to locate summary reports near our claim. The summary reports are in the public domain.
Present Condition of the Bulkley Mineral Claims We do not know the present condition of the Bulkley Mineral Claims because we have yet to go on site. However, according to our consulting geologist we should expect to find terrain mostly comprised of glaciated hills with moderately steep slopes and smack streams that occupy broad channels established by glaciers and melt water streams. There is no equipment, infrastructure or electricity on the claims.
Geology of the Bulkley Mineral Claims The Bulkley mineral claims as of the writing of this report have not been visited by our consulting geologist Stephen Butrenchuk. The geology of the property is based on geological information from the Province of British Columbia. This region lies within a northeasterly trending belt of Precambrian rocks comprised of scists quartzites and orthgneiss. These rocks are unconformably overlain by volcanic rocks of the Upper Triassic Stuhini Group. These rocks have been intruded by Cretaceous to Tertiary igneous intrusions. Also present are minor intrusions of ultramafic rocks. This area has the potential to host economically important mineral deposits, including gold, cobalt, and platinum group element deposits. However, we have yet to prove that any of these types of mineral deposits exist on our claims. Our mineral claims do not have any known resource or reserves.
Description of Other Properties Sillenger does not either own nor lease office space. At present, offices are provided at no cost to Sillenger by Ms. Carolyne Sing, the President of Sillenger at 7839 17th Ave, Burnaby, British Columbia, Canada, V3N 1M1. This arrangement is expected to continue until such time as Sillenger's activities necessitates its relocation, as to which no assurances can be given. Sillenger has no agreements with respect to the maintenance or future acquisition of an office.
Item 3.
Item 3. Legal Proceedings. Sillenger is not a party to any legal proceedings.
Item 4.
Item 4. (Removed and Reserved)
Not Applicable.
PART II Item 5.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information
Our common shares became quoted on the Over-the-Counter Bulletin Board on December 8, 2008, under the symbol "SLGX". On April 4, 2010 our common shares were removed from the OTCBB and moved to the OTCQB market, under the symbol "SLGX". The following quotations reflect the high and low bids for our common stock based on inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions. The high and low bid prices for our common shares (obtained from QuoteMedia.com) from March 1, 2009 to February 28, 2010 were as follows:
Holders of Common Stock
As of May 20, 2010, we had 28 stockholders of record holding 40,811,000 shares of common stock.
Dividend Policy There are no restrictions in our articles of incorporation or bylaws that restrict us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:
1. we would not be able to pay our debts as they become due in the usual course of business; or
2. Our total assets would be less than the sum of our total liabilities, plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.
We declared a six share for every one share issued and outstanding stock dividend in March 2009. The record date for this stock dividend was March 25, 2009 and the pay date was March 27, 2009. As a result of the issuance of this stock dividend our issued and outstanding share capital increased from 5,853,000 shares to 40,971,000 shares of common stock.
We do not plan to declare any further dividends in the foreseeable future.
Equity Compensation Plan
We do not have any securities authorized for issuance under any equity compensation plans.
Recent Sales of Unregistered Securities On December 14, 2009, we issued 50,000 shares of our Common Stock to one investor, for an aggregate purchase price of $10,000. We relied on the exemption provided by Rule 903 of Regulation S of the Securities Act of 1934 to the subscriber on the basis that the sale of the shares was completed in an offshore transaction, as defined in Rule 902(h) of Regulation S. The Company did not engage in any directed selling efforts, as defined in Regulation S, in the United States in connection with the sale of the shares. The investor represented to us that he was not a U.S. person, as defined in Regulation S, and was not acquiring the shares for the account or benefit of a U.S. person. The subscription agreement executed between us and the investor included statements that the securities had not been registered pursuant to the Securities Act of 1933 and that the securities may not be offered or sold in the United States unless the securities are registered under the Securities Act of 1933 or pursuant to an exemption from the Securities Act of 1933. The investor agreed by execution of the subscription agreement for the shares: (i) to resell the securities purchased only in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933 or pursuant to an exemption from registration under the Securities Act of 1933; (ii) that we are required to refuse to register any sale of the securities purchased unless the transfer is in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933 or pursuant to an exemption from registration under the Securities Act of 1933; and (iii) not to engage in hedging transactions with regards to the securities purchased unless in compliance with the Securities Act of 1933. All securities issued were endorsed with a restrictive legend confirming that the securities had been issued pursuant to Regulation S of the Securities Act of 1933 and could not be resold without registration under the Securities Act of 1933 or an applicable exemption from the registration requirements of the Securities Act of 1933.
Item 6.
Item 6. Selected Financial Data. No disclosure is required hereunder as the Company is a "smaller reporting company," as defined in Item 10(f) of Regulation S-K.
Item 7.
Item 7. Management Discussion and Analysis or Plan of Operations. 2010 Business Environment
The disruptions in the credit and financial markets through 2008 and 2009 have had a significant material adverse impact on a number of financial institutions and have limited access to capital and credit for many companies. While 2009 seemingly was a turnaround year for stock markets, and a muted positive improvement in consumer optimism and general business conditions, the global economy still appears to be somewhat tepid, and it is still difficult for many junior resource companies to obtain financing. These market conditions could continue to make it difficult for us to obtain, or increase our cost of obtaining, capital and financing for our operations. Our access to additional capital on the equity markets also may not be available on terms acceptable to us or at all.
In late 2009 Sillenger decided to seek a strategic and/or financial partner to help take Sillenger forward. We entered into discussions with an interested party with the goal of raising capital and conducting a work program on the Bulkley claims, and possibly some other projects. Unfortunately the two sides could not reach an acceptable deal and we parted ways. With the price of gold at record levels, management believes it would be prudent to continue seeking potential partners.
Results of Operation For the year ended February 28, 2010 and February 29, 2009 and the period from February 14, 2007 (inception) to February 28, 2010:
Financial Condition and Liquidity Revenue - Sillenger has not generated revenue from its business operations and does not expect to generate any revenue in the near future.
Common Stock - Management anticipates Sillenger's external sources of liquidity will be private placements for equity conducted outside the United States. During the year ended February 28, 2010, Sillenger completed a private placement on December 14, 2009 where Sillenger issued 50,000 shares of common stock at $0.20 per share for proceeds of $10,000 (year ended February 29, 2009 - $0.00).
Liquidity - At February 28, 2010, Sillenger had assets of $6,700 consisting of cash ($15,699 - February 29, 2009). Sillenger had $ 7,599 ($7,000 - February 29, 2009) in liabilities of which is owed for Accounts Payable.
Sillenger' internal sources of liquidity will be loans that may be available to Sillenger from management. Although Sillenger has no written arrangements with any of directors and officers, Sillenger expects that the directors and officers will provide Sillenger with internal sources of liquidity, if it is required.
There are no assurances that Sillenger will be able to achieve further sales of its common stock or any other form of additional financing. If Sillenger is unable to achieve the financing necessary to continue its plan of operations, then Sillenger will not be able to continue its exploration programs and its business will fail.
Expenses Summary - Total expenses were $19,598 for the year ended February 28, 2010. Expenses have decreased as compared to the year ended February 28, 2009 by $12,792 from $ 32,390 in the previous year ended February 29, 2009. A total of $62,049 in expenses has been incurred by Sillenger since inception on February14, 2007 through to February 28, 2010. The increase in costs over the past year is primarily related to Sillenger having filed a registration statement to qualify shares held by its stockholders for resale. The costs can be subdivided into the following categories.
Other Expenses: $3,539 in other expenses (includes rent and administrative costs) were incurred for the year ended February 28, 2010 as compared to $8,061 for the year ended February 28, 2009 while a total of $12,617 was incurred in the period from inception on February 14, 2007 to February 28, 2010.
Professional Fees: Sillenger incurred $16,059 in professional fees for the year ended on February 28, 2010 as compared to $23,449 for the year ended February 29, 2009. From inception to February 28, 2010, we have incurred a total of $48,172 in professional fees mainly spent on legal and accounting matters.
Exploration Costs: Sillenger relies primarily on outside consultants and not salaried employees to conduct its exploration of its property. As a result, Sillenger incurred $0.00 in exploration costs for the year ended February 28, 2010 and $880 was incurred for the year ended February 29, 2009. For the period February 14, 2007 (inception) through February 28, 2010, Sillenger has spent a total of $1,260 on exploration.
Sillenger continues to carefully control its expenses and overall costs as it moves forward with the development of its business plan. Sillenger does not have any employees and engages personnel through outside consulting contracts or agreements or other such arrangements.
Plan of Operations Exploration Plan Our business plan up until April this year was to proceed with the exploration of the Bulkley claims to determine whether there are commercially exploitable reserves of base and precious metals. Although we have enough cash to complete our Phase One exploration program. We do not have enough funds to complete our Phase Two or Phase Three programs which we would plan to start Phase Two in the summer of 2010 if the results of our Phase One exploration program is successful. We currently do not have any arrangements for financing and we may not be able to obtain financing when required or on favorable terms. We are currently relying on loans that may be available to Sillenger from management.
With the price of gold at record levels, management believes it would be prudent to continue seeking potential partners to explore the Buckley claims.
We will also need to seek additional funding to pursue the new ventures in Africa identified by our new President and Chief Executive Officer Mr. John Gillespie. We anticipate that additional funding will be in the form of equity financing from the sale of our common stock. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund additional phases of the exploration program previously set out for the Buckley claim should we decide to proceed or any new projects identified in Africa. We believe that debt financing will not be an alternative for funding any further phases in our exploration program or potential projects in Africa or elsewhere. The risky nature of these enterprises and lack of tangible assets places debt financing beyond the credit-worthiness required by most banks or typical investors of corporate debt until such time as an economically viable mine or project can be demonstrated. We do not have any arrangements in place for any future equity financing.
Based on the nature of our business, we anticipate incurring operating losses in the foreseeable future. We base this expectation, in part, on the fact that very few mineral claims in the exploration stage ultimately develop into producing, profitable mines. Our future financial results are also uncertain due to a number of factors, some of which are outside our control. These factors include, but are not limited to:
our ability to raise additional funding;
the market price for gold;
the results of our proposed exploration programs on the mineral property; and
our ability to find joint venture partners for the development of our property interests
Due to our lack of operating history and present inability to generate revenues, our auditors have stated their opinion that there currently exists substantial doubt about our ability to continue as a going concern.
Subsequent Events In April 2010, Ms. Sing was introduced to Mr. John Gillespie of Toronto, Ontario. Ms. Sing and Mr. Gillespie held several discussions about how he could assist Ms. Sing in taking Sillenger forward as a company. Mr. Gillespie had, in Ms. Sing's opinion, some interesting ideas on natural resource exploration and concepts of maximizing returns while diminishing risks, and building value for Sillenger shareholders.
On May 12, 2010, Ms. Sing resigned as President and Chief Executive officer of Sillenger and appointed Mr. Gillespie as President and Chief Executive Officer of Sillenger.
Mr. Gillespie intends to utilize his network of contacts and agents in Africa to assist Sillenger in raising capital for African exploration projects.
Mr. Gillespie has also developed a proprietary method of land claims management that he believes will be of interest to governments of developing countries, particularly in certain African countries which foreign investors view as high risk due to perceived country instability. Mr. Gillespie believes his land claims management system addresses many of the concerns held by foreign investors and resource companies in such countries. He also believes his concept will also appeal to resource companies in particular because it is designed to create a win-win scenario for both the governments and the resource companies.
On May 6, 2010, Sillenger announced a Memorandum of Understanding (MOU) with officials of the Republic of Guinea-Bissau for business development in Guinea-Bissau based on Mr. Gillespie's land claims mangement system.
On May 19, 2010, Sillenger appointed geologist, Dr. Allan Juhas, PhD, Director of Exploration for Sillenger. Dr. Juhas will evaluate opportunities and oversee Sillenger's exploration operations. Dr. Juhas is an Economic Geologist with extensive domestic and international experience in the management, design and supervision of exploration programs.
On May 26, 2010, Sillenger introduced its proprietary CLP Claims Licensing Program which is designed to help governments to provide a fast-track process for issuing the necessary bureaucratic documentation to resource companies. The system helps reduce risk to exploration companies and helps market a country as an attractive investment destination. This program is based on Mr. Gillespie's proprietary land claims management system.
On May 26, 2010, Ms. Sing closed an agreement with Mr Gillespie to sell Mr. Gillespie her block of Sillenger shares, which represents a controlling interest in Sillenger. Ms. Sing has agreed to step down as a director of Sillenger, and Mr. Gillespie will be appointed as a director as soon as possible.
Item 7A.
Item 7A. Quantitive and Qualitive Disclosure About Market Risk. No disclosure is required hereunder as the Company is a "smaller reporting company," as defined in Item 10(f) of Regulation S-K.
Item 8.
Item 8. Financial Statements and Supplementary Data. The financial statements and schedules that constitute Item 8 of Form 10-K immediately follow on the next page.
Sillenger Exploration Corp.
(An Exploration Stage Company)
February 28, 2010
Index
Report of Independent Registered Public Accounting Firm
Balance Sheets as of February 28, 2010 and 2009
Statements of Operations for the years ended
February 28, 2010 and 2009 and the period from
February 14, 2007 (Inception) through February 28, 2010
Statement of Stockholders' Equity (Deficit) as of February 28, 2010
Statements of Cash Flows for the years ended
February 28, 2010 and 2009 and the period from
February 14, 2007 (Inception) through February 28, 2010
Notes to the Financial Statements -
Silberstein Ungar, PLLC CPAs and Business Advisors
Phone (248) 203-0080
Fax (248) 281-0940
30600 Telegraph Road, Suite 2175
Bingham Farms, MI 48025-4586
www.sucpas.com
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Sillenger Exploration Corp.
Vancouver, British Columbia, Canada
We have audited the accompanying balance sheets of Sillenger Exploration Corp., as of February 28, 2010 and 2009, and the related statements of operations, stockholders' equity (deficit), and cash flows for the years then ended and the period from February 14, 2007 (date of inception) through February 28, 2010. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our 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 has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over 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 Sillenger Exploration Corp. as of February 28, 2010 and 2009, and the results of its operations and its cash flows for the periods then ended and the period from February 14, 2007 (date of inception) through February 28, 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, the Company has negative working capital, has received no revenue from sales of products or services, and has incurred losses from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans with regard to these matters are described in Note 2. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Silberstein Ungar, PLLC
Silberstein Ungar, PLLC
Bingham Farms, Michigan
May 25,
SILLENGER EXPLORATION CORP.
(AN EXPLORATION STAGE COMPANY)
BALANCE SHEETS
AS OF FEBRUARY 28, 2010 AND 2009
ASSETS
Current Assets
Cash
$ 6,700
$ 15,699
TOTAL ASSETS
$ 6,700
$ 15,699
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
LIABILITIES
Current Liabilities
Accrued expenses
$ 7,599
$ 7,000
Total Liabilities
7,599
7,000
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $.001 par value, 75,000,000 shares authorized, 40,811,000 shares issued and outstanding after 6:1 stock split (February 28, 2009 - 40,761,000 issued and outstanding)
40,811
5,823
Additional paid in capital
3,514,139
45,327
Deficit accumulated during the exploration stage
(3,555,849)
(42,451)
Total stockholders' equity (deficit)
(899)
8,699
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
$ 6,700
$ 15,699
See accompanying notes to financial statements.
SILLENGER EXPLORATION CORP.
(AN EXPLORATION STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED FEBRUARY 28, 2010 AND 2009
PERIOD FROM FEBRUARY 14, 2007 (INCEPTION) TO FEBRUARY 28, 2010
Year ended February 28, 2010
Year ended February 28, 2009
Period from February 14, 2007 (Inception) to February 28, 2010
REVENUES
$
$
$
OPERATING EXPENSES
Professional fees
16,059
23,449
48,172
Exploration costs
1,260
Other
3,539
8,061
12,617
TOTAL OPERATING EXPENSES
19,598
32,390
62,049
LOSS FROM OPERATIONS
(19,598)
(32,390)
(62,049)
PROVISION FOR INCOME TAXES
NET LOSS
$ (19,598)
$ (32,390)
$ (62,049)
NET LOSS PER SHARE: BASIC AND DILUTED
$ (0.00)
$ (0.00)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED
40,781,833
40,761,000
See accompanying notes to financial statements.
SILLENGER EXPLORATION CORP.
AN EXPLORATION STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
PERIOD FROM FEBRUARY 14, 2007 (INCEPTION) TO FEBRUARY 28, 2010
See accompanying notes to financial statements.
SILLENGER EXPLORATION CORP.
(A EXPLORATION STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE YEARS ENDED FEBRUARY 28, 2010 AND 2009
PERIOD FROM FEBRUARY 14, 2007 (INCEPTION) TO FEBRUARY 28, 2010
Year ended February 28, 2010
Year ended February 28, 2009
Period from February 14, 2007 (Inception) to February 28, 2010
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period
$ (19,598)
$ (32,390)
$ (62,049)
Changes in assets and liabilities:
Increase in accrued expenses
3,500
7,599
Cash Flow Used in Operating Activities
(18,999)
(28,890
(54,450)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock
10,000
-
61,150
Cash Flows Provided by Financing Activities
10,000
-
61,150
NET INCREASE (DECREASE) IN CASH
(8,999)
(28,890)
6,700
Cash, beginning of period
15,699
44,589
-
Cash, end of period
$ 6,700
$ 15,699
$ 6,700
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid
$ -
$ -
$ -
Income taxes paid
$ -
$ -
$ -
NON-CASH FINANCING AND INVESTING TRANSACTIONS:
Increase in paid in capital for stock dividend
$ 3,493,800
$ -
$ 3,493,800
Increase in accumulated deficit for stock dividend
$ (3,493,800)
$ -
$ 3,493,800
See accompanying notes to financial statements.
SILLENGER EXPLORATION CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
FEBRUARY 28, 2010
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
Sillenger Exploration Corp. ("Sillenger" or the "Company") was incorporated in Nevada on February 14, 2007. Sillenger is an exploration stage company and has not yet realized any revenues from its planned operations. Sillenger is currently in the process of acquiring certain mining claims.
Accounting Basis
These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents
Financial Instruments
The Company's financial instruments consists of cash and accrued expenses.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles of the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. The more significant areas requiring the use of estimates include asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.
Loss Per Share
Basic loss per share is calculated using the weighted average number of common shares outstanding and the treasury stock method is used to calculate diluted earnings per share. For the years presented, this calculation proved to be anti-dilutive.
Dividends
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during the period shown.
Income Taxes
The Company provides for income taxes using an asset and liability approach. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. The Company's predecessor operated as entity exempt from Federal and State income taxes.
Deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
SILLENGER EXPLORATION CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
FEBRUARY 28, 2010
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Mineral Properties
Cost of license acquisition, exploration, carrying and retaining unproven mineral lease properties are expensed as incurred. Costs of acquisition are capitalized subject to impairment testing, in accordance with SFAS 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", when facts and circumstances indicate impairment may exist.
Comprehensive Income
The Company has adopted SFAS 130 "Reporting Comprehensive Income", which establishes standards for reporting and display of comprehensive income, its components and accumulated balances. When applicable, the Company would disclose this information on its Statement of Stockholders' Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive income.
Recent Accounting Pronouncements
Sillenger does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company's results of operations, financial position or cash flow.
NOTE 2 - GOING CONCERN
Sillenger has recurring losses and has accumulated operating losses during the exploration stage of $62,049 as of February 28, 2010. Sillenger's financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, Sillenger has no current source of revenue. Without realization of additional capital, it would be unlikely for Sillenger to continue as a going concern. Sillenger's management plans on raising cash from public or private debt or equity financing, on an as needed basis and in the longer term, revenues from the acquisition, exploration and development of mineral interests, if found. Sillenger's ability to continue as a going concern is dependent on these additional cash financings, and, ultimately, upon achieving profitable operations through the development of mineral interests.
NOTE 3 - MINERAL PROPERTY RIGHTS
During the period ended February 28, 2008, the Company acquired a 100% interest in three mining claims in the Bulkley mining district of British Columbia, Canada for cash consideration of $379. The property is being held in trust for the Company by a third party. On May 15, 2009 the Company abandoned the mineral titles and re-staked them in order to reduce exploration costs.
NOTE 4 - COMMITMENTS
Sillenger neither owns nor leases any real or personal property, an officer has provided office services without charge. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.
SILLENGER EXPLORATION CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
FEBRUARY 28, 2010
NOTE 5 - INCOME TAXES
The provision for Federal income tax consists of the following:
Refundable Federal income tax attributable to:
Current Operations
$ 6,663
$ 11,013
Less: valuation allowance
(6,663)
(11,013)
Net provision for Federal income taxes
$ -
$ -
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:
Deferred tax asset attributable to:
Net operating loss carryover
$ 21,096
$ 14,433
Less: valuation allowance
(21,096)
(14,433)
Net deferred tax asset
$ -
$ -
At February 28, 2010, Sillenger had an unused net operating loss carryover approximating $62,049 that is available to offset future taxable income; it expires beginning in 2027.
NOTE 6 - COMMON STOCK
At inception, Sillenger issued 3,000,000 shares of stock to its founding shareholder for $3,000 cash.
During the period ended February 28, 2008, Sillenger issued 2,823,600 shares of stock for $48,150 cash.
During the period ended February 28, 2010, the company issued 50,000 shares of stock for $ 10,000 cash.
During the period ended February 28, 2010, the company declared a 6 to 1 stock dividend. The stock was valued at $0.10 per share at the grant date.
As of February 28, 2010 there are 40,811,000 shares of common stock issued and outstanding.
NOTE 7 - SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855-10) the Company has analyzed its operations subsequent to February 28, 2010 and has determined that it does not have any material subsequent events to disclose in these financial statements.
Item 9.
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure. Sillenger has not changed accountants since its formation and there are no disagreements with the findings of said accountants.
Item 9A.
Item 9A. Controls and Procedures. (a) Evaluation of Disclosure Controls and Procedures
Disclosure controls are 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. Disclosure controls and procedures include, without limitation, are controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Our management carried out an evaluation (with the participation of our CEO and CFO), of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, the Company's CEO and CFO have concluded that the Company's disclosure controls and procedures were effective as of February 28, 2010.
(b) Internal control over financial reporting
Management's annual report on internal control over financial reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is intended to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Our internal control over financial reporting should include those policies and procedures that:
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with applicable GAAP, and that receipts and expenditures are being made only in accordance with authorizations of management and the Board of Directors; and
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
As required by Rule 13a-15(c) promulgated under the Exchange Act, our management, with the participation of our Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), evaluated the effectiveness of our internal control over financial reporting as of February 28, 2010. Management's assessment took into consideration the size and complexity of the company and was based on criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control over Financial Reporting -Guidance for Smaller Public Companies. In performing the assessment, management has concluded that our internal control over financial reporting was effective as of February 28, 2010.
Attestation report of the registered public accounting firm
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 temporary rules of the Securities and Exchange Commission that permit the company to provide only management's report in this annual report.
Changes in internal control over financial reporting
There were no changes in our internal controls that occurred during the year covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls.
Changes in Internal Controls
Based on the evaluation as of February 28, 2010, Carolyne Sing, our former President, Chief Executive Officer, and Chief Financial Officer has concluded that there were no significant changes in our internal controls over financial reporting or in any other areas that could significantly affect our internal controls subsequent to the date of his most recent evaluation, including corrective actions with regard to significant deficiencies and material weaknesses.
Item 9a(T) - Controls And Procedures. See Item 9A - Controls and Procedures above.
Item 9B.
Item 9B. Other Information. None.
PART III Item 10.
Item 10. Directors and Executive Officers, Promoters and Corporate Governance. Identification of Directors and Executive Officers The following table sets forth the names, positions and ages of our executive officer and directors.
Name
Age
Position
Since
John Gillespie
President and CEO
May 12, 2010
Carolyne Sing
CFO, Treasurer, Principal Accounting Officer, Secretary and Director (former President and CEO)
February 14, 2007
There are no arrangements or understandings regarding the length of time a director of the Company is to serve in such a capacity.
Background of Officers and Directors Set forth below is a brief description of the background and business experience of our current executive officers and directors:
John Gillespie Mr. Gillespie has been the President and Chief Executive Officer of Sillenger since May 12, 2010. Mr. Gillespie has over thirty (30) years experience as a Senior Executive, including being President and Chief Executive Officer for major corporations. Mr. Gillespie brings senior corporate expertise in licensing, legal and royalty mechanisms to
Sillenger. During the past decade, Mr. Gillespie has proven to be a visionary leader by engineering a wide range of solutions in licensing, real estate and land management, labor negotiations, legal frameworks, marketing and business development, administration, and rapid revenue growth. Prior to joining the Registrant, Mr. Gillespie served for seven years as Vice President of Operations for Pizzaville in Ontario, Canada. He served for two years as Vice President of Franchise and Real Estate Development with Afton Food Group, Inc., also in Ontario. He also served as Principal of Gillespie and Associates, where he provided major corporate clients with executive franchise advice on business development, legal, real estate, leasing and general business administration. From 1978 to 1997 he served as President and Chief Executive Officer for major companies, including Ryan's Pet Food, Inc. Chicken Chicken, Inc., Goligers Travel, Inc. and Pizza Pizza, Inc. Under his leadership, the companies grew rapidly, with combined sales of over $200 Million.In 1987 Mr. Gillespie earned the honor of being awarded "Executive of the Year" by the Canadian Franchise Association (CFA) for his efforts in transforming the CFA into an organization dedicated to teaching and promoting ethical franchise methods and business practices. He also served as the organizations' Chairman from 1984 to 1986.
Mr. Gillespie does not hold a directorship in any other reporting company.
Carolyne Sing Ms. Sing has been a director and officer of the Company since our inception on February 14, 2007. She currently holds the office of Chief Financial Officer, Treasurer, Principal Accounting Officer and Secretary of the Company. During the past five years, Ms. Sing has been a businesswoman in Vancouver, Canada, a private investor in residential and commercial real estate, blue chip equities, and fixed income instruments. In addition, she has freelanced as a tutor in high school mathematics and sciences, and served as a research assistant in various biological control projects at UBC and Agriculture Canada.
Given that Ms. Sing has no previous experience in mineral exploration or operating a mining company, she intends to perform her job for us by engaging consultants who have experience in the areas where she is lacking. Ms. Sing has worked to familiarize herself with our business by attending technical courses in Economic Geology at BCIT as well as various mineral exploration conferences in the summer and autumn of 2008.
Ms. Sing acted as our President and Chief Executive Officer since our incorporation on February 14, 2007 to May 12, 2010.
Ms. Sing does not hold a directorship in any other reporting company.
Term of Office Our director has been appointed to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Conflicts of Interest We do not have any procedures in place to address conflicts of interest that may arise in our directors between our business and their other business activities.
During the last two years, prior to his appointment as an officer o the Company there has been no transaction or proposed transaction that the Company was or is a party to in which Mr. Gillespie had or is to have a direct or indirect material interest.
We do not expect any conflict of interest between any of our officers or directors and the Company in the future.
Significant Employees Sillenger has no employees who are not executive officers, but who are expected to make a significant contribution to our business.
Involvement in Certain Legal Proceedings
During the past five years, none of our directors or officers have been:
a general partner or executive officer of any business against which any bankruptcy petition was filed, either at the time of the bankruptcy or two years prior to that time;
convicted in a criminal proceeding or named subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission 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.
Family Relationships There are no family relationships between any two or more of our directors or executive officers. There is no arrangement or understanding between any of our directors or executive officers and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current board of directors. There are also no arrangements, agreements or understandings to our knowledge between non-management shareholders that may directly or indirectly participate in or influence the management of our affairs.
Audit Committee Financial Expert Sillenger does not have a standing Audit Committee. The functions of the Audit Committee are currently assumed by our Board of Directors. Additionally, Sillenger does not have a member on its board of directors that has been designated as an audit committee "financial expert." Sillenger does not believe that the addition of such an expert would add anything meaningful to Sillenger at this time. It is also unlikely Sillenger would be able to attract an independent financial expert to serve on its Board of Directors at this stage of its development. In order to entice such a director to join its Board of Directors Sillenger would probably need to acquire directors' errors and omission liability insurance and provide some form of meaningful compensation to such a director; two things Sillenger is unable to afford at this time.
No Nominating Committee We do not have a standing nominating committee, our Board of Directors is responsible for identifying new candidates for nomination to the Board. We have not adopted a policy that permits shareholders to recommend candidates for election as directors or a process for shareholders to send communications to the Board of Directors.
Compliance with Section 16(a) of the Securities Exchange Act of 1934 Under the securities laws of the United States, our directors, executive officers (and certain other officers) and any persons holding more than 10% of our outstanding voting securities are required to report their ownership in our securities and any changes in that ownership to the SEC. Based solely upon reliance on the verbal and written representations of our director and officer, we believe we are in compliance with Section 16(a) of the Securities Exchange Act of 1934. Under this section Ms. Carolyne Sing is now required to file a Form 3 initial report with the Securities and Exchange Commission and file a Form 4 on any subsequent changes.
Other than as disclosed below, Ms. Sing has not bought or sold any securities since February 14, 2007 when we issued 3,000,000 shares of our common stock to Ms. Carolyne Sing, for an aggregate purchase price of $3,000.00. These shares were subsequently forward split to represent 21,000,000 share of our common stock in March of 2009 along with all other issued and outstanding shares of Sillenger. On May 26, 2010, Mrs. Sing closed an agreement with Mr Gillespie to sell Mr. Gillespie her entire block of Sillenger shares, which represents a 51.46% controlling interest in Sillenger.
Code of Ethics Sillenger has not adopted a Code of Ethics at this time and the Board of Directors of Sillenger is reviewing the necessity of adopting such a document at this time by Sillenger given the composition of its Board of Directors and Officer and its scale of its operations at this time.
Item 11.
Item 11. Executive Compensation. Summary Compensation of Executive Officers The following table contains information concerning the compensation paid during our fiscal years ended February 28, 2010, February 28, 2009 and February 28, 2008 to the persons who served as our Chief Executive Officers, and each of the two other most highly compensated executive officers during our 2010 fiscal year (collectively, the "Named Executive Officers").
Compensation of Directors Director Compensation Table The following table sets forth all compensation awarded to, earned by, or paid for services rendered to us in all capacities during the fiscal years ended February 28, 2010, February 28, 2009 and February 29, 2008, by our directors.
Name
Year
Fees Earned or
Paid in Cash
($)
Stock Awards or Options
(#)
All other Compensation All other Compensation
($)
Carolyne Sing
None
None
None
None
None
None
None
None
None
General Sillenger's sole officer and director for the years ended February 28, 2010, February 28, 2009, and February 28, 2008 has not received any compensation for her services rendered to Sillenger since inception. Carolyne Sing has agreed to act without compensation until authorized by the Board of Directors. Further, Carolyne Sing is not accruing any compensation pursuant to any agreement with Sillenger.
Equity Compensation Plan We do not presently have a equity compensation plan or stock option plan but intend to develop an incentive based stock option plan for our officers and directors in the future and may reserve up to 20% of our outstanding shares of common stock for that purpose.
Employment Contracts and Termination of Employment or Change of Control
We have no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation or retirement).
No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by Sillenger for the benefit of its employees.
No Compensation Committee We do not have a compensation committee. The functions of the compensation committee are currently carried out by our Board of Directors.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. Principal Stockholders, Directors and Officers The following table sets forth certain information as of May 31, 2010, regarding the beneficial ownership of Sillenger's Common Stock by (i) each stockholder known by Sillenger to be the beneficial owner of more than 5% of Sillenger's Common Stock, (ii) by each Director and executive officer of Sillenger and (iii) by all
executive officer and Directors of Sillenger as a group. Each of the persons named in the table has sole voting and investment power with respect to Common Stock beneficially owned.
There are currently no options, warrants, rights or other securities conversion privileges granted to our officer, director or beneficial owner.
Equity Compensation Plan We did not have an equity compensation plan in place during the fiscal year ended February 28, 2010.
Changes in Control On May 26, 2010, Mr Gillespie acquired 21,000,000 shares of the common stock of Sillenger previously held by Ms. Carolyne Sing. These shares represent Ms. Sing's entire block of Sillenger shares, which represents a 51.46% controlling interest in Sillenger.
There are no present arrangements or pledges of Sillenger's securities which may result in a change in control of Sillenger.
Item 13.
Item 13. Certain Relationships and Related Transactions, and Director Independence. Certain Relationships and Related Transactions On February 14, 2007 our sole Director and Officer, Carolyne Sing acquired 3,000,000 shares of our common stock at a price of $0.001 for proceeds of $3,000. These shares were subsequently forward split to represent 21,000,000 share of our common stock in March of 2009. On May 26, 2010, Mrs. Sing closed an agreement with Mr Gillespie to sell Mr. Gillespie her entire block of Sillenger shares, which represents a 51.46% controlling interest in Sillenger.
In return for Ms. Sing holding the Bulkley mineral claims in trust for us, we have agreed to make payments on behalf of Ms. Sing holding to keep the claim on good standing with the Province of British Columbia. We anticipate the amount of the payments to be made on behalf of Ms. Sing to be CDN $2,200 annually.
Ms. Sing donates services and rent to us that are recognized on our financial statements.
Except as noted above, none of the following parties has, since our inception on February 14, 2007, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
Any of our directors or officers;
Any person proposed as a nominee for election as a director;
Any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to our outstanding shares of common stock;
Any of our promoters;
Any relative or spouse of any of the foregoing persons who has the same house as such person.
The promoter of our company is Carolyne Sing. Except for the transactions with Ms. Sing noted above, there is nothing of value to be received by each promoter, either directly or indirectly, from us. Additionally, except for the transactions noted above, there have been no assets acquired or are any assets to be acquired from each promoter, either directly or indirectly, from us.
Director Independence We currently do not have any independent directors, as the term "independent" is defined by Nasdaq Marketplace Rule 4200(a)(15). An "independent director" means a person other than an executive officer or employee of the issuer or any other individual having a relationship which, in the opinion of the issuer's board of directors, would interfere with the exercise of independent judgement in carrying out the responsibilities of a director, and includes any director who accepted any compensation from the issuer in excess of $200,000 during any period of 12 consecutive months with the three past fiscal years. Also, the ownership of the issuer's stock will not preclude a director from being independent.
We currently only have one director on our Board of Directors, Ms. Carolyne Sing.
The Company is currently traded on the OTCQB, which does not require that a majority of the Board be independent.
We do not have a compensation committee, nominating committee or audit committee. The functions of these committees are performed by our Board of Directors.
Item 14.
Item 14. Principal Accountant Fees and Services. Fees and Services We were formed February 14, 2007. Silberstein Ungar, PLLC, Certified Public Accountants and Business Advisors, audited our financial statements for fiscal 2009 and 2010. The following is an aggregate of fees billed for each of the last two years for professional services rendered by our principal accountants:
Pre-Approval Policies and Procedures We understand the need for our principal accountants to maintain objectivity and independence in their audit of our financial statements. To minimize relationships that could appear to impair the objectivity of our principal accountants, our audit committee has restricted the non-audit services that our principal accountants may provide to us primarily to tax services and review assurance services.
We are only to obtain non-audit services from our principal accountants when the services offered by our principal accountants are more effective or economical than services available from other service providers, and, to the extent possible, only after competitive bidding. These determinations are among the key practices adopted by the audit committee effective during fiscal 2010. The board has adopted policies and procedures for pre-approving work performed by our principal accountants.
After careful consideration, the audit committee of the board of directors has determined that payment of the above audit fees is in conformance with the independent status of our company's principal independent accountants. Before engaging the auditors in additional services, the audit committee considers how these services will impact the entire engagement and independence factors.
PART IV Item 15.
Item 15. Exhibits, Financial Statement and Schedules
Exhibit Number
Exhibit Title
3.1
Articles of Incorporation (incorporated by reference from our Form SB-1 Registration Statement, filed July 2, 2008).
3.3
10.1
Bylaws (incorporated by reference from our Form SB-1 Registration Statement, filed July 2, 2008).
Buckley Declaration of Trust concerning our mineral claims (incorporated by reference from our Form S-1 Registration Statement, filed June 2, 2008).
31.a
Section 906 Certificate of CEO
31.b
Section 906 Certificate of CFO
32.a
Section 302 Certificate of CEO & CFO
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.
SILLENGER EXPLORATION CORP.
/s/ John Gillespie
By:
John Gillespie, President and Chief Executive Officer
Date:
June 1, 2010
Pursuant to the requirements of Section 13 or 15(d) 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 indicated.
/s/ John Gillespie
By:
John Gillespie, President and Chief Executive Officer
Date:
June 1, 2010
/s/ Carolyne Sing
By:
Carolyne Sing, Secretary, Treasurer, Chief Financial Officer,
Principal Accounting Officer and Director
Date:
June 1, 2010