Initial Public Offering (IPO): Pre-Effective Amendment to Registration Statement (General Form) — Form S-1 Filing Table of Contents
Document/ExhibitDescriptionPagesSize 1: S-1/A Amended Form S-1 HTML 781K
2: EX-5.1 Opinion re: Legality HTML 16K
3: EX-23.1 Consent of Experts or Counsel HTML 6K
4: EX-23.2 Consent of Experts or Counsel HTML 7K
number,
including area code, of agent for service)
Approximate date of commencement of
proposed sale to the public: As soon as practicable after this
Registration Statement becomes effective.
If
any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box:
[X]
If
this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.
[ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering.
[ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering.
[ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer”,
“accelerated filer” and “smaller reporting company in Rule 12b-2 of the
Exchange Act.
Non-accelerated
filer
[ ] (Do not check if a smaller
reporting
company) Smaller
reporting company [ X ]
Page
- 1
CALCULATION
OF REGISTRATION FEE
Title
of Each Class of
Securities
To Be Registered
Amount
to be
registered
Proposed
Maximum
Offering
Price
per
Unit [1]
Proposed
Maximum
Aggregate
Offering
Price [1]
Amount
of
Registration
Fee
Units,
each consisting of one share of Common Stock,
$0.001
par value, and one Warrant, to be registered by issuer
15,000,000
Units
$0.10
$1,500,000
$58.95
Shares
of Common Stock included as part of the Units,
to
be registered by issuer
15,000,000
shares
-
-
-
[3]
Warrants
included as part of the Units, to be registered by issuer
15,000,000
Warrants
-
-
-
[3]
Shares
of Common Stock underlying the Warrants included in the Units, to be
registered by issuer [2]
15,000,000
shares
$0.15
$2,250,000
$88.43
Shares
of Common Stock: $0.001 par value,
to
be registered by selling shareholders
64,630,000
shares
$0.10
$6,463,000
$254.00
Total
-
-
$10,213,000
$401.38
[1] Estimated
in accordance with Rule 457(c) solely for the purpose of calculating the
registration fee based on a bona fide estimate of the maximum offering
price.
[2] These
are the maximum number of shares of common stock that can be issued if all
of the share purchase warrants underlying the unit offering are
exercised. The maximum offering price is based upon the
exercise price of the warrants.
[3] No
fee pursuant to Rule 457(g).
THE
REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
Page
- 2
The
information in this prospectus is not complete and may be changed.
Wolverine and the selling shareholders may not sell these securities until
the registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities and it is
not soliciting an offer to buy these securities in any state where the offer or
sale is not permitted.
Subject
to Completion
Dated
*, 2008
Prospectus
WOLVERINE
EXPLORATION INC.
15,000,000
Units
and
64,630,000
Shares Common Stock
Wolverine
Exploration Inc. (“Wolverine”) is offering up to
15 million units which as of this date have not been issued. Each
unit consists of one share of common stock in the capital of Wolverine and one
non-transferable share purchase warrant. Each warrant enables the
subscriber to purchase one additional share of common stock at a price of
US$0.15 per warrant for a period of two years from the date the units are
issued.
Additionally,
the selling shareholders named in this prospectus are offering to sell up to
64,630,000 shares of Wolverine’s common stock held by them. Wolverine will not
receive any proceeds from the sale of the shares of common stock being offered
by the selling shareholders. However, Wolverine will pay for the
expenses of this offering and the selling stockholders’ offering, except for any
selling shareholder’s legal or accounting costs or commissions.
Wolverine
is offering a maximum 15 million units on a self underwritten
basis. The offering price is $0.10 per unit. There is no minimum
number of units that Wolverine will sell. All proceeds will be
deposited to Wolverine’s operating account and there will be no refunds. The
offering will be open until (Effective Date + 180 days). There are no
minimum unit purchase requirements for individual investors.
Wolverine
is a startup exploration stage company with no operations.
Wolverine’s
shares of common stock are not quoted on any national securities
exchange. The selling shareholders are required to sell Wolverine’s
shares at $0.10 per share until Wolverine’s shares are quoted on the
Over-the-Counter Bulletin Board (OTCBB), and thereafter at prevailing market
prices or privately negotiated prices.
The
offering made by Wolverine is comprised of shares plus additional warrants for
the same offering price that the named selling shareholders are offering their
shares, but without the additional warrants.
This
investment involves a high degree of risk. See “Risk
Factors” beginning on page 7 for a discussion of certain risk factors and
uncertainties you should carefully consider before making a decision to purchase
any shares of Wolverine’s common stock.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is
truthful or complete. Any representation to the contrary is a
criminal offense.
Page
- 3
Table
of Contents
Page
Prospectus
Summary
5
Risk Factors
7
Use of
Proceeds
9
Determination of Offering
Price
10
Dilution
11
Selling
Shareholders
12
Plan of
Distribution
16
Description of Securities to be
Registered
18
Interests of Named Experts and
Counsel
19
Description of
Business
20
Description of
Property
27
Legal
Proceedings
27
SEC Filings
27
Market for Common Equity and
Related Stock Matters
Management Discussion and
Analysis of Financial Condition
33
Changes in Disagreements With
Accountants on Accounting and Financial Disclosure
38
Directors, Officers, Promoters,
and Control Persons
38
Executive
Compensation
40
Security Ownership of Certain
Beneficial Owners and Management
41
Transactions with Related
Persons, Promoters, and Certain Control Persons
42
Disclosure of Commission
Position of Indemnification for Securities Act
Liabilities
43
You
should rely only on the information contained in this prospectus. Wolverine has
not authorized anyone to provide you with information different from that
contained in this prospectus. Wolverine and the selling stockholders
are offering to sell shares of Wolverine’s common stock and seeking offers to
buy shares of Wolverine’s common stock only in jurisdictions where such offers
and sales are permitted. You should assume that the information
appearing in this prospectus is accurate only as of the date on the front cover
of this prospectus. Wolverine’s business, financial condition,
results of operations and prospects may have changed since that date.
Page
- 4
Prospectus Summary
The
following summary is a shortened version of more detailed information, exhibits
and financial statements appearing elsewhere in this
prospectus. Prospective investors are urged to read this prospectus
in its entirety.
Wolverine
is a startup company in the business of base and precious metal
exploration. There is no assurance that a commercially viable deposit
exists on Wolverine’s mineral claims. Exploration will be required
before a final evaluation as to the economic and legal feasibility of
Wolverine’s mineral claims is determined.
On
February 28, 2007 Wolverine acquired a 90% interest in 516 mineral claims from
Shenin Resources Inc. for the aggregate cost of $374,000.
On May17, 2007, Wolverine acquired an additional six mineral claims from Richard
Haderer for the cost of $321 (CDN$360).
All 522
mineral claims are in the Province of Newfoundland and Labrador in Canada (the
“Labrador
Claims”). The Labrador Claims are located about 120 kilometres
(76 miles) west of Goose Bay, Labrador, which is near the Atlantic Coast in
northern Canada. Infrastructure required for exploration, advanced
exploration and even mining are excellent given the proximity of the property to
Goose Bay, Labrador, which has an international airport and a number of
exploration outfitters.
Wolverine’s
consulting geophysicist has written a report dated May 25, 2007, providing
management with recommendations of how Wolverine should explore the Labrador
Claims. From the work conducted on the Labrador Claims to date, there
is indication of possible gold and copper mineralization, but additional work
needs to be conducted on the Labrador Claims to prove such
mineralization.
Wolverine’s
objective is to conduct exploration activities on the Labrador Claims to assess
whether the property possesses any commercially viable
deposits. Until Wolverine can validate otherwise, the Labrador Claims
are without known reserves. Management is planning a five phase
exploration program to explore the Labrador Claims. Access to the
Labrador Claims is restricted to the period of May to November of each year due
to snow in the area. This means that Wolverine’s exploration
activities are limited to a period of about six to seven months per
year. Wolverine completed Phase One and Phase Two of its exploration
program in October of 2007 and completed Phase 3 of its exploration program in
August 2008. The following table summarizes the next three phases of
Wolverine’s proposed exploration program:
Phase
Number
Planned
Exploration Activities
Time
Table
Four
Excavating,
Surface Trenching and an Induced Polarization Survey
Fall
2008
Five
Drill
Program
Fall
2008
To date
Wolverine has raised $759,400 via offerings completed between April 2006 and
June 2008. The following table summarizes the date of offering, the
price per share paid, the number of shares sold, and the amount raised for these
three offerings.
Wolverine
has no revenues, has achieved losses since inception, has no operations, has
been issued a going concern opinion by its auditor and relies upon the sale of
its shares of common stock to fund its operations.
The
following is a brief summary of this offering.
Securities
being offered to new and current investors:
Up
to a maximum of 15 million units with no minimum purchase. Each
unit consists of one share of common stock and one warrant exercisable at
$0.15 per warrant for a period of two years.
Securities
being offered by selling shareholders:
64,630,000
shares of common stock
(These
shares are being registered by Wolverine for resale on behalf of existing
shareholders.)
Offering
price:
$0.10
(The offering price for Wolverine’s offering includes a share and an
additional warrant whereas the same offering price for the named selling
shareholders only includes a share and not an additional
warrant.)
Offering
period:
The
shares are being offered for a period not to exceed 180 days following the
effective date of this registration statement.
Net
proceeds to Wolverine
(assuming
that all units are sold
and
no warrants exercised):
Up
to a maximum of $1,432,000.
Use
of proceeds:
To
fund exploration work, fund ongoing operations, pay accounts payable, and
to pay for offering expenses.
Number
of shares outstanding before the offering:
68,630,000
Number
of shares outstanding after the offering
(assuming
that all units are sold
and
no warrants exercised):
83,630,000
Summary
Financial Information
The
tables and information below are derived from Wolverine’s audited financial
statements for the years-ended May 31, 2007 and 2008, and the period ended May31, 2006. Wolverine had a working capital deficit of $116.568 and
$105,874 as at May 31, 2008 and May 31, 2007 respectively.
The
book value of Wolverine’s outstanding common stock is $0.01 per share as at May31, 2008.
Page
- 6
Risk Factors
An
investment in the common stock of Wolverine involves a number of very
significant risks. You should carefully consider the following known
material risks and uncertainties in addition to other information in this
prospectus in evaluating Wolverine and its business before purchasing shares of
Wolverine‘s common stock. Wolverine’s business, operating results and
financial condition could be seriously harmed due to any of the following known
material risks. The risks described below are not the only ones
facing Wolverine. Additional risks not presently known to Wolverine
may also impair its business operations. You could lose all or part
of your investment due to any of these risks.
If
Wolverine does not obtain additional financing, the business plan will
fail.
Wolverine’s
current operating funds are insufficient to complete the next phases of its
proposed exploration program on its Labrador mineral
claims. Wolverine will need to obtain additional financing in order
to complete its business plan and its proposed exploration
program. Wolverine’s business plan calls for significant expenses in
connection with the exploration of the Labrador Claims. Wolverine has
not made arrangements to secure any additional financing.
Wolverine’s
failure to make required expenditures could cause us to lose title to the
mineral claim.
Under the
terms of the Vend-In Agreement with Shenin Resources Inc., Wolverine is required
to incur the following expenditures on the claims (i) CDN $150,000 on or before
March 1, 2008; (ii) CDN $200,000 on or before March 1, 2009, and (iii) CDN
$250,000 on or before March 1, 2010; provided that (iv) any excess amount spent
in one year may be carried forward and applied towards fulfillment of the
expenditure required in the later year. As a result of its completion
of Phase One and Phase Two of the proposed exploration program, Wolverine has
met its March 1, 2008 expenditure requirements. However, there is no
assurance that Wolverine can fulfill the other expenditure requirements and may
lose title to the Labrador Claims.
Because
Wolverine has only recently commenced business operations, Wolverine faces a
high risk of business failure and this could result in a total loss of your
investment.
Wolverine
has recently begun the initial stages of exploration of the Labrador Claims, and
thus has no way to evaluate the likelihood whether Wolverine will be able to
operate its business successfully. Wolverine was incorporated on
February 23, 2006 and to date has been involved primarily in organizational
activities, obtaining financing and preliminary exploration of the Labrador
Claims. Wolverine has not earned any revenues and Wolverine has never
achieved profitability as of the date of this prospectus. Potential
investors should be aware of the difficulties normally encountered by new
mineral exploration companies and the high rate of failure of such
enterprises. The likelihood of success must be considered in the
light of problems, expenses, difficulties, complications and delays encountered
in connection with the exploration of the mineral properties that Wolverine
plans to undertake. These potential problems include, but are not
limited to, unanticipated problems relating to exploration and additional costs
and expenses that may exceed current estimates. Wolverine has no
history upon which to base any assumption as to the likelihood that its business
will prove successful, and Wolverine can provide no assurance to investors that
Wolverine will generate any operating revenues or ever achieve profitable
operations. If Wolverine is unsuccessful in addressing these risks
its business will likely fail and you will lose your entire investment in this
offering.
Because
Wolverine has only recently commenced business operations, Wolverine expects to
incur operating losses for the foreseeable future.
Wolverine
has never earned any revenue and Wolverine has never been
profitable. Prior to completing exploration on the Labrador Claims,
Wolverine may incur increased operating expenses without realizing any revenues
from the Labrador Claims, this could cause Wolverine to fail and you will lose
your entire investment in this offering.
If
Wolverine does not find a joint venture partner for the continued development of
its mineral claims, Wolverine may not be able to advance exploration
work.
If the
results of the exploration program are successful, Wolverine may try to enter
into a joint venture agreement with a partner for the further exploration and
possible production of the Labrador Claims. Wolverine would face
competition from other junior mineral resource exploration companies who have
properties that they deem to be attractive in terms of potential return and
investment cost. In addition, if Wolverine entered into a joint
venture agreement, Wolverine would likely assign a percentage of its interest in
the Labrador Claims to the joint venture partner. If Wolverine is
unable to enter into a joint venture agreement with a partner, Wolverine may
fail and you may lose your entire investment in this offering.
Page
- 7
Because
of the speculative nature of mineral property exploration, there is substantial
risk that no commercially viable deposits will be found and the business of
Wolverine will fail.
Exploration
for base and precious metals is a speculative venture involving substantial
risk. Wolverine can provide investors with no assurance that the
Labrador Claims contain commercially viable mineral deposits. The
exploration program that Wolverine will conduct on the Labrador Claims may not
result in the discovery of commercial viable mineral
deposits. Problems such as unusual and unexpected rock formations and
other conditions are involved in base and precious metal exploration and often
result in unsuccessful exploration efforts. In such a case, Wolverine
may be unable to complete its business plan and you could lose your entire
investment in this offering.
Because
of the inherent dangers involved in base and precious metal exploration, there
is a risk that Wolverine may incur liability or damages as Wolverine conducts
its business.
The
search for base and precious metals involves numerous hazards. As a
result, Wolverine may become subject to liability for such hazards, including
pollution, cave-ins and other hazards against which Wolverine cannot insure or
against which Wolverine may elect not to insure. Wolverine currently
has no such insurance nor does Wolverine expect to get such insurance in the
foreseeable future. If a hazard were to occur, the costs of
rectifying the hazard may exceed Wolverine’s asset value and cause Wolverine to
liquidate all of its assets resulting in the loss of your entire investment in
this offering.
Because
access to Wolverine’s mineral claims is often restricted by inclement weather,
Wolverine will be delayed in exploration and any future mining
efforts.
Access to
the Labrador mineral claims is restricted to the period between May and November
of each year due to snow in the area. As a result, any attempts to
visit, test, or explore the property are largely limited to these few months of
the year when weather permits such activities. These limitations can
result in significant delays in exploration efforts, as well as mining and
production in the event that commercial amounts of minerals are
found. Such delays can result in Wolverine’s inability to meet
deadlines for exploration expenditures as defined by the Province of
Newfoundland and Labrador or by the Vend-In Agreement with Shenin Resources
Inc. This could cause the business venture to fail and the loss of
your entire investment in this offering unless Wolverine can meet the
deadlines.
As
Wolverine undertakes exploration of the Labrador Claims, Wolverine will be
subject to compliance with government regulation that may increase the
anticipated time and cost of its exploration program.
There are
several governmental regulations that materially restrict the exploration of
minerals. Wolverine will be subject to the mining laws and
regulations as contained in the Mineral Act of the Province of Newfoundland and
Labrador as Wolverine carries out its exploration program. Wolverine
may be required to obtain work permits, post bonds and perform remediation work
for any physical disturbance to the land in order to comply with these
regulations. While Wolverine’s planned exploration program budgets
for regulatory compliance, there is a risk that new regulations could increase
Wolverine’s time and costs of doing business and prevent Wolverine from carrying
out its exploration program.
Because
market factors in the mining business are out of Wolverine’s control, Wolverine
may not be able to market any minerals that may be found.
The
mining industry, in general, is intensely competitive and we can provide no
assurance to investors even if minerals are discovered that a ready market will
exist from the sale of any base or precious metals found. Numerous
factors beyond Wolverine’s control may affect the marketability of base or
precious metals. These factors include market fluctuations, the
proximity and capacity of natural resource markets and processing equipment,
government regulations, including regulations relating to prices, taxes,
royalties, land tenure, land use, importing and exporting of minerals and
environmental protection. The exact effect of these factors cannot be
accurately predicted, but the combination of these factors may result in
Wolverine not receiving an adequate return on invested capital and you may lose
your entire investment in this offering.
Because
Wolverine holds a significant portion of its cash reserves in United States
dollars, Wolverine may experience weakened purchasing power in Canadian dollar
terms.
Wolverine
holds a significant portion of its cash reserves in United States
dollars. Due to foreign exchange rate fluctuations, the value of
these United States dollar reserves can result in both translation gains or
losses in Canadian dollar terms. If there was to be a significant
decline in the United States dollar versus the Canadian Dollar, Wolverine’s US
dollar purchasing power in Canadian dollars would also significantly
decline. Wolverine has not entered into derivative instruments to
offset the impact of foreign exchange fluctuations.
Wolverine’s
auditors have expressed substantial doubt about Wolverine’s ability to continue
as a going concern.
The
accompanying financial statements have been prepared assuming that Wolverine
will continue as a going concern. As discussed in Note 3 to the
financial statements, Wolverine was recently incorporated on February 23, 2006,
and does not have a history of earnings, and as a result, Wolverine’s auditor
has expressed substantial doubt about the ability of Wolverine to continue as a
going concern. Continued operations are dependent on Wolverine’s
ability to complete equity or debt financings or generate profitable
operations. Such financings may not be available or may not be
available on reasonable terms. Wolverine’s financial statements do
not include any adjustments that may result from the outcome of this
uncertainty.
Page
- 8
There
is no liquidity and no established public market for Wolverine’s common stock
and it may prove impossible to sell your shares.
There is
presently no public market in Wolverine’s shares. While Wolverine
intends to contact an authorized OTC Bulletin Board market maker for sponsorship
of its common stock, Wolverine cannot guarantee that such sponsorship will be
approved nor that Wolverine’s common stock will be listed and quoted for
sale. Even if Wolverine’s shares are quoted for sale, buyers may be
insufficient in numbers to allow for a robust market, and it may prove
impossible to sell your shares.
If
the selling shareholders sell a large number of shares all at once or in blocks,
the value of Wolverine’s shares would most likely decline.
The
selling shareholders are offering 64,630,000 shares of Wolverine’s common stock
through this prospectus. They must sell these shares at a fixed price
of $0.10 until such time as they are quoted on the OTC Bulletin Board or other
quotation system or stock exchange. Wolverine’s common stock is
presently not traded on any market or securities exchange, but should a market
develop, shares sold at a price below the current market price at which the
common stock is trading will cause that market price to
decline. Moreover, the offer or sale of large numbers of shares at
any price may cause the market price to fall. The outstanding shares of common
stock covered by this prospectus represent approximately 94.2% of the common
shares currently outstanding.
Wolverine’s
common stock is subject to the “penny stock” rules of the SEC and the trading
market in Wolverine’s securities is limited, which makes transactions in
Wolverine’s stock cumbersome and may reduce the value of an investment in
Wolverine’s stock.
The
Securities and Exchange Commission has adopted Rule 15g-9 which establishes the
definition of a “penny stock,” for the purposes relevant to Wolverine, as any
equity security that has a market price of less than $5.00 per share or with an
exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless
exempt, the rules require:
·
that
a broker or dealer approve a person’s account for transactions in penny
stocks; and
·
the
broker or dealer receive from the investor a written agreement to the
transaction, setting forth the identity and quantity of the penny stock to
be purchased.
In order
to approve a person’s account for transactions in penny stocks, the broker or
dealer must:
·
obtain
financial information and investment experience objectives of the person;
and
·
make
a reasonable determination that the transactions in penny stocks are
suitable for that person and the person has sufficient knowledge and
experience in financial matters to be capable of evaluating the risks of
transactions in penny stocks.
The
broker or dealer must also deliver, prior to any transaction in a penny stock, a
disclosure schedule prepared by the Commission relating to the penny stock
market, which, in highlight form:
·
sets
forth the basis on which the broker or dealer made the suitability
determination; and
·
that
the broker or dealer received a signed, written agreement from the
investor prior to the transaction.
Generally,
brokers may be less willing to execute transactions in securities subject to the
“penny stock” rules. This may make it more difficult for investors to dispose of
Wolverine’s common stock and cause a decline in the market value of Wolverine’s
common stock.
Disclosure
also has to be made about the risks of investing in penny stocks in both public
offerings and in secondary trading and about the commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in the account and
information on the limited market in penny stocks.
Page
- 9
Use of Proceeds
The
following table indicates the use of proceeds based on the percentage of the
financing that is successfully sold.
Sale
Of
100%
Sale
of
75%
Sale
of
50%
Sale
Of
25%
Gross
Proceeds
$1,500,000
$1,125,000
$750,000
$375,000
Number
of Shares Sold
15,000,000
11,250,000
7,500,000
3,750,000
Less
expenses of offering:
Legal
and Registration Fees
$30,500
$30,500
$30,500
$30,500
Accounting
and Auditing
31,500
31,500
31,500
31,500
Electronic
Filing and Printing
3,000
3,000
3,000
3,000
Transfer
Agent
3,000
3,000
3,000
3,000
Net
Proceeds
$1,432,000
$1,057,000
$682,000
$307,000
Use
of net proceeds
Exploration
of Labrador Claims
$744,050
$744,050
$214,500
$97,500
Payment
of Accounts Payable
$125,000
$125,000
$125,000
$125,000
Working
Capital
$562,950
$187,950
$342,500
$ 84,500
Analysis
of Financing Scenarios
After
deduction $68,000 for estimated offering expenses including legal and
registration fees, accounting and auditing, electronic filing and printing, and
transfer agent, the net proceeds from this offering may be as much as
$1,432,000, assuming all 15 million units are sold. However, there
can be no assurance that any of these shares will be sold. Wolverine
will use the proceeds to fund its next three phases of its proposed exploration
program.
In all
four scenarios Wolverine will complete exploration on its Labrador
Claims. Wolverine will increase its exploration efforts if it is able
to sell a higher percentage of this offering as described in the above
table. The proposed exploration program on the Labrador Claims will
consist of excavating, surface trenching, an induced polarization survey, and a
drill program. See “Description of Business – Plan of Operation”
below for more details. If Wolverine does not sell at least 12% of
this offering Wolverine will not be able to fund the excavation and surface
trenching of Phase Four of its proposed exploration program. If
Wolverine does not sell at least 15% of this offering Wolverine will be not be
able to fund Phase Four of its proposed exploration program.
Determination of Offering
Price
The
offering price has been determined by Wolverine’s board of
directors. The board of directors selected the $0.10 offering price
for both the sale of the shares by the selling shareholders and for the sale of
the units by Wolverine. The offering price was determined by using a
number of factors. Management considered the price of the most recent
financings. Additionally, management estimated the cost of this
offering plus the amount Wolverine needs to operate its business for the next 12
months. Management determined the offering price by assessing
Wolverine’s capital requirements against the price management thinks investors
are willing to pay for Wolverine’s common stock.
The
offering price for the shares to be sold by the selling shareholders was the
last price that the selling shareholders paid for their
shares. Currently there is no market for Wolverine’s common stock and
Wolverine wanted to give its shareholders the ability to sell their shares for a
price equal or greater to the price they paid for their shares. If
Wolverine’s common stock is listed for trading on the OTC Bulletin Board, the
price of the common stock will then be established by the market.
At the
same time, the offering price for the units to be sold by Wolverine was
arbitrarily determined based on Wolverine’s internal assessment of what the
market would support in order for Wolverine to raise $1,500,000 in this
offering. In determining the number of shares to be offered and the
offering price, management took into consideration Wolverine’s cash on hand and
the amount of money Wolverine would need to implement its plan of
operation. Among the factors considered in determining the offering
price were:
·
Wolverine’s
lack of business history;
·
the
proceeds to be raised by the
offering;
·
the
amount of capital to be contributed by investors in this offering in
proportion to the amount of stock to be retained by Wolverine’s existing
shareholders, and;
·
Wolverine’s
relative cash requirements; see “Plan of Distribution” beginning on page
16.
The
offering price for both the shares offered by the selling shareholders and the
units offered by Wolverine does not bear any relationship to Wolverine’s assets,
book value, earnings, or other established criteria for valuing a privately held
company. Accordingly, the offering price should not be considered an
indication of the actual value of the Wolverine’s common stock nor should the
offering price be regarded as an indicator of the future market price of
Wolverine’s common stock.
The
offering made by Wolverine is comprised of shares plus additional warrants for
the same offering price that the named selling shareholders are offering their
shares, but without the additional warrants.
Page
- 10
Dilution
Prior to
this offering, Wolverine had 68,630,000 shares of common stock issued and
outstanding as at May 31, 2008. The net tangible book value of
Wolverine as at May 31, 2008 was $231,653 or $0.003 per share. Net
tangible book value per share is determined by dividing Wolverine’s tangible net
worth, consisting of tangible assets less total liabilities, by the number of
shares outstanding. The average price paid by the present
shareholders is $0.016. The following tables summarize the difference
between the average price paid by present shareholders and the price to be paid
by subscribers to this offering for 25%, 50%, 75% and 100% subscription
rates.
Analysis
for 25% Subscription
Shareholder
Type
Price
Paid
$
Number
of Shares Held
Amount
of Consideration Paid
Percentage
of
Consideration
Percentage
of
Shares
Held
Present
Shareholders
$0.016
68,630,000
$1,099,400
74.6%
94.8%
Investors
in
this
Offering
$0.10
3,750,000
$375,000
25.4%
5.2%
Analysis
for 50% Subscription
Shareholder
Type
Price
Paid
$
Number
of Shares Held
Amount
of Consideration Paid
Percentage
of
Consideration
Percentage
of
Shares
Held
Present
Shareholders
$0.016
68,630,000
$1,099,400
59.4%
90.1%
Investors
in
this
Offering
$0.10
7,500,000
$750,000
40.6%
9.9%
Analysis
for 75% Subscription
Shareholder
Type
Price
Paid
$
Number
of Shares Held
Amount
of Consideration Paid
Percentage
of
Consideration
Percentage
of
Shares
Held
Present
Shareholders
$0.016
68,630,000
$1,099,400
49.4%
85.9%
Investors
in
this
Offering
$0.10
11,250,000
$1,125,000
50.6%
14.1%
Analysis
for 100% Subscription
Shareholder
Type
Price
Paid
$
Number
of Shares Held
Amount
of Consideration Paid
Percentage
of
Consideration
Percentage
of
Shares
Held
Present
Shareholders
$0.016
68,630,000
$1,099,400
42.3%
82.1%
Investors
in
this
Offering
$0.10
15,000,000
$1,500,000
57.7%
17.9%
“Dilution”
means the difference between Wolverine’s public offering price ($0.10 per unit)
and its proforma net tangible book value per share after implementing this
offering and accounting for the cost of the offering. Net tangible
book value per share is determined by dividing Wolverine’s tangible net worth,
consisting of tangible assets less total liabilities, by the number of shares
outstanding. The following table will show the net tangible book
value of Wolverine’s shares both before and after the completion of this
offering for 25%, 50%, 75% and 100% subscription rates.
25%
50%
75%
100%
Public
offering price per unit
$0.10
$0.10
$0.10
$0.10
Net
tangible book value per share before offering
$0.003
$0.003
$0.003
$0.003
Proforma
net tangible book value per share after offering
$0.007
$0.012
$0.016
$0.020
Increase
per share attributable to public investors
$0.004
$0.009
$0.013
$0.017
Dilution
per share to public investors
$0.093
$0.088
$0.084
$0.080
Page
- 11
Selling
Shareholders
The
selling shareholders named in this prospectus are offering all of their
64,630,000 shares of the common stock offered through this
prospectus. These shares were acquired from Wolverine in the
following private placements and acquisition of mineral claims:
1.
27,480,000
shares of Wolverine common stock that the selling shareholders acquired
from Wolverine in offerings that were exempt from registration under
Regulation S of the Securities Act of 1933 and were completed between June13, 2006 and June 25, 2008.
2.
34,000,000
shares of common stock issued on February 28, 2007 to seven non-affiliate
Canadian residents pursuant to a Vend-In Agreement dated February 28, 2007
with Shenin Resources Inc., a non-affiliate Canadian company, at a deemed
price of $0.01 per share for the acquisition of the Labrador mineral
claims.
3.
3,150,000
shares of Wolverine common stock that the selling shareholders acquired
from Wolverine in offerings that were exempt from registration under
Regulation D of the Securities Act of 1933 and were completed between
April 30, 2007 and June 25, 2008.
The
shares of common stock were sold to investors under exemptions provided in
Canada and Regulation S and accredited investors under exemptions provided in
the United States and Regulation D.
Until a
public market is established for Wolverine’s common stock, the selling
shareholders will be offering their shares, which do not include an additional
warrant, at the same offering price as the offering made by Wolverine, which
includes both a share and an additional warrant.
The
following table provides as of the date of this prospectus information regarding
the beneficial ownership of Wolverine’s common stock held by each of the selling
shareholders, including:
1.
the
number of shares owned by each before the
offering;
2.
the
total number of shares that are to be offered for
each;
3.
the
total number of shares that will be owned by each upon completion of the
offering; and
4.
the
percentage owned by each upon completion of the
offering.
Name
of Selling Shareholder
Shares
Owned Before the Offering
Total
Number of Shares to be Offered for the Security Holder’s
Account
Total
Shares Owned After the Offering is Complete
Percentage
of Shares Owned After the Offering is Complete
Mitchell
Adam
300,000
300,000
Nil
Nil
Anchor
Equipment (2005) Ltd. (1)
100,000
100,000
Nil
Nil
H.
Roderick Anderson
1,300,000
1,300,000
Nil
Nil
Margaret
Archibald
100,000
100,000
Nil
Nil
Daryl
M. Auwai
50,000
50,000
Nil
Nil
Balch
Research Corp. (2)
1,850,000
1,850,000
Nil
Nil
Salvatore
Basile
50,000
50,000
Nil
Nil
John
Bevilacqua
200,000
200,000
Nil
Nil
Ralph
Biggar
5,000,000
5,000,000
Nil
Nil
Dr.
J. Andrew Birch
400,000
400,000
Nil
Nil
Mike
Birch
100,000
100,000
Nil
Nil
Birch
Living Trust (3)
2,150,000
2,150,000
Nil
Nil
Tim
Bokenfohr
100,000
100,000
Nil
Nil
Don
Bossert
50,000
50,000
Nil
Nil
Don
Bowins
100,000
100,000
Nil
Nil
Paulo
Branco
300,000
300,000
Nil
Nil
Donald
& Pamela Brewer,
joint
tenants
100,000
100,000
Nil
Nil
Page
- 12
Name
of Selling Shareholder
Shares
Owned Before the Offering
Total
Number of Shares to be Offered for the Security Holder’s
Account
Total
Shares Owned After the Offering is Complete
Percentage
of Shares Owned After the Offering is
Complete
Art
Brown
100,000
100,000
Nil
Nil
J.
Frank Callaghan
100,000
100,000
Nil
Nil
Don
J. Carroll
100,000
100,000
Nil
Nil
Alan
Carter
400,000
400,000
Nil
Nil
Robin
Chandler
250,000
250,000
Nil
Nil
Steve
Chios
100,000
100,000
Nil
Nil
Chuch
Choo
200,000
200,000
Nil
Nil
Clark
David Chul Christie
100,000
100,000
Nil
Nil
David
Christie
100,000
100,000
Nil
Nil
James
Douglas Christie
100,000
100,000
Nil
Nil
Song
Sook Byun Christie
100,000
100,000
Nil
Nil
Randy
Contoli
200,000
200,000
Nil
Nil
Greg
Corcoran
200,000
200,000
Nil
Nil
Angeline
Wong Cordero
100,000
100,000
Nil
Nil
Anriza
Wong Cordero
1,000,000
1,000,000
Nil
Nil
Debbie
Coventry
50,000
50,000
Nil
Nil
Melvin
Crocker
50,000
50,000
Nil
Nil
Crystalwood
Holdings Ltd. (4)
200,000
200,000
Nil
Nil
Joao
DaCosta
300,000
300,000
Nil
Nil
DaCosta
Management Corp. (5)
700,000
700,000
Nil
Nil
Maria
Da Silva
1,000,000
1,000,000
Nil
Nil
Marilyn
Dilgenti-Smith
50,000
50,000
Nil
Nil
James
F. Dixon
100,000
100,000
Nil
Nil
Eva
Dudas
50,000
50,000
Nil
Nil
Art
Den Duyf
5,375,000
5,375,000
Nil
Nil
John
Dyck
100,000
100,000
Nil
Nil
Slade
Dyer
200,000
200,000
Nil
Nil
Keith
Elliot
50,000
50,000
Nil
Nil
Cherie
Federau
450,000
450,000
Nil
Nil
Dennis
& Cindy Federighi,
joint
tenants
100,000
100,000
Nil
Nil
Rick
Finlayson
100,000
100,000
Nil
Nil
Paul
Fong
50,000
50,000
Nil
Nil
Peter
Gommerud
50,000
50,000
Nil
Nil
David
Grandy
300,000
300,000
Nil
Nil
Vincent
Grant Gough
300,000
300,000
Nil
Nil
Feliberto
Gurat
300,000
300,000
Nil
Nil
Allan
Haderer
50,000
50,000
Nil
Nil
Page
- 13
Name
of Selling Shareholder
Shares
Owned Before the Offering
Total
Number of Shares to be Offered for the Security Holder’s
Account
Total
Shares Owned After the Offering is Complete
Percentage
of Shares Owned After the Offering is
Complete
Richard
Haderer
5,250,000
5,250,000
Nil
Nil
Hunter
Henley
50,000
50,000
Nil
Nil
Peter
J. Hoyle
100,000
100,000
Nil
Nil
Stanlie
Hunt
100,000
100,000
Nil
Nil
Peter
Keegan
100,000
100,000
Nil
Nil
Ron
Keegan
50,000
50,000
Nil
Nil
Jack
A. Kleman
100,000
100,000
Nil
Nil
Amin
Ladha
100,000
100,000
Nil
Nil
Laurel
Lee
50,000
50,000
Nil
Nil
Ng
Liang
100,000
100,000
Nil
Nil
Gary
Liu
100,000
100,000
Nil
Nil
Deirdre
Lynch
5,250,000
5,250,000
Nil
Nil
R.
Hector MacKay-Dunn
200,000
200,000
Nil
Nil
Alastair
MacLennan
100,000
100,000
Nil
Nil
Teresa
Mallam
50,000
50,000
Nil
Nil
Joseph
R. Martin
250,000
250,000
Nil
Nil
Terry
Mathers
50,000
50,000
Nil
Nil
Kyle
Stanley McClay
100,000
100,000
Nil
Nil
Stanley
McClay
200,000
200,000
Nil
Nil
Stan
McDonald
100,000
100,000
Nil
Nil
Patrick
McGrath
50,000
50,000
Nil
Nil
Gerald
T. McGuire
100,000
100,000
Nil
Nil
Derrick
McKinnon
100,000
100,000
Nil
Nil
John
McLachlan
100,000
100,000
Nil
Nil
Cindy
Mitchell
250,000
250,000
Nil
Nil
Mario
Morrison
300,000
300,000
Nil
Nil
Robert
R. Morrison
100,000
100,000
Nil
Nil
Dave
Neale
200,000
200,000
Nil
Nil
Deanna
Neale
200,000
200,000
Nil
Nil
Greg
Neale
500,000
500,000
Nil
Nil
Jill
Neale
750,000
750,000
Nil
Nil
Thian
Yew Ng
5,225,000
5,225,000
Nil
Nil
Linda
Nichols
500,000
500,000
Nil
Nil
Neil
Nichols
5,000,000
5,000,000
Nil
Nil
Byron
L. Novosad
400,000
400,000
Nil
Nil
George
Shigeru Okamoto
400,000
400,000
Nil
Nil
Christopher
Thomas Oliver
50,000
50,000
Nil
Nil
Otter
Crique Ventures Limitee (6)
1,000,000
1,000,000
Nil
Nil
Page
- 14
Name
of Selling Shareholder
Shares
Owned Before the Offering
Total
Number of Shares to be Offered for the Security Holder’s
Account
Total
Shares Owned After the Offering is Complete
Percentage
of Shares Owned After the Offering is
Complete
Angelo
S. Paris
100,000
100,000
Nil
Nil
Enrica
Paris
250,000
250,000
Nil
Nil
Franco
Pederzini
100,000
100,000
Nil
Nil
Don
Peterson
400,000
400,000
Nil
Nil
Lawrence
Leroy Pickens and Mary Annette Pickens, joint tenants
50,000
50,000
Nil
Nil
Prote
Poker
5,000,000
5,000,000
Nil
Nil
Dale
B. Pope
200,000
200,000
Nil
Nil
Vincent
and Miriam Puccio 2007 Trust (7)
300,000
300,000
Nil
Nil
Wade
Pugh
200,000
200,000
Nil
Nil
Carla
Radiuk
50,000
50,000
Nil
Nil
Russel
Renneberg
100,000
100,000
Nil
Nil
Anthony
Ricci
1,000,000
1,000,000
Nil
Nil
Patricia
N. Ritchie
100,000
100,000
Nil
Nil
Robert
Ruff
100,000
100,000
Nil
Nil
Bruce
E. Rutherford
50,000
50,000
Nil
Nil
Brent
Shaw
100,000
100,000
Nil
Nil
Chris
Sherry
300,000
300,000
Nil
Nil
Lambros
Siamos
100,000
100,000
Nil
Nil
Signature
Holdings L.L.C. (8)
50,000
50,000
Nil
Nil
Terry
Sklavenitis
200,000
200,000
Nil
Nil
Adam
Strauts
50,000
50,000
Nil
Nil
Daniel
Strauts
50,000
50,000
Nil
Nil
Katherine
Strauts
50,000
50,000
Nil
Nil
Matthew
Strauts
50,000
50,000
Nil
Nil
Dr.
Z. Strauts Inc. (9)
100,000
100,000
Nil
Nil
Douglas
H. Stroyhan
100,000
100,000
Nil
Nil
Michael
Sweeney
100,000
100,000
Nil
Nil
Tequila
Sunset Ltd. (10)
250,000
250,000
Nil
Nil
Derrick
Townsend
200,000
200,000
Nil
Nil
Anreas
Tsonis
100,000
100,000
Nil
Nil
Steve
Van Dalen
300,000
300,000
Nil
Nil
VP
Bank (Switzerland) Ltd. (11)
100,000
100,000
Nil
Nil
Dale
Weeres
180,000
180,000
Nil
Nil
Kelvin
Williams
50,000
50,000
Nil
Nil
Christian
Wirth
500,000
500,000
Nil
Nil
David
Wolfin
100,000
100,000
Nil
Nil
Anthony
Wttewaall
250,000
250,000
Nil
Nil
Page
- 15
Name
of Selling Shareholder
Shares
Owned Before the Offering
Total
Number of Shares to be Offered for the Security Holder’s
Account
Total
Shares Owned After the Offering is Complete
Percentage
of Shares Owned After the Offering is
Complete
1628240
Ontario Inc. (12)
400,000
400,000
Nil
Nil
Total
64,630,000
64,630,000
0
0
(1)
John
Dyck is the beneficial owner of Anchor Equipment (2005)
Ltd.
(2)
Steve
Balch is the beneficial owner of Balch Research
Corp.
(3)
Dennis
Birch is the beneficial owner of Birch Living
Trust.
(4)
Leon
Nowek is the beneficial owner of Crystalwood Holdings
Ltd.
(5)
John
daCosta is the beneficial owner of DaCosta Management
Corp.
(6)
Verlee
Webb is the beneficial owner of Otter Crique Ventures
Limitée.
(7)
Vincent
Puccio and Miriam Puccio are the beneficial owners of the Vincent and
Miriam Puccio 2007 Trust.
(8)
Fred
Avery is the beneficial owner of Signature Holdings
L.L.C.
(9)
Zigart
Strauts is the beneficial owner of Dr. Z. Strauts
Inc.
(10)
Neil
Nichols is the beneficial owner of Tequila Sunset
Ltd.
(11)
Maria
Salviti is the beneficial owner of VP Bank (Switzerland)
Ltd.
(12)
Wally
Boyko is the beneficial owner of 1628240 Ontario
Inc.
Plan of Distribution
This is a
self-underwritten offering. In general Wolverine will have two types
of shares that will be available for distribution:
1.
New
shares related to its Initial Public
Offering.
2.
Non-affiliate
shares owned by selling
shareholders.
New
Shares Related to Wolverine’s Initial Public Offering
Wolverine
will attempt to sell a maximum of 15 million units to the public on a self
underwritten basis. There can be no assurance that any of these units
will be sold. Wolverine’s gross proceeds will be $1,500,000 if all
the units offered are sold. Neither Wolverine nor its President, nor
any other person, will pay commissions or other fees, directly or indirectly, to
any person or firm in connection with solicitation of the sales of the
shares.
The
offering made by Wolverine is comprised of shares plus additional warrants for
the same offering price that the named selling shareholders are offering their
shares, but without the additional warrants.
The
following discussion addresses the material terms of the plan of
distribution.
Wolverine
is offering up to 15 million units at a price of $0.10 per
unit. Since this offering is conducted as a self-underwritten
offering, there can be no assurance that any of the units will be
sold. If Wolverine fails to sell all the units it is trying to sell,
Wolverine’s ability to implement its business plan will be materially affected,
and you may lose all or substantially all of your investment.
There is
currently no market for any of Wolverine’s shares of common stock and little
likelihood that a public market for such securities will develop after the
closing of this offering or be sustained if developed. As such,
investors may not be able to readily dispose of any shares purchased in this
offering.
The legal
opinion with respect to Wolverine’s stock is included as an exhibit to this
registration statement.
Lee
Costerd, Wolverine’s President and sole director, and current shareholders may
purchase securities in this offering upon the same terms and conditions as
public investors. If any purchase by a current shareholder triggered
a material change, Wolverine would promptly file a post effective amendment to
this registration statement. Any of these purchasers would be
purchasing Wolverine’s common stock for investment and not for
resale.
Page
- 16
No broker
or dealer is participating in this offering. If, for some reason,
Wolverine’s sole director or shareholders were to determine that the
participation of a broker or dealer is necessary, this offering will be promptly
amended by a post effective amendment to disclose the details of this
arrangement, including the fact that the broker or dealer is acting as an
underwriter of this offering. This amendment would also detail the
proposed compensation to be paid to any such broker or dealer. The
post effective amendment would also extend an offer of rescission to any
investors who subscribed to this offering before the broker or dealer was
named. In addition to the foregoing requirements; Wolverine would be
required to file any such amendment with the Corporate Finance Department of the
National Association of Securities Dealers, Inc. and to obtain from them a “no
objection” position from that organization on the fairness of the underwriting
compensation.
The
offering will remain open for a period 180 days from the date Wolverine is
legally allowed to commence selling shares based on this prospectus, unless the
entire gross proceeds are earlier received or Wolverine decides, in its sole
discretion, to cease selling efforts.
Non-Affiliate
Shares Owned by Selling Shareholders
The
selling shareholders who currently own 64,630,000 shares of common stock in the
capital of Wolverine may sell some or all of their common stock in one or more
transactions, including block transactions.
The
selling shareholders will sell the shares at $0.10 per share until Wolverine’s
shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market
prices or privately negotiated prices. The offering made by Wolverine
is comprised of shares plus additional warrants for the same offering price that
the named selling shareholders are offering their shares, but without the
additional warrants.
The
shares may also be sold in compliance with the Securities and Exchange
Commission’s Rule 144. A description of the selling limitations
defined by Rule 144 can be located on page 27 of this prospectus.
The
selling shareholders may also sell their shares directly to market makers acting
as principals or brokers or dealers, who may act as agent or acquire the common
stock as a principal. Any broker or dealer participating in such
transactions as agent may receive a commission from the selling shareholders,
or, if they act as agent for the purchaser of such common stock, from such
purchaser. The selling shareholders will likely pay the usual and
customary brokerage fees for such services. Brokers or dealers may agree with
the selling shareholders to sell a specified number of shares at a stipulated
price per share and, to the extent such broker or dealer is unable to do so
acting as agent for the selling shareholders, to purchase, as principal, any
unsold shares at the price required to fulfill the respective broker’s or
dealer’s commitment to the selling shareholders.
Brokers
or dealers who acquire shares as principals may thereafter resell such shares
from time to time in transactions in a market or on an exchange, in negotiated
transactions or otherwise, at market prices prevailing at the time of sale or at
negotiated prices, and in connection with such re-sales may pay or receive
commissions to or from the purchasers of such shares. These
transactions may involve cross and block transactions that may involve sales to
and through other brokers or dealers. If applicable, the selling
shareholders may distribute shares to one or more of their partners who are
unaffiliated with Wolverine. Such partners may, in turn, distribute
such shares as described above. Wolverine can provide no assurance that all or
any of the common stock offered will be sold by the selling
shareholders.
Wolverine
is bearing all costs relating to the registration of the common stock owned by
the selling shareholders. The selling shareholders, however, will pay
any commissions or other fees payable to brokers or dealers in connection with
any sale of the common stock.
The
selling shareholders must comply with the requirements of the Securities Act and
the Securities Exchange Act in the offer and sale of the common
stock. In particular, during such times as the selling shareholders
may be deemed to be engaged in a distribution of the common stock, and therefore
be considered to be an underwriter, they must comply with applicable law and
may, among other things:
·
Not
engage in any stabilization activities in connection with Wolverine’s
common stock;
·
Furnish
each broker or dealer through which common stock may be offered, such
copies of this prospectus, as amended from time to time, as may be
required by such broker or dealer;
and
·
Not
bid for or purchase any of Wolverine’s securities or attempt to induce any
person to purchase any of Wolverine’s securities other than as permitted
under the Securities Exchange Act.
The
Securities Exchange Commission has also adopted rules that regulate
broker-dealer practices in connection with transactions in penny
stocks. Penny stocks are generally equity securities with a price of
less than $5.00 (other than securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume
information with respect to transactions in such securities is provided by the
exchange or system).
The penny
stock rules require a broker-dealer, prior to a transaction in a penny stock not
otherwise exempt from those rules, deliver a standardized risk disclosure
document prepared by the Commission, which:
·
contains
a description of the nature and level of risk in the market for penny
stocks in both public offerings and secondary
trading;
·
contains
a description of the broker’s or dealer’s duties to the customer and of
the rights and remedies available to the customer with respect to a
violation of such duties;
·
contains
a brief, clear, narrative description of a dealer market, including “bid”
and “ask” prices for penny stocks and the significance of the spread
between the bid and ask price;
·
contains
a toll-free telephone number for inquiries on disciplinary
actions;
·
defines
significant terms in the disclosure document or in the conduct of trading
penny stocks; and
·
contains
such other information and is in such form (including language, type,
size, and format) as the Commission shall require by rule or
regulation;
Page
- 17
The
broker-dealer also must provide, prior to proceeding with any transaction in a
penny stock, the customer:
1.
with
bid and offer quotations for the penny
stock;
2.
details
of the compensation of the broker-dealer and its salesperson in the
transaction;
3.
the
number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market
for such stock; and
4.
monthly
account statements showing the market value of each penny stock held in
the customer’s account.
In
addition, the penny stock rules require that prior to a transaction in a penny
stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser’s written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability
statement. These disclosure requirements will have the effect of
reducing the trading activity in the secondary market for Wolverine’s stock
because it will be subject to these penny stock rules. Therefore,
stockholders may have difficulty selling those securities.
Regulation
M
During
such time as Wolverine may be engaged in a distribution of any of the shares
Wolverine is registering by this registration statement, Wolverine is required
to comply with Regulation M. In general, Regulation M precludes any
selling security holder, any affiliated purchasers, and any broker-dealer or
other person who participates in a distribution from bidding for or purchasing,
or attempting to induce any person to bid for or purchase, any security which is
the subject of the distribution until the entire distribution is
complete. Regulation M defines a “distribution” as an offering
of securities that is distinguished from ordinary trading activities by the
magnitude of the offering and the presence of special selling efforts and
selling methods. Regulation M also defines a “distribution participant” as
an underwriter, prospective underwriter, broker, dealer, or other person who has
agreed to participate or who is participating in a distribution.
Regulation
M under the Exchange Act prohibits, with certain exceptions, participants in a
distribution from bidding for or purchasing, for an account in which the
participant has a beneficial interest, any of the securities that are the
subject of the distribution. Regulation M also governs bids and
purchases made in order to stabilize the price of a security in connection with
a distribution of the security. Wolverine has informed the selling
shareholders that the anti-manipulation provisions of Regulation M may apply to
the sales of their shares offered by this prospectus, and Wolverine has also
advised the selling shareholders of the requirements for delivery of this
prospectus in connection with any sales of the common stock offered by this
prospectus.
Description of Securities to be
Registered
General
Wolverine’s
authorized capital stock consists of 200,000,000 shares of common stock at a par
value of $0.001 per share. On February 26, 2007, the authorized
capital was increased from 75 million shares of common stock.
Common
Stock
As at the
date of this prospectus, 68,630,000 shares of common stock are issued and
outstanding and held by 132 shareholders of record. All of this common stock has
been validly issued, is fully paid and is non-assessable.
Holders
of Wolverine’s common stock are entitled to one vote for each share on all
matters submitted to a stockholder vote. Holders of common stock do
not have cumulative voting rights. Therefore, holders of a majority
of the shares of common stock voting for the election of directors can elect all
of the directors. Holders of one-third of shares of common stock
issued and outstanding, represented in person or by proxy, are necessary to
constitute a quorum at any meeting of Wolverine’s stockholders. A
vote by the holders of a majority of Wolverine’s outstanding shares is required
to effectuate certain fundamental corporate changes such as liquidation, merger
or an amendment to Wolverine’s Articles of Incorporation.
Page
- 18
Holders
of common stock are entitled to share in all dividends that the board of
directors, in its discretion, declares from legally available
funds. In the event of a liquidation, dissolution or winding up, each
outstanding share entitles its holder to participate pro rata in all assets that
remain after payment of liabilities and after providing for each class of stock,
if any, having preference over the common stock. Holders of
Wolverine’s common stock have no preemptive rights, no conversion rights and
there are no redemption provisions applicable to Wolverine’s common
stock.
Dividend
Policy
Wolverine
has never declared or paid any cash dividends on its common
stock. Wolverine currently intends to retain future earnings, if any,
to finance the expansion of its business. As a result, Wolverine does
not anticipate paying any cash dividends in the foreseeable future.
Share
Purchase Warrants
As of the
date of this prospectus, there are no outstanding warrants to purchase
Wolverine’s securities. Wolverine may, however, in addition to the
warrants to be issued in this unit offering, issue warrants to purchase its
securities in the future.
Options
As of the
date of this prospectus, there are no options to purchase Wolverine’s
securities. Wolverine may, however, in the future grant such options
and/or establish an incentive stock option plan for its directors, employees and
consultants.
Convertible
Securities
As of the
date of this prospectus, Wolverine has not issued and does not have outstanding
any securities convertible into shares of Wolverine’s common stock or any rights
convertible or exchangeable into shares of Wolverine’s common
stock. Wolverine may, however, issue such convertible or exchangeable
securities in the future.
Nevada
Anti-Takeover Laws
The
provisions of the Nevada Revised Statutes (NRS) sections 78.378 to 78.3793 apply
to any acquisition of a controlling interest in an certain type of Nevada
corporation known as an “Issuing Corporation”, unless the articles of
incorporation or bylaws of the corporation in effect on the 10th day
following the acquisition of a controlling interest by an acquiring person
provide that the provisions of those sections do not apply to the corporation,
or to an acquisition of a controlling interest specifically by types of existing
or future stockholders, whether or not identified.
The
provisions of NRS 78.378 to NRS 78.3793 do not restrict the directors of an
“Issuing Corporation” from taking action to protect the interests of the
corporation and its stockholders, including, but not limited to, adopting or
signing plans, arrangements or instruments that deny rights, privileges, power
or authority to a holders of a specified number of shares or percentage of share
ownership or voting power.
An
“Issuing Corporation” is a corporation organized in the State of Nevada and
which has 200 or more stockholders of record, with at least 100 of who have
addresses in the State of Nevada appearing on the stock ledger of the
corporation and does business in the state of Nevada directly. As
Wolverine currently has less than 200 stockholders and no shareholders in the
State of Nevada the statute does not currently apply to Wolverine.
If
Wolverine does become an “Issuing Corporation” in the future, and the statute
does apply to Wolverine, its sole director Mr. Costerd on his own will have the
ability to adopt any of the above mentioned protection techniques whether or not
he owns a majority of Wolverine’s outstanding common stock, provided he does so
by the specified 10th day
after any acquisition of a controlling interest.
Interests of Named Experts and
Counsel
No expert
or counsel named in this prospectus as having prepared or certified any part of
this prospectus or having given an opinion upon the validity of the securities
being registered or upon other legal matters in connection with the registration
or offering of the common stock was employed on a contingency basis, or had, or
is to receive, in connection with the offering, a substantial interest exceeding
$50,000, directly or indirectly, in the registrant or any of its parents or
subsidiaries. Nor was any such person connected with the registrant
or any of its parents or subsidiaries as a promoter, managing or principal
underwriter, voting trustee, director, officer, or employee.
Conrad C.
Lysiak, Attorney at Law of Spokane, Washington has provided the legal opinion
regarding the legality of the shares being registered.
Page
- 19
The
financial statements included in this prospectus have been audited by Mendoza
Berger and Company, L.L.P., Certified Public Accountants, of Irvine, California
to the extent and for the periods set forth in their report appearing elsewhere
herein, and are included in reliance upon such report given upon the authority
of said firm as experts in auditing and accounting.
The
geological report for the Labrador Claims was prepared by Stephen Balch, B.Sc.,
and the summary information from the geological report disclosed in this
prospectus is in reliance upon the authority and capability of Mr. Balch as a
Professional Geophysicist.
Description of Business
Wolverine
is a mineral exploration company and was incorporated on February 23,2006. Wolverine is a startup company in the business of base and
precious metal exploration.
On
February 28, 2007 Wolverine entered into a Vend-In Agreement with Shenin
Resources Inc. (“Shenin”), a private Canadian
corporation, for the purchase of a 90% interest 516 mineral claims located in
Labrador Canada (the “Shenin
Claims”). The purchase price paid to Shenin was $374,000
satisfied by the issuance of 34,000,000 shares of Wolverine’s common stock at a
deemed price of $0.01 per share and a note payable of $34,000. Under
the terms of the Vend-In Agreement Wolverine is required to incur the following
expenditures on the claims: (i) CDN $150,000 on or before March 1,2008; (ii) CDN $200,000 on or before March 1, 2009, and (iii) CDN $250,000 on or
before March 1, 2010; provided that (iv) any excess amount spent in one year may
be carried forward and applied towards fulfillment of the expenditure required
in the later year. Shenin has also granted Wolverine a first right of
refusal to purchase a 90% interest in all further property in Labrador Canada
that Shenin may obtain an interest in from time to time. See Exhibit
10.1 – Vend-In Agreement for more details.
Also, on
May 17, 2007 Wolverine acquired six mineral claims from Richard Haderer for $321
(CDN$360) (the “Haderer
Claims”), which are contiguous to the Shenin Claims. See
Exhibit 10.3 – Additional Property Agreement for more details.
On August15, 2007, Wolverine extra-provincially registered in the Province of
Newfoundland and Labrador for the purpose of being able to register the Shenin
Claims and the Haderer Claims in the name of Wolverine and for the purpose of
being able to conduct its business in the Province of Newfoundland and
Labrador. See Exhibit 3.4 – Certificate of Registration for more
details.
Location
and Means of Access to the Claims
The
Shenin Claims and the Haderer Claims (collectively, the “Labrador Claims”) are located
about 120 kilometres (75 miles) west of Goose Bay, Labrador, a small town of
9,000 people on the Atlantic Coast of northern Canada. It takes
approximately one and a half to two hours to drive to the Labrador Claims from
Goose Bay.
The
Labrador Claims lie within NTS map sheets 13E/01 and 13F/04 and extends
approximately from 53o 11’ 08’’
N latitude and 62o 11’ 56’’
W longitude to 53o 06’ 34’’
N latitude and 61o 57’ 02’’
W longitude.
Goose Bay
features an international airport. From there, the Labrador Claims
can be accessed directly from the Trans-Labrador Highway. The
Labrador Claims are easily accessible by the Trans-Labrador Highway, which runs
through the central portion of the Labrador Claims. The
Trans-Labrador Highway is a well maintained Provincial Highway with a gravel
surface. There are no gas stations between Goose Bay and Churchill Falls, the
next major community located 290 kilometres (180 miles) to the west of Goose Bay
and 160 kilometres (105 miles) to the west of the Labrador Claims.
Access to
the Labrador Claims is possible for most of the year given the proximity to
Goose Bay and the fact that the highway is well maintained. Airborne
geophysical surveys are best performed either in late winter (March-April) or
during the summer (June-August). Ground geophysical surveys should be
scheduled to avoid freeze-up (November-December) and breakup (late April to
early June). Ground geological surveys are best conducted with no
snow cover (mid June to mid November).
Page
- 20
Figure 1. The Claims are
located approximately 120 kilometres (75 miles) west
of Goose Bay, Labrador.
Description
of Labrador Claims
The
Labrador Claims are unencumbered and in good standing and there are no third
party conditions which affect the Labrador Claims other than conditions defined
by the Province of Newfoundland and Labrador described below. The
Labrador Claims together make up an aggregate area of 33,482
acres. Wolverine has no insurance covering the Labrador
Claims. Management believes that no insurance is necessary since the
Labrador Claims are unimproved and contain no buildings or
improvements. The Labrador Claims cover an area with approximate
dimensions of 20 kilometers east-west (12.5 miles) and 10 kilometers north-south
(6.25 miles).
The
Labrador Claims consist of a total of 522 mineral claims covering five separate
licenses as described in Table 1 below. A layout of the Labrador
Claims is shown in Figure 2 below.
Table
1. Summary of the Claims.
Number
#
of Claims
NTS
Area
(acres)
Good
to Date
013472M
6
13F/04
371
17-05-2012
012427M
20
13E/01
1,235
18-08-2011
012425M
82
13E/01
5,065
18-08-2011
013039M
254
13E/01
& 13F/04
16,927
05-02-2012
013187M
160
13E/01
& 13F/04
9,884
14-03-2012
Page
- 21
- -
Figure 2. The Claims extend
for a distance of approximately 20 kilometers (12.5 miles) along the Trans-Labrador
Highway.
There is
no assurance that a commercially viable mineral deposit exists on the Labrador
Claims. Further exploration will be required before an evaluation as
to the economic feasibility of the Labrador Claims is
determined. Wolverine’s consulting geophysicist has written a report
and provided Wolverine with recommendations of how Wolverine should explore the
Labrador Claims. Until management can validate otherwise, the
Labrador Claims are without known reserves. Management is planning a
five phase exploration program as recommended by its consulting
geophysicist. Wolverine has completed the first two phases of the
exploration program on the Labrador Claims.
Conditions
to Retain Title to the Labrador Claims
The
Labrador Claims have varying expiry dates. In order to maintain the
Labrador Claims in good standing it will be necessary for Wolverine to
coordinate an agent to perform and record valid exploration work with value of
CDN$200 per claim in anniversary year 1, CDN$250 per claim in anniversary year
2, CDN$300 per claim in anniversary year 3, CDN$350 per claim in anniversary
year 4, CDN$400 per claim in anniversary year 5, CDN$600 per claim in
anniversary years six to ten inclusive, CDN$900 per claim in anniversary years
11 to 15 inclusive and CDN$1,200 per claim in anniversary years 16 to 20
inclusive. Failure to perform and record valid exploration work on
the anniversary dates will result in forfeiture of title to the Labrador
Claims.
History
of Labrador and the Labrador Claims
According
to the report prepared by Wolverine’s consulting geophysicist, the geologic
setting is based on information available from the Geological Survey of Canada
(DNR Open File 013F/0055) and the Government of Newfoundland and Labrador (Open
File 013F/0061). The regional geology as described by both Government
Reports contains very little detail because the Trans-Labrador Highway was under
construction during much of the mapping initiative, opening in
1992.
Also, the
area has seen only limited geologic mapping on a regional scale, in part due to
the remoteness of the area and the timing of the Federal and Provincial mapping
initiatives that preceded construction of the Trans-Labrador
Highway. The mapped geology within the area is part of a regional
1:500,000 compilation undertaken by the Newfoundland and Labrador Provincial
Government during the early 1990’s. The survey area is located
outside of the area of detailed mapping, in which case geologic mapping has been
taken from previous publications, most notably a Federal Government regional
mapping program from 1990-1994. During the period 1990 to 1994 the
area was regionally mapped by the Geological Survey of Canada and by the Mines
and Energy Branch of the Newfoundland and Labrador
Government. Geologic mapping was performed on a very regional scale,
due in part to the remoteness of the area (away from the Trans-Labrador Highway)
and the lack of outcrop. In summary there is very little geological
mapping within the survey area and there has never been a detailed mapping
program.
Page
- 22
In 2002
the Labrador Claims were visited by Roderick Mercer on behalf of Tundra
Properties. Mr. Mercer spent several days reviewing mineral showings
along the Trans-Labrador Highway in an attempt to rediscover a mineralized
sub-crop that had been exposed during road construction but later
buried. The sub-crop was described as a gabbro containing pyrite,
chalcopyrite and bornite mineralization. One sample returned 2% Cu
and 0.5 g/t Au. Prospecting by Mr. Mercer did not find any similar
mineralized showings in the area but did uncover several other showings along
the Trans-Labrador Highway that returned significant values for copper when
assayed.
During
the period October 15, 2004 and October 19, 2004 the Labrador Claims were
revisited by Mr. Mercer on behalf of Tundra Properties. During this
re-visit to the Labrador Claims, a trench was blasted to establish the extent of
copper mineralization that had returned high assay values (3.3% Cu) during the
2002 program. Trenches were located in outcrop approximately 100
meters from the roadside mineralization. The trench area was grubbed
off using an excavator. Holes were drilled to a maximum 4 meters
below surface and were loaded with explosives and blasted. In total
three separate areas were excavated and blasted. The trenches were
inspected and sampled with assays returning up to 0.42% Cu. It could
not be determined whether the area sampled was linked to the mineralization
exposed along the roadside.
Mr.
Mercer concluded that the trenching program had failed to prove an extension to
the roadside mineralization. It is also apparent, from reviewing Mr.
Mercer’s Prospecting Report, that the lack of outcrop made it difficult to
advance the prospect through a trenching program.
Present
Condition of the Labrador Claims
The
mineralization found to date on the Labrador Claims consists primarily of copper
and gold mineralization in sulphide with associated pyrite (a non-economic
sulphide mineral). There are also a number of malachite veins (and
malachite stained outcrops).
The
country rocks have been identified as meta-sedimentary
gneiss. Locally gabbros and diorites have been identified by surface
prospecting.
Based on
the mineralization and the known geologic rock types, there appear to be three
possible deposit types that could host mineralization within the Labrador
Claims; 1) porphyry copper-gold in sulphide, 2) volcanogenic (Cu-Pb-Zn) massive
sulphide, or 3) magmatic nickel-copper sulphide.
Copper-gold
(Cu-Au) deposits occur within sedimentary rocks when a stock intrudes into the
sediments and heats up the ground water. The heated fluids pick up
copper and other metals as they percolate through fractures opened up within the
sediments. Mineralization is mostly disseminated, but significant
veins of chalcopyrite, rich in gold, are also present. The presence
of chalcopyrite in meta-sediment and malchite staining are excellent indicators
for a copper-gold system.
VMS
deposits are commonly formed by deposition of hot metals into seawater from
volcanic vents on the seafloor. The main metals include copper, zinc, lead, gold
and silver. Within the Labrador Claims there are no mapped volcanic
rocks, although the known mineralization has been found within gabbro and
diorite.
Magmatic
nickel-copper sulphide deposits are hosted in mafic to ultramafic rocks such as
gabbro, norite, and troctolite. Other rock types commonly associated
with these host rocks are diorites and anorthosites. Within the
Labrador Claims chalcopyrite mineralization was identified in a gabbro and
separately associated with a diorite dyke.
The
Labrador Claims are almost completely covered by overburden and tree
cover. Rock outcrops are best observed along the highway where they
have been uncovered.
The
climate within the area is typically northern with short hot summers and long
cold winters. Winter temperatures can range from -15o C to
-35o
C and occasionally fall to below -42o
C.
There is
no equipment, infrastructure or electricity currently on the Labrador
Claims.
There
have been no previous airborne surveys in this area that are within 35
kilometers (22 miles) of the Labrador Claims. The area would have
been covered as part of the Federal Government regional airborne magnetic
survey, but this survey would not have the sufficient resolution to identify
magnetic units less than 1 kilometer in size and could not detect any conductive
mineralization.
Geology
of the Labrador Claims
Geologically
the area is mapped as early to late Proterozoic meta-sediments that have been
metamorphosed to gneisses. Major gabbroic and anorthositic intrusives
have intruded the gneisses several kilometers to the east and local gabbros and
diorites occur throughout the area along with several quartz
veins. Large tourmaline crystals have also been identified on the
Labrador Claims. The area has little outcrop and is covered by
overburden, generally sand and gravel. Spruces trees are abundant but
are not very tall.
Page
- 23
Limited
prospecting and surface trenching in 2002 and again in 2004 failed to define a
source of the copper mineralization, although additional sub-crop samples were
identified containing some copper and gold values. The presence of
several copper showings and malachite staining in the limited outcrop suggests
that a mineralizing event of copper and gold has intruded into the
meta-sedimentary rocks. The nature of the mineralization is likely to
be copper veins and disseminations with associated gold. It is also
possible that magmatic nickel and copper mineralization could be present with
associated platinum group elements within gabbros.
Plan
of Operation
Exploration
Plan
Wolverine’s
plan of operation for the next 12 months is to complete the following five phase
exploration program within the time periods specified, subject to Wolverine
obtaining the additional funding necessary for the continued exploration of the
Labrador Claims. Currently, Wolverine does not have enough funds to
complete Phase Three or Phase Four or its proposed exploration program in the
spring-summer of 2008. The following is a brief summary of
Wolverine’s five phase exploration program.
1.
Phase
One – This phase of Wolverine’s exploration program was completed in
October 2007 at a cost of $7,012 (CDN$7,500). Phase One
consisted of prospecting, rock sampling, and assaying the rock
samples. As a result of the favorable results from this phase
of the exploration program, management decided to proceed with Phase
Two.
2.
Phase
Two - This phase of Wolverine’s exploration program was completed in
October 2007 at a cost of $187,915 (CDN$$201,000). Phase Two
consisted of an airborne survey of the Labrador Claims. As a
result of the favorable results from this phase of the exploration
program, management has decided to proceed with Phase
Three
3.
Phase
Three – This phase of Wolverine’s exploration program was completed in
August 2008 at no cost to Wolverine. Phase Three consisted of a
ground review, which was completed by members of the Innu Development
Limited Partnership. As a result of favorable results from this
phase of the exploration program, management has decided to proceed with
Phase Four.
4.
Phase
Four will consist of excavating, surface trenching and an induced
polarization survey at a total estimated cost of approximately
US$214,500. The depth of any identified conductors should be
estimated and the priority shallow conductors would be the subject of a
surface trenching program. Such a program could be initiated
during fall of 2008. If the results of Phase Four are
favorable, Wolverine will plan and proceed with Phase Five of the proposed
exploration program.
The
trenches to be excavated will be located on six anomalous areas that were
defined previously in Phase Two by the airborne survey. The number
and locations of trenches to be excavated will be defined by the
geologist. All trench locations will be located in close proximity to
the Trans Labrador Highway (Route 500) near Cache River, 70 to 88 miles (110 to
140 kilometers) west of Goose Bay.
Excavation
of the trenches will be done by an excavator. Once the rock is
exposed, a pressure washer will clean the surface and then the rocks will be
examined and sampled by a geologist. Sampling would ideally be a
continuous linear “v” cut with a rock saw to get a composite
sample. A small, packsack type drill will also be available to get
core samples at depth.
The
exposed bedrock will also be mapped and photographed by the
geologist. Sampling of the linear cuts will be in meter length
sections. The Innu Development Limited Partnership will purchase a
small packsack drill that will be utilized to get core samples at a depth of a
few feet to get below any weathering and into the fresh rock. Core
samples sections will be as directed by the geologist. All samples
will be numbered and packaged and sent to a laboratory for
analysis. All samples will be tested for IPC 30 elements as well as
gold and platinum group elements. All of the samples will be scanned
with a scintillometer for uranium content. The equipment and
personnel required to implement the work will be contracted out of Goose Bay,
the nearest community to the project.
Government
regulations stipulate that all exploration trenches be backfilled as soon as
possible after examination. This will be done prior to demobilization
of the heavy equipment.
5.
Phase
Five will consist of a drill program. Deeper conductors could
be the subject of a Phase Five fall 2008 drill program at a total
estimated cost of $432,500. Areas around the conductors could
be excavated and mapped to determine the likely geologic setting of the
target.
As at May31, 2008, Wolverine had a cash balance of $18,990. Wolverine will
need to raise additional financing to fund Phase Four of the proposed
exploration program to commence in fall 2008 and the Phase Five of the proposed
exploration program to commence in fall of 2008.
Page
- 24
During
the next 12 months, management does not anticipate generating any
revenue. Any additional funding required will come from equity
financing from the sale of Wolverine’s common stock or from the sale of part of
its interest in the Labrador Claims. If Wolverine is successful in
completing an equity financing, existing shareholders will experience dilution
of their interest in Wolverine. Management does not have any
financing arranged and cannot provide investors with any assurance that
Wolverine will be able to raise sufficient funding from the sale of its common
stock to fund the last three phases of its proposed exploration
program. In the absence of such financing, Wolverine’s business will
fail.
Management
may consider entering into a joint venture partnership by linking with a major
resource company to provide the required funding to complete Phase Five of the
proposed exploration program. Management has not undertaken any
efforts to locate a joint venture partner for Phase Five. If
Wolverine enters into a joint venture arrangement, Wolverine will assign a
percentage of its interest in the Labrador Claims to the joint venture
partner.
Based on
the nature of its business, Wolverine anticipates incurring operating losses in
the foreseeable future. Wolverine bases this expectation, in part, on
the fact that very few mineral claims in the exploration stage ultimately
develop into producing, profitable mines. Wolverine’s future financial results
are also uncertain due to a number of factors, some of which are outside its
control. These factors include, but are not limited to:
·
Wolverine’s
ability to raise additional
funding;
·
the
market price for minerals;
·
the
results of the exploration programs on the Labrador Claims;
and
·
Wolverine’s
ability to find joint venture partners for the development of its property
interests.
Due to
Wolverine’s lack of operating history and present inability to generate
revenues, Wolverine’s auditors have stated their opinion that there currently
exists substantial doubt about Wolverine’s ability to continue as a going
concern.
Exploration
Commitments
Also,
under the terms of the Vend-In Agreement Wolverine is required to incur the
following expenditures on the Labrador Claims: (i) CDN $150,000 on or before
March 1, 2008; (ii) CDN $200,000 on or before March 1, 2009, and (iii) CDN
$250,000 on or before March 1, 2010; provided that (iv) any excess amount spent
in one year may be carried forward and applied towards fulfillment of the
expenditure required in the later year. As a result of its completion
of Phase One and Phase Two of the proposed exploration program, Wolverine has
met its March 1, 2008 expenditure requirements. Management expects
that the final two phases of the proposed exploration program will satisfy all
exploration expenditure requirements under the Vend-In Agreement up to March 1,2009.
Transportation
Costs
The
excavating and trenching program in Phase Four will require mobilization from
Goose Bay. The cost of equipment mobilization has been accounted for
in the excavating and trenching cost estimate of
$72,000. Transportation costs will be incurred from time to time from
Goose Bay, Labrador and occasionally from Toronto, Ontario. These
costs are estimated at $11,500 up to but not including the drilling
phase.
During
drilling in Phase Five the drill-core will be transported from the drill-site to
Goose Bay for logging, sample preparation and temporary storage. An
estimated 2,000 metres (6,562 feet) of drill-core will require up to 400 core
boxes. The cost of transporting this core is estimated to be
$7,000.
Equipment
Costs
Trenching
and excavating equipment costs in Phase Four are contained within the estimated
cost of $72,000. There are no expected equipment costs for the
drilling as the cost estimate as provided is an all-in cost (including drill
etc) of $57 per foot.
During
Phase Five, a temporary core logging facility will be required in Goose
Bay. Equipment costs will include purchase of a core saw, laptop
computer, digital camera and manufacturing of core benches and core
racks. The estimated total cost for this is $23,500.
Consumable
Costs
During
the final two phases of the proposed exploration program consumable costs are
expected to be minor other than during drill core and sample
preparation. Estimated cost for consumables during Phase Five is
$3,700.
Page
- 25
Labor
Costs
On-site
supervision will be required for the excavating & trenching in Phase Four
and for the drilling in Phase Five, including core logging, core transportation,
and sample preparation. Excavating & trenching will require a
senior geologist for 21 days at $467 per day ($9,800). Core logging
will require a two prospectors and two labor/samplers for 14 days at CDN$280 per
day each ($15,700). Core transportation and sample preparation will
require a geo-technician for 40 days at CDN$375 per day
($15,000). Total labor costs are estimated to be $40,500 ($25,500 +
$15,000) for the two remaining phases of the proposed exploration
program.
Sample Analysis
Costs
In Phase
Five, selected samples will be sent for assaying over approximate 1 meter
intervals. The assay costs are approximately $185 per sample and
includes transportation. Wolverine estimates it will have 50 samples
to assay from the drill program in Phase Five. The total
estimated cost for sample analysis is $9,300.
Exploration Program
Costs
The costs
described above, which include the ground review, excavating and surface
trenching, drilling, transportation, equipment, consumables, labor, and sample
analysis, make up the entire cost of the final three phases of Wolverine’s
proposed exploration program. All the costs described above are
estimated so management will provide a 15% contingency allowance for
unanticipated and wrongly estimated costs. The table below summarizes
the cost estimate for the final three phases of the proposed exploration
program.
Exploration
Items
Cost
Estimate
US$
Phase
Four - Excavating and Surface Trenching
$72,000
Phase
Four - Induced Polarization Survey
$117,000
Phase
Five - Drill program
$374,000
Phase
Five - Transportation
$7,000
Phase
Five - Equipment
$23,500
Phase
Five - Consumables
$3,700
Phase
Four and Phase Five - Labor
$40,500
Phase
Five - Sample Analysis
$9,300
Contingency
at 15%
$97,050
Total
$744,050
Accounting and Audit
Plan
Wolverine
intends to continue to have its outside consultant assist in the preparation of
Wolverine’s quarterly and annual financial statements and have these financial
statements reviewed or audited by Wolverine’s independent
auditor. Wolverine’s outside consultant is expected to charge
Wolverine approximately $67,500 to prepare Wolverine’s quarterly financial
statements and approximately $22,500 to prepare Wolverine’s annual financial
statements. Wolverine’s independent auditor is expected to charge
approximately $10,000 to review each of Wolverine’s quarterly financial
statements and approximately $15,000 to audit Wolverine’s annual financial
statements. In the next twelve months, Wolverine anticipates spending
approximately $120,000 to pay for its accounting and audit
requirements.
Page
- 26
SEC Filing
Plan
Wolverine
intends to become a reporting company in 2008 after its registration statement
is declared effective. This means that Wolverine will file documents
with the US Securities and Exchange Commission on a quarterly
basis. Wolverine expects to incur filing costs of approximately
$4,000 per quarter to support its quarterly and annual filings. In
the next 12 months, Wolverine anticipates spending approximately $16,000 for
legal costs to pay for three quarterly filings, one annual filing, a 424B4 final
prospectus filing, and a Form 8-A filing in order to complete registration of
Wolverine’s common stock.
Competitive
Conditions
The
mineral exploration business is an extremely competitive
industry. Wolverine is competing with many other mineral exploration
companies. As a junior mineral exploration company, Wolverine
competes with other junior companies for financing and joint venture
partners. Additionally, Wolverine competes for resources such as
professional geologists, camp staff, helicopters and mineral exploration
supplies.
Raw
Materials
The raw
materials for Wolverine’s exploration program will be items including camp
equipment, sample bags, first aid supplies, groceries and
propane. All of these types of materials are readily available in
Goose Bay, Labrador, Canada from a variety of
suppliers. Infrastructure required for exploration, advanced
exploration and even mining are readily available given the proximity of the
Labrador Claims to Goose Bay, which has an international airport and a number of
exploration outfitters and supply stores, open all year round.
Government
Approvals and Regulations
Wolverine
will be required to comply with all regulations defined in the Mineral Act for
the Province of Newfoundland and Labrador. The Act is well defined by
the Province of Newfoundland and Labrador and is available from Wolverine upon
request.
The
effect of these existing regulations on Wolverine’s business is that it is able
to carry out its exploration program as Wolverine has described in this
prospectus. However, it is possible that a future government could
change the regulations that could limit Wolverine’s ability to explore the
Labrador Claims, but management believes this is highly unlikely.
Employees
Wolverine
does not have any employees. Wolverine intends to retain the services
of independent geologists, prospectors and consultants on a contract basis to
conduct the exploration programs on the Labrador Claims.
Description
of Property
Wolverine’s
executive offices are located at 4055 MacLean Road, Quesnel, British Columbia,
Canada, V2J 6V5. Wolverine’s President, Lee Costerd, currently provides this
space to Wolverine free of charge. This space may not be available to Wolverine
free of charge in the future. Wolverine’s administrative office is
located at 1450 Palmerston Avenue, West Vancouver, British Columbia, V7T
1H7. Wolverine is renting the administrative office for $935
(CDN$1,000) per month.
Wolverine
has mineral claims located in central Labrador, Canada as described in the
section “Description of Business”.
Legal
Proceedings
Wolverine
has no legal proceedings that have been or are currently being undertaken for or
against Wolverine nor are any contemplated.
SEC
Filings
This
prospectus and exhibits will be contained in a Form S-1 registration statement
that will be filed with the Securities and Exchange
Commission. Wolverine will become a reporting company after this
registration statement has been declared effective by the Securities and
Exchange Commission (“SEC”). As a
reporting company Wolverine will file quarterly, annual, beneficial ownership
and other reports with the SEC. However, unless Wolverine has the
requisite number of shareholders it is only obliged to report to the SEC for one
year.
Page
- 27
You may
read and copy any materials Wolverine files with the SEC at the SEC’s Public
Reference Room at 100 F Street, N.E., Washington, D.C., 20549. You
may obtain information from the Public Reference Room by calling the SEC at
1-800-SEC-0330. Since Wolverine is an electronic filer, the easiest
way to access its reports is through the SEC’s Internet website that contains
reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC.
Market for Common Equity and Related
Stockholder Matters
Market
Information
There is
presently no public market for Wolverine’s common stock. Wolverine
anticipates applying for trading of its common stock on the Over the Counter
Bulletin Board (OTCBB) upon the effectiveness of the registration statement of
which this prospectus forms a part. However, Wolverine can provide no
assurance that its shares will be traded on the OTCBB or, if traded, that a
public market will materialize.
Wolverine
has no common stock that is subject to outstanding warrants to purchase or
securities that are convertible to Wolverine common stock, with the exception of
the warrants being issued as part of the units in this offering.
As of
August 22, 2008 Wolverine had 68,630,000 shares of its common stock outstanding
of which 64,630,000 shares are owned by non-affiliate shareholders and 4,000,000
shares are owned by Wolverine’s sole Director and Officer who is an
affiliate.
Subject
to the Rule 144 volume limitations and the “shell company” trading restrictions
described in the paragraph below, there are a total of 67,530,000 shares of
Wolverine’s common stock that can be sold pursuant to Rule 144 as
follows:
2,750,000
shares of Wolverine’s common stock owned by 12 non-affiliates since
December 13, 2006.
·
2,150,000
shares of Wolverine’s common stock owned by 20 non-affiliates since July31, 2007.
·
36,600,000
shares of Wolverine’s common stock owned by 17 non-affiliates since August28, 2007.
·
1,600,000
shares of Wolverine’s common stock owned by 10 non-affiliates since
September 30, 2007.
·
4,000,000
shares of Wolverine’s common stock owned by 20 non-affiliates since
October 30, 2007
·
1,100,000
shares of Wolverine’s common stock owned by two non-affiliates since
November 30, 2007.
·
6,890,000
shares of Wolverine’s common stock owned by 25 non-affiliates since
December 30, 2007.
·
2,550,000
shares of Wolverine’s common stock owned by 10 non-affiliates since
January 31, 2008.
·
2,000,000
shares of Wolverine’s common stock owned by eight non-affiliates since
March 7, 2008.
·
2,890,000
shares of Wolverine’s common stock owned by 19 non-affiliates since March8, 2008.
·
1,000,000
shares of Wolverine’s common stock owned by 11 non-affiliates since April5, 2008.
Rule
144 Shares
Subject
to Wolverine’s status as a “shell company” as defined by the SEC and discussed
below, under Rule 144 a shareholder, including an affiliate of Wolverine, may
sell shares of common stock after at least six months have elapsed since such
shares were acquired from Wolverine or an affiliate of
Wolverine. Rule 144 further restricts the number of shares of common
stock which may be sold within any 90 day period to the greater of one percent
of the then outstanding shares of common stock or the average weekly trading
volume in the common stock during the four calendar weeks preceding the date on
which notice of such sale was filed under Rule 144. Certain other
requirements of Rule 144 concerning availability of public information, manner
of sale and notice of sale must also be satisfied. In addition, a shareholder
who is not an affiliate of Wolverine, and who has not been an affiliate of
Wolverine for 90 days prior to the sale, and who has beneficially owned shares
acquired from Wolverine or an affiliate of Wolverine for more than one year may
resell the shares of common stock without compliance with the foregoing
requirements under Rule 144.
If
Wolverine is classified as a “shell company” for having (1) no or nominal
operations and (2) no or nominal assets, then Rule 144 will not be available to
the shareholders of Wolverine and they would not be able to sell their shares
until Wolverine is no longer classified as a “shell company” or the shares are
registered. Shareholders would only be able to rely on Rule 144 and
to sell their shares (a) once the shares are registered or (b) one year after
Wolverine files the required information once it ceases to be a “shell
company”.
Holders
of Wolverine’s Common Stock
As of
August 22, 2008 Wolverine had 132 holders of its common stock.
Equity
Compensation Plans
Wolverine
has no equity compensation program including no stock option plan and none are
planned for the foreseeable future.
Page
- 28
Registration
Rights
Wolverine
has not granted registration rights to the selling shareholders or to any other
person.
Dividends
There are
no restrictions in Wolverine’s articles of incorporation or bylaws that restrict
Wolverine from declaring dividends. The Nevada Revised Statutes,
however, do prohibit Wolverine from declaring dividends where, after giving
effect to the distribution of the dividend:
1.
Wolverine
would not be able to pay its debts as they become due in the usual course
of business; or
2.
Wolverine’s
total assets would be less than the sum of its 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.
Wolverine
has not declared any dividends. Wolverine does not plan to declare
any dividends in the foreseeable future.
We have
audited the accompanying balance sheets of Wolverine Exploration Inc. (an
exploration stage company) as of May 31, 2008 and 2007, and the related
statements of operations, stockholders’ equity and cash flows for the years then
ended and for the period from inception (February 23, 2006) through May 31,2008. These financial statements are the responsibility of the
Company’s management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly, we express no such opinion. An
audit 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 audit provides 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 Wolverine Exploration Inc. as of
May 31, 2008 and 2007, and the results of its operations and its cash flows for
the years then ended and for the period from inception (February 23, 2006)
through May 31, 2008 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 more fully described in Note 3,
the Company has incurred recurring operating losses and has an accumulated
deficit. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern. Management’s plans in regard
to these matters are also described in Note 3. The financial
statements do not include any adjustments to reflect the possible future effects
on the recoverability and classification of assets or the amounts and
classification of liabilities that may result from the outcome of this
uncertainty.
Wolverine
Exploration Inc. (“Wolverine”) was incorporated on February 23, 2006, under
the laws of the State of Nevada. Wolverine’s principal business is the
acquisition and exploration of mineral resources in central Labrador,
Canada. Wolverine has not presently determined whether its properties
contain mineral reserves that are economically recoverable. In these notes,
the terms “Company”, “we”, “us” or “our” mean Wolverine.
Exploration
Stage
These
financial statements and related notes are presented in accordance with
accounting principles generally accepted in the United States of
America. The Company has not produced any revenues from its principal
business and is an exploration stage company as defined by Statement of
Financial Accounting Standard (SFAS) No. 7.
The
Company is in the early exploration stage. In an exploration stage
company, management devotes most of its time to conducting exploratory work and
developing its business. These financial statements have been
prepared on a going concern basis, which implies the Company will continue to
realize its assets and discharge its liabilities in the normal course of
business. The Company has never paid any dividends and is unlikely to
pay dividends or generate earnings in the immediate or foreseeable
future. The Company’s continuation as a going concern and its ability
to emerge from the exploration stage with any planned principal business
activity is dependent upon the continued financial support of its shareholders
and its ability to obtain the necessary equity financing and attain profitable
operations.
Basis
of Presentation
These
audited financial statements and related notes are presented in accordance with
accounting principles generally accepted in the United States.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Reclassifications
Certain
prior period amounts in the accompanying financial statements have been
reclassified to conform to the current year’s presentation. These
reclassifications had no effect on the results of operations or financial
position for any period presented.
Accounting
Estimates
The
preparation of the 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 and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
The
Company’s financial statements are based on a number of estimates, including
accruals for estimated professional fees.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES,
continued
Cash
and Cash Equivalents
For
purposes of the balance sheet and statement of cash flows, the Company considers
all amounts on deposit with financial institutions and highly liquid investments
with maturities of 90 days or less to be cash equivalents. At May 31, 2008
and 2007, the Company did not have any cash equivalents.
Accounts
Receivable
At May31, 2008 and 2007the Company had $6,428 and $0 in goods and services tax
receivable from the Government of Canada.
Financial
Instruments
Foreign Exchange Risk
The
Company is subject to foreign exchange risk for transactions denominated in
foreign currencies. Foreign currency risk arises from the fluctuation
of foreign exchange rates and the degree of volatility of these rates relative
to the United States dollar. The Company does not believe that it has
any material risk due to foreign currency exchange.
Fair
Value of Financial Instruments
The
Company’s financial instruments include cash, accounts receivable, accounts
payable, accrued liabilities and accrued professional fees. The fair
value of these financial instruments approximate their carrying values due to
their short maturities.
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to significant concentrations
of credit risk consist principally of cash deposits. At May 31, 2008
and 2007, the Company had approximately $19,000 and $10,000, respectively in
cash that was not insured. This cash is on deposit with a large
chartered Canadian bank. As part of its cash management process, the
Company performs periodic evaluations of the relative credit standing of this
financial institution. The Company has not experienced any losses in
cash balances and does not believe it is exposed to any significant credit risk
on its cash.
Foreign
Currency Translation
The
Company’s functional and reporting currency is the United States
dollar. Monetary assets and liabilities denominated in foreign
currencies are translated in accordance with SFAS No. 52 Foreign Currency Translation,
using the exchange rate prevailing at the balance sheet date. Gains
and losses arising on settlement of foreign currency denominated transactions or
balances are included in the determination of income. Foreign
currency transactions are primarily undertaken in Canadian
dollars. The Company has not to the date of these financial
statements, entered into derivative instruments to offset the impact of foreign
currency fluctuations.
Comprehensive
Income
Comprehensive
income reflects changes in equity that results from transactions and economic
events from non-owner sources. At May 31, 2008 and 2007, the Company
had $674 and $0 respectively, in accumulated other comprehensive income, from
its foreign currency translation.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES,
continued
Long-lived Assets
At May31, 2008 and 2007, the Company’s only long-lived assets were its mineral
properties. Mineral properties whose costs are individually
significant are assessed individually. Where it is not practicable to
assess individually, such properties may be grouped for an assessment of
impairment. Impairment of mineral properties is estimated based on
primary lease terms, geologic data and average holding periods. The
Company’s mineral properties are evaluated quarterly for the possibility of
potential impairment. The Company has no other long-lived assets and has not
recognized any impairment losses with respect to its mineral
properties. See related disclosures under the caption “Mineral
Property Costs.”
Mineral
Property Costs
The
Company has been in the exploration stage since its inception on February 23,2006 and has not yet realized any revenues from its planned
operations. It is primarily engaged in the acquisition and
exploration of mining properties. Mineral property exploration costs
are expensed as incurred. Mineral property acquisition costs are
initially capitalized when incurred using the guidance in the Emerging Issues
Task Force (EITF) 04-02, Whether Mineral Rights are Tangible
or Intangible Assets. The Company assesses the carrying costs
for impairment under SFAS No. 144, Accounting for Impairment or
Disposal of Long Lived Assets
at each fiscal quarter end. An impairment is recognized when the sum
of the expected undiscounted future cash flows is less than the carrying amount
of the mineral property. Impairment losses, if any, are measured as
the excess of the carrying amount of the mineral property over its estimated
fair value.
When it
has been determined that a mineral property can be economically developed as a
result of establishing proven and probable reserves, the costs then incurred to
develop such property, are capitalized. Such costs will be amortized
using the units-of-production method over the estimated life of the proven and
probable reserves. If mineral properties are subsequently abandoned
or impaired, any capitalized costs will be charged to operations.
Asset
Retirement Obligations
SFAS No.
143 (SFAS 143), Accounting for
Asset Retirement Obligations addresses financial accounting and reporting
for obligations associated with the retirement of tangible long-lived assets and
the associated asset retirement costs. Specifically, SFAS 143
requires that the fair value of a liability for an asset retirement obligation
be recognized in the period in which it is incurred if a reasonable estimate of
fair value can be made. In addition, the asset retirement cost is
capitalized as part of the asset’s carrying value and subsequently allocated to
expense over the asset’s useful life. At May 31, 2008 and 2007, the
Company did not have any asset retirement obligations.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES, continued
Income
Taxes
Income
tax expense is based on pre-tax financial accounting income. Deferred
tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets, including tax loss and credit
carryforwards, and liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date. Deferred income tax expense
represents the change during the period in the deferred tax assets and deferred
tax liabilities. The components of the deferred tax assets and
liabilities are individually classified as current and non-current based on
their characteristics. Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is more likely than not that
some portion or all of the deferred tax assets will not be
realized.
Basic
and Diluted Net Income (Loss) Per Common Share (EPS)
Basic net
loss per share is computed by dividing the net loss attributable to the common
stockholders by the weighted average number of common shares outstanding during
the reporting period. Diluted net income per common share includes
the potential dilution that could occur upon exercise of the options and
warrants to acquire common stock computed using the treasury stock method which
assumes that the increase in the number of shares is reduced by the number of
shares which could have been repurchased by the Company with the proceeds from
the exercise of the options and warrants (which were assumed to have been made
at the average market price of the common shares during the reporting
period).
Potential
common shares are excluded from the diluted loss per share computation in net
loss periods as their inclusion would be anti-dilutive.
At May31, 2008 and 2007, 68,630,000 and 52,300,000 respectively, of the Company’s
common stock was issued or subscribed for. The Company did not have
any options or warrants outstanding.
Stock-Based
Compensation
In
December 2004, the Financial Accounting Standards Board (FASB) issued SFAS No.
123(R), Share-Based
Payment (SFAS 123(R)), which is a revision of SFAS No. 123, Accounting for Stock-Based
Compensation. SFAS 123(R) was effective for public companies
for the first fiscal year beginning after June 15, 2005, supersedes Accounting
Principles Board Opinion No. 25 (APB 25), Accounting for Stock Issued to
Employees, and amends SFAS 95, Statement of Cash
Flows. SFAS 123(R) eliminates the option to use APB 25’s
intrinsic value method of accounting and requires recording expense for stock
compensation based on a fair value based method.
The
adoption of SFAS 123(R) did not have a material effect on the Company’s
financial condition or results of operations.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES, continued
Recent
Accounting Pronouncements
In
February 2006, the Financial Accounting Standards Board (FASB) issued SFAS No.
155 (SFAS 155) Accounting for
Certain Hybrid Financial Instruments - an amendment of FASB Statements No. 133
and 140. This Statement amends FASB Statements No. 133, Accounting for Derivative
Instruments and Hedging Activities, and No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of
Liabilities. This Statement resolves issues addressed in
Statement 133 Implementation Issue No. D1, Application of Statement 133 to
Beneficial Interests in Securitized Financial Assets. This
statement is effective for all financial instruments acquired or issued after
the beginning of an entity’s first fiscal year that begins after September 15,2006. SFAS 156 was effective for the Company beginning June 1,2007. The adoption of SFAS 155 did not have a material impact on our
financial statements.
In March
2006, the FASB issued SFAS No. 156 (SFAS 156), Accounting for Servicing of
Financial Assets – an amendment of FASB Statement No.
140. SFAS 156 amends SFAS No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities, with
respect to accounting for separately recognized servicing assets and servicing
liabilities. SFAS 156 is effective for fiscal years that begin after
September 15, 2006, with early adoption permitted as of the beginning of an
entity’s fiscal year. SFAS 156 was effective for the Company
beginning June 1, 2007. The Company does not have any servicing
assets or servicing liabilities and, accordingly, the adoption of SFAS 156 did
not have a material impact on our financial statements.
In July
2006, the FASB issued FASB Interpretation No. 48 (Interpretation No. 48 or FIN
48), Accounting for
Uncertainty in Income
Taxes. Interpretation No. 48 clarifies the accounting for uncertainty in
income taxes recognized in an enterprise's financial statements in accordance
with SFAS No. 109, Accounting
for Income Taxes. Interpretation No. 48 prescribes a recognition
threshold and measurement attribute for the financial statement recognition and
measurement of a tax position taken or expected to be taken in a tax return.
Interpretation No. 48 also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods, disclosure and
transition. Interpretation No. 48 was effective for the Company beginning
June 1, 2007.
The
Company adopted the provisions of FIN 48 on June 1, 2007. FIN 48 provides
detailed guidance for the financial statement recognition, measurement and
disclosure of uncertain tax positions recognized in the financial statements in
accordance with SFAS 109. Tax positions must meet a “more-likely-than-not”
recognition threshold at the effective date to be recognized upon the adoption
of FIN 48 and in subsequent periods. The adoption of FIN 48 had an
immaterial impact on the Company’s financial position and did not result in
unrecognized tax benefits being recorded. Accordingly, no
corresponding interest or penalties have been accrued. The Company is
required to file income tax returns in the U.S. federal and state
jurisdictions. There are currently no federal or applicable state
income tax examinations underway for these jurisdictions. The Company
does have prior year net operating losses which remain open for
examination.
In
September 2006, the FASB issued Statement of Financial Accounting Standards
(SFAS) No. 157 (SFAS 157), Fair Value Measurements. SFAS
157 defines fair value, establishes a framework for measuring fair value and
enhances disclosures about fair value measures required under other accounting
pronouncements, but does not change existing guidance as to whether or not an
instrument is carried at fair value. SFAS 157 was effective for the Company on
June 1, 2007. The adoption of SFAS 157 did not have a significant
impact on our financial statements.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES, continued
Recent
Accounting Pronouncements, continued
In
September 2006, the FASB issued SFAS 158 (SFAS 158), Employers’ Accounting for Defined
Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements
No. 87, 88, 106, and 132(R). This statement requires an employer to
recognize the over funded or under funded status of a defined benefit
postretirement plan as an asset or liability in its statement of financial
position and to recognize changes in that funded status in the year in which the
changes occur through comprehensive income of a business entity. This
statement also requires an employer to measure the funded status of a plan as of
the date of its year end statement of financial position, with limited
exceptions. The Company will be required to initially recognize the
funded status of a defined benefit postretirement plan and to provide the
required disclosures as of the end of the fiscal year ending after December 15,2006. The requirement to measure plan assets and benefit obligations
as of the date of the employer’s fiscal year end statement of financial position
is effective for fiscal years ending after December 15, 2008, or June 1,2009 for the Company. We do not have a defined benefit postretirement
plan and thus the Adoption of SFAS 158 is not expected to have a material impact
on our financial statements.
In
February 2007, the FASB issued SFAS No. 159 (SFAS 159), The Fair Value Option for Financial
Assets and Financial Liabilities—Including an amendment of FASB Statement No.
115. SFAS 159 permits entities to choose to measure many
financial instruments and certain other items at fair
value. Unrealized gains and losses on items for which the fair value
option has been elected will be recognized in earnings at each subsequent
reporting date. SFAS 157 will be effective for the Company on June 1,2008. The adoption of SFAS 159 is not expected to have a material
impact on our financial statements.
In June
2007, the EITF of the FASB reached a consensus on Issue No. 07-3, Accounting for Nonrefundable Advance
Payments for Goods or Services Received for Use in Future Research and
Development Activities (EITF 07-3). EITF 07-3 requires that
non-refundable advance payments for goods or services that will be used or
rendered for future research and development activities must be deferred and
capitalized. As the related goods are delivered or the services are
performed, or when the goods or services are no longer expected to be provided,
the deferred amounts must be recognized as an expense. This issue is
effective for financial statements issued for fiscal years beginning after
December 15, 2007 and earlier application is not permitted. This
consensus is to be applied prospectively for new contracts entered into on or
after the effective date. EITF 07-03 will be effective for the
Company on June 1, 2008. The pronouncement is not expected to have a
material effect on our financial statements.
In
December 2007, the FASB issued SFAS No. 141(R), Business Combinations (SFAS
141(R)), which replaces SFAS 141, Business
Combinations. SFAS 141(R) requires an acquirer to recognize
the assets acquired, the liabilities assumed, and any non-controlling interest
in the acquiree at the acquisition date, measured at their fair values as of
that date, with limited exceptions. This statement also requires the
acquirer in a business combination achieved in stages to recognize the
identifiable assets and liabilities, as well as the non-controlling interest in
the acquiree, at the full amounts of their fair values. SFAS 141(R) makes
various other amendments to authoritative literature intended to provide
additional guidance or to confirm the guidance in that literature to that
provided in this statement. This statement 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 December15, 2008. SFAS 141(R) will be effective for the Company on June 1,2009. We do not expect the adoption of SFAS 141(R) to have a
significant impact on our financial statements.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES, continued
Recent
Accounting Pronouncements, continued
In
December 2007, the Emerging Issues Task Force (EITF) of the FASB reached a
consensus on Issue No. 07-1, Accounting for Collaborative
Arrangements (EITF 07-1). The EITF concluded on the definition
of a collaborative arrangement and that revenues and costs incurred with third
parties in connection with collaborative arrangements would be presented gross
or net based on the criteria in EITF 99-19 and other accounting
literature. Companies are also required to disclose the nature and
purpose of collaborative arrangements along with the accounting policies and the
classification and amounts of significant financial-statement amounts related to
the arrangements. Activities in the arrangement conducted in a
separate legal entity should be accounted for under other accounting literature;
however, required disclosure under EITF 07-1 applies to the entire collaborative
agreement. This issue is effective for financial statements issued
for fiscal years beginning after December 15, 2008, and interim periods within
those fiscal years, and is to be applied retrospectively to all periods
presented for all collaborative arrangements existing as of the effective date.
EITF 07-1 will be effective for the Company on June 1, 2009. We do
not expect the adoption of EITF 07-1 to have a significant impact on our
financial statements.
In
December 2007, FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements (SFAS 160), which amends Accounting
Research Bulletin No. 51, Consolidated Financial
Statements, to improve the relevance, comparability, and transparency of
the financial information that a reporting entity provides in its consolidated
financial statements. SFAS 160 establishes accounting and reporting
standards that require the ownership interests in subsidiaries not held by the
parent to be clearly identified, labeled and presented in the consolidated
statement of financial position within equity, but separate from the parent’s
equity. This statement also requires the amount of consolidated net
income attributable to the parent and to the non-controlling interest to be
clearly identified and presented on the face of the consolidated statement of
income. Changes in a parent’s ownership interest while the parent
retains its controlling financial interest must be accounted for consistently,
and when a subsidiary is deconsolidated, any retained non-controlling equity
investment in the former subsidiary must be initially measured at fair
value. The gain or loss on the deconsolidation of the subsidiary is
measured using the fair value of any non-controlling equity
investment. The statement also requires entities to provide
sufficient disclosures that clearly identify and distinguish between the
interests of the parent and the interests of the non-controlling
owners. This statement applies prospectively to all entities that
prepare consolidated financial statements and applies prospectively for fiscal
years, and interim periods within those fiscal years, beginning on or after
December 15, 2008. SFAS 160 will be effective for the Company on June1, 2009. We do not expect the adoption of SFAS 160 to have a
significant impact on our financial statements.
In
February 2008 the FASB staff issued Staff Position No. 157-2 (FSP FAS 157-2)
Effective date of FASB
Statement No.157. FSP FAS 157-2 delayed the effective date of
SFAS 157 for non-financial assets and non-financial liabilities, except for
items that are recognized or disclosed at fair value in the financial statements
on a recurring basis. The provisions of FSP FAS 157-2 will be
effective for us on June 1, 2009.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES, continued
Recent
Accounting Pronouncements, continued
In March
2008, the FASB issued SFAS No. 161 (SFAS 161), Disclosures about Derivative
Instruments and Hedging Activities – An Amendment of FASB Statement No. 133
(SFAS 133). This statement is intended to improve financial
reporting of derivative instruments and hedging activities by requiring enhanced
disclosures about (a) how and why an entity uses derivative instruments, (b) how
derivative instruments and related hedged items are accounted for under SFAS 133
and its related interpretations and (c) how derivative instruments and related
hedged items affect an entity’s financial position, financial performance and
cash flows. The provisions of SFAS 161 are effective for fiscal years
beginning after November 15, 2008. SFAS 161 will be effective for the
Company on June 1, 2009. We are currently evaluating the impact that
the adoption of SFAS 161 may have on our financial statement
disclosures.
In May
2008, FASB issued SFAS No. 162 (SFAS 162), The Hierarchy of Generally Accepted
Accounting Principles. SFAS 162 identifies the sources of
accounting principles and the framework for selecting the principles used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy). SFAS 162 is effective 60 days
following the SEC's approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles. The
Company is currently reviewing the effect, if any; the proposed guidance will
have on its financial statements disclosures.
In May
2008, FASB issued SFAS No. 163 (SFAS 163), Accounting for Financial Guarantee
Insurance Contracts—an interpretation of FASB Statement No.
60. Diversity exists in practice in accounting for financial
guarantee insurance contracts by insurance enterprises under FASB Statement No.
60, Accounting and Reporting
by Insurance Enterprises. That diversity results in
inconsistencies in the recognition and measurement of claim liabilities because
of differing views about when a loss has been incurred under FASB Statement No.
5, Accounting for
Contingencies. This Statement requires that an insurance
enterprise recognize a claim liability prior to an event of default (insured
event) when there is evidence that credit deterioration has occurred in an
insured financial obligation. This Statement also clarifies how Statement
60 applies to financial guarantee insurance contracts, including the recognition
and measurement to be used to account for premium revenue and claim liabilities.
Those clarifications will increase comparability in financial reporting of
financial guarantee insurance contracts by insurance enterprises. This
Statement requires expanded disclosures about financial guarantee insurance
contracts. The accounting and disclosure requirements of the Statement
will improve the quality of information provided to users of financial
statements. SFAS 163 will be effective for financial statements
issued for fiscal years beginning after December 15, 2008, and interim periods
within those fiscal years; disclosure requirements in paragraphs 30(g) and 31
are effective for the first period (including interim periods) beginning after
May 23, 2008. We do not expect the adoption of SFAS 163 to have a
significant impact on our financial statements.
These
financial statements have been prepared on a going concern basis, which implies
the Company will continue to realize its assets and discharge its liabilities in
the normal course of business. The Company has not generated any revenues
since inception and has never paid any dividends and is unlikely to pay
dividends or generate earnings in the immediate or foreseeable future. The
continuation of the Company as a going concern is dependent upon the continued
financial support from its shareholders, the ability of the Company to obtain
necessary equity financing to continue operations, and the attainment of
profitable operations. The Company’s ability to achieve and maintain
profitability and positive cash flows is dependent upon its ability to locate
profitable mineral properties, generate revenues from its mineral production and
control production costs. Based upon current plans, the Company
expects to incur operating losses in future periods. At May 31, 2008,
the Company had working capital deficit of $116,568 and had accumulated
losses of $868,421 since inception. These factors raise substantial
doubt regarding the Company’s ability to continue as a going
concern. There is no assurance that the Company will be able to
generate revenues in the future. These financial statements do not
give any effect to any adjustments that would be necessary should the Company be
unable to continue as a going concern and therefore be required to realize its
assets and discharge its liabilities in other than the normal course of business
and at amounts different from those reflected in the accompanying financial
statements.
NOTE
4 - RELATED PARTY TRANSACTIONS
Due
to Related Parties
The
following amounts were due to related parties at May 31, 2008 and
2007:
2008
2007
Due
to a relative of the director (a)
$ -
$ 467
Consulting
fees due to a company controlled by a major shareholder
(b)
-
38,081
Consulting
fees due to a company controlled by a major shareholder
(c)
7,888
59,529
Total
related party payables
$ 7,888
$ 98,077
(a)
During
the years ended May 31, 2008 and 2007, the Company paid or accrued $0 and
$17,257 in consulting fees and $0 and $3,304 in rent respectively, to a
relative of the director.
(b)
During
the years ended May 31, 2008 and 2007, the Company paid or accrued $0 and
$51,229 respectively, in consulting fees to company controlled by a major
shareholder of the Company.
(c)
During
the year ended May 31, 2008 and 2007, the Company paid or accrued $164,692
and $92,500 in consulting fees and $12,002 and $3,739 in rent,
respectively to a company controlled by a major shareholder of the
Company. (Note 7)
(d)
During
the years ended May 31, 2008 and 2007, the Company paid or accrued $28,222
and $12,793 respectively, in consulting fees to its
director. (Note 6)
(e) During
the years ended May 31, 2008 and 2007, the Company paid $0 and $5,128 to a
company controlled by a major shareholder of the
Company.
Note
Payable to Related Party
At May31, 2008 and 2007the Company had a note payable to a company controlled by two
major shareholders in the amount of $0 and $28,414,
respectively. (Note 5)
NOTE
5 – UNPROVED MINERAL PROPERTIES
Vend-In
Agreement
(a)
On
February 27, 2007, the Company entered into a vend-in agreement whereby
they agreed to acquire a 90% interest in four mineral licenses in central
Labrador, Canada, comprised of 516 mineral claims covering an area of
33,111 acres. On March 27, 2007the Company issued a $34,000
promissory note and 34,000,000 in common shares to acquire this 90%
interest. The purchase price included a total of $26,100 in
refundable staking security deposits. These deposits were
refunded to the Company in February 2008. (Notes 4, 6 and
7)
Under the
terms of the vend-in agreement, the Company is committed to spend approximately
$151,000 (CDN$150,000) on or before March 1, 2008 (spent), $201,000
(CDN$200,000) on or before March 1, 2009, and $251,000 (CDN$250,000) on or
before March 1, 2010 with the provision that any excess amount spent in one year
may be carried forward and applied towards fulfilment of the expenditure
requirements of a later year.
(b)
On
May 17, 2007, the Company purchased a 90% interest in one mineral license
in central Labrador, Canada, comprised of 6 claims covering an area of 371
acres for cash of $362
(CDN$360).
Mineral
Exploration Licenses
The
mineral exploration licenses on the Companies properties are for a term of five
years commencing at various dates from August 18, 2006 to May 17,2007. These licenses may be renewed every five years for up to a
maximum of twenty years provided annual assessment work is completed and
reported, and license renewal fees of $35 (CDN$35), $50 (CDN$50) and $101
(CDN$100) per claim are paid after five, ten and fifteen years respectively. In
order to maintain the property in good standing the Company is required to spend
from $201 (CDN$200) per claim in the first year to $1,207 (CDN$1,200) per claim
in the twentieth year. (Note 7)
At May31, 2008, the Company had spent $239,124 (CDN$ 237,020) on qualified exploration
and development expenditures. These expenditures also qualify as
exploration expenditures under the terms of the Company’s mineral exploration
license and vend-in agreement.
The
Company’s mineral properties are evaluated quarterly for the possibility of
potential impairment. At May 31, 2008, no impairment charges were
recorded against our mineral properties.
On April3, 2006, the Company issued 4,000,000 common shares at $0.001 per share for cash
of $4,000 to its Director. (Note 4)
On June13, 2006the Company issued 2,750,000 common shares at $0.01 per share by way of
private placements for cash of $27,500.
During
April and May 2006, 850,000 of the Company’s common shares were subscribed for
at $0.01 per share for cash of $8,500. Subsequent to May 31, 2006,
these share subscriptions were cancelled and the $8,500 was refunded to the
subscribers.
On
January 31, 2007the Company issued 2,150,000 common shares at $0.01 per share
by way of private placements for total proceeds of $21,500.
On
February 26, 2007, the Company increased their authorized shares of common stock
from 75,000,000 to 200,000,000.
On
February 28, 2007the Company issued 2,600,000 common shares at $0.01 per share
by way of private placements for cash of $26,000.
On
February 28, 2007the Company issued 34,000,000 common shares at a deemed fair
value of $340,000 or $0.01 per share in partial payment for a 90% interest in
mineral licences. (Note 5)
On March30, 2007the Company issued 1,600,000 common shares at $0.01 per share by way of
private placements for cash of $16,000.
On April30, 2007the Company issued 4,000,000 common shares at $0.01 per share by way of
private placements for cash of $40,000.
On May31, 2007the Company issued 1,100,000 common shares at $0.01 per share by way of
private placements for cash of $11,000.
On June30, 2007the Company issued 6,890,000 common shares at $0.01 per share by way of
private placements for cash of $68,900.
On July31, 2007the Company issued 2,550,000 common shares at $0.01 per share by way of
private placements for cash of $25,500.
On
September 7, 2007the Company issued 2,000,000 common shares at $0.01 per share
by way of private placements for cash of $20,000.
On
September 8, 2007the Company issued 2,890,000 common shares at $0.10 per share
by way of private placements for cash of $289,000.
On
October 5, 2007the Company issued 1,000,000 common shares at $0.10 per share by
way of private placements for cash of $100,000.
On March30, 2007, 100,000 of the Company’s common shares were subscribed for at $0.01
per share for cash of $1,000. On November 2, 2007, these share
subscriptions were cancelled and the $1,000 refunded to the
subscriber.
Between
February and May 2008, 1,100,000 common shares were subscribed for at $0.10 per
share by way of private placement for cash of $110,000. (Note 9)
Under the
terms of the vend-in agreement and the mineral exploration licenses the Company
is required to spend the following minimum amounts on exploration:
Future
minimum payments
Vend-in
Agreement
Mineral
Exploration Expenditures*
Mineral
Exploration Licences
2009
$ 128,480
$ -
$ -
2010
251,450
-
-
2011
-
-
-
2012
-
184,347
18,376
2013
-
315,017
-
After
2013
-
6,772,856
78,754
Total
future minimum payments
$ 379,930
$ 7,272,220
$ 97,130
*Minimum
expenditures required under the terms of the vend-in agreement also qualify as
minimum exploration expenditures under the terms of the license
agreements. (Note 5)
Consulting
Commitment
On
January 31, 2007, the Company entered into a consulting agreement with a company
controlled by a major shareholder. Under the terms of the contractthe Company has agreed to pay $10,000 per month for three years and one month
commencing on February 1, 2007. The contract automatically renews
after one year and can be cancelled at anytime, upon agreement by both
parties. At May 31, 2008, the Company has the following future
obligations under this contract:
Income
tax expense has not been recognized for the period from February 23, 2006
(inception) to May 31, 2008 and no taxes were payable at May 31, 2008, because
the Company has incurred net operating losses (“NOL’s”) since its
inception.
The
Company’s operating losses for the years ended May 31, 2008 and 2007,
were:
2008
2007
$
623,768
$
224,926
At May31, 2008 and 2007the Company had the following deferred tax assets related to
NOL’s. A 100%
valuation allowance has been established as management believes it is more
likely than not that the deferred tax assets will not be realized.
2007
2006
Federal
loss carryforwards
$ 301,501
$ 83,182
Less:
valuation allowance
(301,501)
(83,182)
$ -
$ -
The
Company’s valuation allowance increased during 2008 and 2007 by $218,319 and
$76,475, respectively.
The
Company had the following NOL carryforwards at May 31:
2008
2007
$
868,421
$
244,653
The
federal NOL’s expire through May 31, 2028. The Company is a Nevada
corporation and is not subject to state taxes.
NOTE
9 – SUBSEQUENT EVENTS
In June
2008, the Company issued 1,100,000 shares. (Note 6)
F
- 17
Management’s Discussion and Analysis of
Financial Condition
General
This
discussion should be read in conjunction with the May 31, 2008 audited financial
statements, the notes, and the tables included elsewhere in this registration
statement. Management’s discussion and analysis contains
forward-looking statements that are provided to assist in the understanding of
anticipated future performance. However, future performance involves
risks and uncertainties that may cause actual results to differ materially from
those expressed in the forward-looking statements. See
“Forward-looking Statements” below for more details.
Wolverine’s
principal business is the acquisition and exploration of base and precious metal
mineral properties. Wolverine is focused on exploration of the
Labrador Claims. Wolverine has not presently determined whether the
Labrador Claims contain mineral reserves that are economically
recoverable. Wolverine has not commenced significant operations and
is considered an Exploration Stage Company, as defined by Statement of Financial
Accounting Standard (“SFAS”) No.7 Accounting and Reporting by
Development Stage Enterprises.
Critical
Accounting Policies and Estimates
An
appreciation of Wolverine’s critical accounting policies is necessary to
understand its financial results. These policies may require that
Wolverine to make difficult and subjective judgments regarding uncertainties; as
a result, the estimates may significantly impact its financial
results. The precision of these estimates and the likelihood of
future changes depend on a number of underlying variables and a range of
possible outcomes. Other than its accounting for mineral property
costs, Wolverine’s critical accounting policies do not involve the choice
between alternative methods of accounting. Wolverine has applied its
critical accounting policies and estimation methods consistently.
Financial
Instruments
Concentration
of Credit Risk
Financial
instruments that potentially subject Wolverine to significant concentrations of
credit risk consist principally of cash.
At May31, 2008, Wolverine had approximately $19,000 in cash that was not
insured. Wolverine’s cash is on deposit with a major chartered
Canadian bank. As part of Wolverine’s cash management process,
management performs periodic evaluations of the relative credit standing of
these financial institutions. Wolverine has not suffered any losses
of cash and management does not believe that Wolverine’s cash is exposed to any
significant credit risk.
Revenue
Recognition
Wolverine
will record revenues from the sale of minerals when pervasive evidence of an
arrangement exists, delivery to the customer has occurred, risk of ownership or
title has transferred, and collectibility is reasonably assured.
Interest
income is recognized at the end of each month.
Unproved
Mineral Property Costs and Exploration and Development Costs
Wolverine
has been in the exploration stage since inception on February 23, 2006 and has
not yet realized any revenues from its operations. Wolverine is
primarily engaged in the acquisition and exploration of mineral exploration
properties. Wolverine expenses mineral property exploration costs as
they are incurred. Mineral property acquisition costs are initially
capitalized, when incurred, using the guidance in the Emerging Issues Task Force
(“EITF”) 04-02, whether
Mineral Rights are Tangible or Intangible Assets. Wolverine assesses
the carrying costs for impairment under SFAS No. 144, Accounting for Impairment or
Disposal of Long Lived Assets at each fiscal quarter end. An
impairment is recognized when the sum of the expected undiscounted future cash
flows is less than the carrying amount of the mineral
property. Impairment losses, if any, are measured as the excess of
the carrying amount of the mineral property over its estimated fair
value. During the year ended May 31, 2008, Wolverine did not have any
mineral property acquisition costs.
When it
has been determined that a mineral property can be economically developed as a
result of establishing proven and probable reserves, the costs then incurred to
develop such property, are capitalized. Such costs will be amortized
using the units-of-production method over the estimated life of the proven and
probable reserves. If mineral properties are subsequently abandoned
or impaired, any capitalized costs will be charged to operations.
Long-Lived
Assets
Wolverine
accounts for long-lived assets under SFAS Nos. 142 and 144, Accounting for Goodwill and Other
Intangible Assets” and “Accounting for Impairment or
Disposal of Long-Lived Assets. In accordance with SFAS 142 and
144, Wolverine reviews its long-lived assets for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. Wolverine recognizes impairment when the sum of the
expected undiscounted future cash flows is less than the carrying amount of the
asset. Impairment losses, if any, are measured as the excess of the
carrying amount of the asset over its estimated fair
value. Wolverine’s only long-lived assets are its unproven mineral
interests in the Labrador Claims. At May 31, 2008, Wolverine had no
impairment losses with respect to its unproven mineral interests.
Page
- 48
Asset
Retirement Obligations
Wolverine
will record the fair value of an asset retirement obligation as a liability in
the period in which it incurs a legal obligation associated with the retirement
of tangible long-lived assets that result from the acquisition, construction,
development, or normal use of its long-lived assets. Wolverine will
record a corresponding asset and will amortize it over the life of the
asset. Wolverine will adjust the obligation at the end of each period
to reflect the passage of time (accretion expense) and changes in the estimated
future cash flows underlying the obligation (asset retirement
cost). At May 31, 2008 Wolverine had no asset retirement
obligations.
Recent
Accounting Pronouncements
In
February 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 155
(“SFAS 155”) Accounting for Certain Hybrid
Financial Instruments - an amendment of FASB Statements No. 133 and
140. This Statement amends FASB Statements No. 133, Accounting for Derivative
Instruments and Hedging Activities, and No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of
Liabilities. This Statement resolves issues addressed in
Statement 133 Implementation Issue No. D1, Application of Statement 133 to
Beneficial Interests in Securitized Financial Assets. This
statement is effective for all financial instruments acquired or issued after
the beginning of an entity’s first fiscal year that begins after September 15,2006. SFAS 156 was effective for Wolverine beginning June 1,2007. The adoption of SFAS 155 did not have a material impact on
Wolverine’s financial statements.
In March
2006, the FASB issued SFAS No. 156 (“SFAS 156”), Accounting for Servicing of
Financial Assets – an amendment of FASB Statement No.
140. SFAS 156 amends SFAS No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishment of Liabilities, with
respect to accounting for separately recognized servicing assets and servicing
liabilities. SFAS 156 is effective for fiscal years that begin after
September 15, 2006, with early adoption permitted as of the beginning of an
entity’s fiscal year. SFAS 156 was effective for Wolverine beginning
June 1, 2007. Wolverine does not have any servicing assets or
servicing liabilities and, accordingly, the adoption of SFAS 156 did not have a
material impact on its financial statements.
In July
2006, the FASB issued FASB Interpretation No. 48 (“Interpretation No. 48” or
“FIN 48”), Accounting for Uncertainty
in Income
Taxes. Interpretation No. 48 clarifies the accounting for
uncertainty in income taxes recognized in an enterprise's financial statements
in accordance with SFAS No. 109, Accounting for Income Taxes.
Interpretation No. 48 prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax
return. Interpretation No. 48 also provides guidance on
derecognition, classification, interest and penalties, accounting in interim
periods, disclosure and transition. Interpretation No. 48 was
effective for Wolverine beginning June 1, 2007.
Wolverine
adopted the provisions of FIN 48 on June 1, 2007. FIN 48 provides
detailed guidance for the financial statement recognition, measurement and
disclosure of uncertain tax positions recognized in the financial statements in
accordance with SFAS 109. Tax positions must meet a
“more-likely-than-not” recognition threshold at the effective date to be
recognized upon the adoption of FIN 48 and in subsequent periods. The
adoption of FIN 48 had an immaterial impact on Wolverine’s financial position
and did not result in unrecognized tax benefits being
recorded. Accordingly, no corresponding interest or penalties have
been accrued. Wolverine is required to file income tax returns in the
U.S. federal and state jurisdictions. There are currently no federal
or applicable state income tax examinations underway for these
jurisdictions. Wolverine does have prior year net operating losses
that remain open for examination.
In
September 2006, FASB issued SFAS No. 157, Fair Value
Measurements. SFAS No. 157 defines fair value, establishes a
framework for measuring fair value and enhances disclosures about fair value
measures required under other accounting pronouncements, but does not change
existing guidance as to whether or not an instrument is carried at fair
value. The adoption of SFAS 157 did not have a material impact on
Wolverine’s financial statements.
In
February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial
Assets and Financial Liabilities - including an amendment of
SFAS No. 115, Accounting for
Certain Investments in Debt and Equity Securities, which applies to all
entities with available-for-sale and trading securities. This
statement permits entities to choose to measure many financial instruments and
certain other items at fair value. The objective is to improve
financial reporting by providing entities with the opportunity to mitigate
volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions. This statement is effective as of the beginning of an
entity’s first fiscal year that begins after November 15, 2007. Early
adoption is permitted as of the beginning of a fiscal year that begins on or
before November 15, 2007, provided the entity also elects to apply the
provisions of FASB Statement No. 157, Fair Value
Measurements. Wolverine does not expect the adoption of SFAS
159 to have a material impact on its financial statements as Wolverine did not
elect the fair value option for any of its financial assets or
liabilities.
In June
2007, the EITF of the FASB reached a consensus on Issue No. 07-3, Accounting for
Nonrefundable Advance Payments for Goods or Services Received for Use in Future
Research and Development Activities (“EITF 07-3”). EITF
07-3 requires that non-refundable advance payments for goods or services that
will be used or rendered for future research and development activities must be
deferred and capitalized. As the related goods are delivered or the
services are performed, or when the goods or services are no longer expected to
be provided, the deferred amounts must be recognized as an
expense. This issue is effective for financial statements issued for
fiscal years beginning after December 15, 2007 and earlier application is not
permitted. This consensus is to be applied prospectively for new
contracts entered into on or after the effective date. Wolverine does
not expect the adoption of EITF 07-03 to have a material effect on its unaudited
financial statements.
Page
- 49
In
February 2008 the FASB staff issued Staff Position No. 157-2 (“FSP FAS 157-2”) Effective date of FASB Statement
No.157. FSP FAS 157-2 delayed the effective date of SFAS 157
for non-financial assets and non-financial liabilities, except for items that
are recognized or disclosed at fair value in the financial statements on a
recurring basis. The provisions of FSP FAS 157-2 will be effective
for Wolverine on June 1, 2009.
In March
2008, the FASB issued SFAS No. 161 (“SFAS 161”), Disclosures about Derivative
Instruments and Hedging Activities – An Amendment of FASB Statement No.
133 (“SFAS
133”). This
statement is intended to improve financial reporting of derivative instruments
and hedging activities by requiring enhanced disclosures about (a) how and why
an entity uses derivative instruments, (b) how derivative instruments and
related hedged items are accounted for under SFAS 133 and its related
interpretations and (c) how derivative instruments and related hedged items
affect an entity’s financial position, financial performance and cash flows.
The provisions of SFAS 161 are effective for fiscal years beginning after
November 15, 2008. SFAS 161 will be effective for Wolverine on June1, 2009. Wolverine is currently evaluating the impact adoption of
SFAS 161 may have on its financial statement disclosures.
Foreign
Currency Translation
Wolverine’s
functional and reporting currency is the United States
dollar. Wolverine determined that its functional currency is the
United States dollar for the following reasons:
·
Wolverine’s
current and future financings are and will be in United States
dollars;
·
Wolverine
maintains cash holdings primarily in United States
dollars;
·
Any
potential sales of minerals recovered from the Labrador Claims will be
undertaken in United States
dollars;
·
Wolverine’s
administrative expenses are undertaken in United States
dollars;
·
All
of Wolverine’s cash flows are generated in United States dollars;
and
·
Even
though the Labrador Claims are located in Canada, and the exploration
expenses are usually billed in Canadian dollars, Wolverine can request
that these expenses be billed in United States
dollars
Monetary
assets and liabilities denominated in foreign currencies are translated in
accordance with SFAS No. 53 Foreign Currency Translation,
using the exchange rate prevailing at the balance sheet date. Gains
and losses arising on settlement of foreign currency denominated transactions or
balances are included in the determination of income. Foreign
currency transactions are primarily undertaken in Canadian
dollars. Wolverine has not to the date of these financial statements,
entered into derivative instruments to offset the impact of foreign currency
fluctuations.
Related
Party Transactions
Texada
Consulting Inc. (Texada), a company controlled by a major shareholder, provides
consulting services to Wolverine. Texada is paid a fee of $10,000 per
month plus expenses and rent.
Wolverine’s
president and sole director, Lee Costerd, is paid a consulting fee of $2,500 per
month, but is not a salaried employee.
During
the fiscal year ended May 31, 2008 related parties billed $192,914 in consulting
fees and $12,002 in office rent. In relation to these fees, Wolverine
was indebted to Texada in the amount of $7,888 at May 31, 2008. The
amount due to Texada does not bear interest or have any fixed terms of
repayment.
Wolverine
does not have any loans or advances payable to its president and sole director,
Mr. Costerd.
Net Loss. During
the year ended May 31, 2007, Wolverine had a net loss of $623,768 or $0.01 per
share, which is an increase of $398,842 from its net loss of $224,926 or $0.01
per share for the year ended May 31, 2008. The increase in
Wolverine’s loss was primarily due to increases in administrative expenses,
advertising and promotion expenses, exploration and development costs, and
professional fees.
Revenue. Wolverine
had no operating revenues since its inception on February 23, 2006, through to
May 31, 2008. Wolverine’s activities have been financed from the
proceeds of share subscriptions.
Page
- 50
Operating
Expenses. Wolverine’s operating expenses increased by $398,842
from $224,926 for the year ended May 31, 2007, to $623,768 for the year ended
May 31, 2008. The increase was primarily due to the exploration of
the Labrador Claims and the general increase in activity as Wolverine
established its business plan and prepared this registration
statement. Approximate increases were incurred of $208,000 in
exploration and development costs due to preliminary exploration on Wolverine’s
properties, $90,000 in professional fees due to accounting and legal services,
and $82,000 in administrative expenses for the operation of
Wolverine.
Liquidity,
Capital Resources and Financial Position
Liquidity
is the ability of a company to generate funds to support its current and future
operations, satisfy its obligations, and otherwise operate on an ongoing
basis At May 31, 2008, Wolverine had a cash balance of $18,990 and
negative cash flows from operations of $576,036 for the year ended May 31,2008.
For the
year ended May 31, 2008 Wolverine funded its operation through the issuance or
subscription of $503,400 in common stock. From its inception, on
February 23, 2006 to May 31, 2008 Wolverine raised a total of $649,400 from
private offerings of its common stock. Since June 1, 2008 Wolverine
has raised an additional $110,000 from private offerings of its common
stock.
The notes
to Wolverine’s unaudited financial statements as of May 31, 2008, disclose its
uncertain ability to continue as a going concern. Wolverine has not
and does not expect to generate any revenues to cover its expenses while it is
in the exploration stage and as a result Wolverine has accumulated a deficit of
$868,421 since inception. As of May 31, 2008, Wolverine had $141,986
in current liabilities. When its current liabilities are offset
against its current assets of $25,418 Wolverine is left with a negative working
capital of $116,568. While Wolverine has successfully generated
sufficient working capital through the sale of common stock to the date of this
filing and management believes that Wolverine can continue to do so for the next
year, there are no assurances that Wolverine will succeed in generating
sufficient working capital through the sale of common stock to meet its ongoing
cash needs.
Net Cash Used In
Operating Activities. Net cash used in
operating activities during the year ended May 31, 2008, was
$576,036. This amount was made up of $623,768 to cover operating
costs, an increase of $6,428 in accounts receivable and a decrease of $90,189 in
due to related parties. These uses of cash were offset by a decrease
in prepaid expenses and deposit of $27,674, increases of $66,600 in accounts
payable, $48,075 in accrued professional fees and $2,000 in accrued
liabilities.
Net Cash Used in
Investing Activities. Wolverine did not
have any investing activities during the year ended May 31, 2008.
Net Cash Provided
By Financing Activities. During the year ended May 31, 2008
Wolverine issued $613,400 in common stock and had a further $110,000 in common
stock subscriptions. This was offset by the rejection and return of
subscription funds in the amount of $1,000 and the payment of $28,414 on a note
payable to a related party.
Off-balance
sheet arrangements
Wolverine
has no off-balance sheet arrangements including arrangements that would affect
its liquidity, capital resources, market risk support and credit risk support or
other benefits. Wolverine does not have any non-consolidated,
special-purpose entities.
Wolverine
had the following long term commitments at May 31, 2008:
·
On
January 31, 2007 Wolverine entered into a consulting agreement with Texada
Consulting Inc. The contract is for a period of three years and
one month ending on February 28, 2010. Under the terms of the
agreement Wolverine will pay Texada $10,000 per month plus expenses for
consulting services. The parties may by mutual consent
terminate the consulting agreement at anytime for any
reason. Wolverine has agreed not to terminate the consulting
agreement without cause prior to February 28, 2010 for any reason
whatsoever. If Wolverine does terminate the consulting
agreement without cause it will have to pay liquidated damages to Texada
Consulting Inc. See Exhibit 10.2 – Consulting Agreement for
more details.
·
On
February 27, 2007 Wolverine entered into a vend-in agreement with Shenin
Resources Inc. Under the terms of the vend-in agreement
Wolverine is required to perform minimum exploration work on the Labrador
Claims. In the first year of the agreement, ending March1, 2008, Wolverine was required to spend CDN$150,000 (US$153,092) in
mineral exploration on the Labrador Claims. By March 1, 2009 an
additional CDN$200,000 (US$201,160) must be spent and by March 1, 2010
another CDN$250,000 (US$251,450). Any extra money spent on
exploration in one year may be applied to the minimum payments due in
following years. As of May 31, 2008 Wolverine has spent
CDN$222,020 (US$224,054) on exploration and development on the Labrador
Claims. See Exhibit 10.1 – Vend-in Agreement and Exhibit 10.3 –
Additional Property Agreement for more
details.
Page
- 51
·
The
government of Newfoundland and Labrador also requires minimum exploration
work to be done on the Labrador Claims in order to keep the mineral lease
agreements for the claims current. Wolverine currently holds
522 claims covering 33,482 acres in central Labrador. Minimum
expenditures of $200 CDN per claim in the first year, $250 CDN per claim
in the second year, $300 CDN per claim in the third year, $350 CDN per
claim in the fourth year, $400 CDN per claim in the fifth year, $600 CDN
per claim in each of the sixth through tenth years, $900 CDN per claim in
each of the eleventh through fifteenth years and $1,200 CDN per claim in
each of the sixteenth through twentieth years of the claim are
required. Exploration expenditures that are applicable to the
vend-in agreement are also applicable to the mineral lease agreements with
the government of Newfoundland and
Labrador.
·
As
well, the government of Newfoundland and Labrador require a $25 CDN per
claim renewal fee in year five of a claim, $50 CDN per claim renewal fee
in year ten of the claim and a $100 CDN per claim renewal fee in year
fifteen of a claim. These fees are not covered by the mineral
exploration expenditures incurred on the Labrador Claims and will have to
be paid by Wolverine in the respective
years.
Contractual
Obligations
Wolverine’s
commitments under the consulting agreement with Texada, the vend-in agreement
with Shenin, and the mineral license agreements with the government of
Newfoundland and Labrador are the only contractual obligations that Wolverine
has and are as follows:
Contractual
Obligations
Total
Less
than 1 year
1
-3 years
3 –
5 years
More
than 5 years
Consulting
fees
US$ 210,000
US$ 120,000
US$ 90,000
US$ -
US$ -
Exploration
expenditures
(Vend-in
agreement)
379,930
(1)
128,480
251,450
-
-
Exploration
expenditures
(Mineral
lease agreements)
7,272,220
-
-
499,364
6,772,856
Renewal
fees
97,130
-
-
18,376
78,754
Total
US$
7,959,280
US$ 248,480
US$ 341,450
US$ 517,740
US$
6,851,610
(1)
Under
the vend-in agreement, Wolverine is required to spend an aggregate
$603,984 (CDN$600,000) in exploration expenditures. As of May31, 2008, Wolverine had spent $224,054 in exploration expenditures on the
Labrador Claims.
Minimum
expenditures required under the terms of the vend-in agreement also qualify as
minimum exploration expenditures under the terms of the license
agreements.
In order
to maintain the property in good standing with the government of Newfoundland
and Labrador over the next 19 years, Wolverine will be required to spend a total
of $7,749,280 exploration and development of the properties, of which Wolverine
has already spent $224,054 (CDN$222,020).
At May31, 2008, Wolverine had spent an additional $15,070 (CDN$15,000) on the Labrador
Claims, which has not yet been registered and approved by the government of
Newfoundland and Labrador. If the government authorizes these
payments as acceptable exploration expenditures then the total commitments under
the vend-in agreement will decrease by $15,070.
Internal
and External Sources of Liquidity
To date
Wolverine has funded its operations from the sale of its common
stock.
Foreign
Exchange
Wolverine
is subject to foreign exchange risk for transactions denominated in foreign
currencies. Foreign currency risk arises from the fluctuation of
foreign exchange rates and the degree of volatility of these rates relative to
the United States dollar. Management does not believe that Wolverine
has any material risk due to foreign currency exchange.
Inflation
Management
does not believe that inflation will have a material impact on Wolverine’s
future operations.
Page
- 52
Forward-looking
Statements
This
registration statement contains forward-looking statements within the meaning of
the federal securities laws that involve risks and uncertainties.
Statements that are not historical facts, including statements about
management’s beliefs and expectations, are forward-looking
statements. Forward-looking statements include statements preceded
by, followed by, or that include the words “may,”“could,”“would,”“should,”“believe,”“expect,”“anticipate,”“plan,”“estimate,”“target,”“project,”“intend,” or similar expressions. These statements include,
among others, statements regarding Wolverine’s current expectations, estimates
and projections about future events and financial trends affecting the financial
condition and operations of its business. Forward-looking statements
are only predictions and not guarantees of performance and speak only as of the
date they are made. Wolverine undertakes no obligation to update any
forward-looking statement in light of new information or future
events.
Although
management believes that the expectations, estimates and projections reflected
in the forward-looking statements are based on reasonable assumptions when they
are made, Wolverine can give no assurance that these expectations, estimates and
projections can be achieved. Management believes the forward-looking
statements in this registration statement are reasonable; however, you should
not place undue reliance on any forward-looking statement, as they are based on
current expectations. Future events and actual results may differ
materially from those discussed in the forward-looking
statements. Factors that could cause actual results to differ
materially from Wolverine’s expectations include, but are not limited
to:
·
fluctuating
prices of mineral resources, including gold and
copper,
·
the
impact of weather conditions and alternative energy sources on Wolverine’s
sales volumes,
·
changes
in federal or state laws and regulations to which Wolverine is subject,
including tax, environmental, and employment laws and
regulations,
·
conditions
of the capital markets that Wolverine utilizes to access
capital,
·
the
ability to raise capital in a cost-effective
way,
·
the
effect of changes in accounting policies, if
any,
·
the
ability of Wolverine to manage its
growth,
·
the
ability to control costs,
·
Wolverine’s
ability to achieve and maintain effective internal controls in accordance
with Section 404 of the Sarbanes-Oxley Act of
2002,
·
Wolverine’s
ability to obtain governmental and regulatory approval of various
expansion or other projects,
·
changes
in general economic conditions in the United States and in Canada and
changes in the industries in which Wolverine conducts its
business,
·
the
costs and effects of legal and administrative claims and proceedings
against Wolverine,
For a
more detailed discussion of these and other risks that may impact Wolverine’s
business, see “Risk Factors” beginning on page 7.
Changes In and Disagreements With
Accountants on Accounting and Financial Disclosure
Since
inception on February 23, 2006, there were no disagreements with Wolverine’s
accountants on any matter of accounting principle or practices, financial
statement disclosure or auditing scope or procedure. In addition,
there were no reportable events as described in Item 304 of Regulation S-K that
occurred within Wolverine’s two most recent fiscal years and the subsequent
interim periods.
Directors, Executive Officers,
Promoters and Control Persons
The sole
Director and Officer currently serving Wolverine is as follows:
Name
Age
Positions
Held and Tenure
Lee
Costerd
55
President,
Secretary, Treasurer and Director since February 23,2006
The sole
Director named above will serve until the next annual meeting of the
stockholders. Thereafter, directors will be elected for one-year
terms at the annual stockholders’ meeting. Officers will hold their
positions at the pleasure of the board of directors, absent any employment
agreement, of which none currently exists or is contemplated.
Page
- 53
Biographical
information
Lee
Costerd
Mr.
Costerd has acted as Wolverine’s sole Director and Officer since its inception
on February 23, 2006. Mr. Costerd has been involved in the mining
industry for the past 20 years. Mr. Costerd was the mine manager
for a placer mining operation in British Columbia and a supervisor at a
hard rock mining operation also in British Columbia.
Conflicts
of Interest
Though
Mr. Costerd does not work with any other mineral exploration companies other
than Wolverine, he may in the future. Wolverine does not have any
written procedures in place to address conflicts of interest that may arise
between its business and the future business activities of Mr.
Costerd.
Audit
Committee Financial Expert
Wolverine
does not have a financial expert serving on an audit
committee. Wolverine does not have an audit committee because it is a
start-up exploration company and has no revenue.
Significant
Employees and Consultants
Wolverine
has no significant employees.
Wolverine
entered into a Consulting Agreement dated January 31, 2007 with Texada
Consulting Inc. (“Texada”), a private Canadian
corporation owned by Deirdre Lynch, a related party. Texada provides
Wolverine with consulting services and receives compensation of $10,000 per
month. See Exhibit 10.1 – Consulting Agreement for more
details.
Stephen
Balch will act as consulting geophysicist for Wolverine. Mr. Balch
graduated with a B.Sc. (honours), Applied Geophysics, University of Western
Ontario in 1985. Mr. Balch is currently chief geophysicist of
Aeroquest International Limited (“Aeroquest”) and was President
and a director of Aeroquest between 2004 and 2007. Aeroquest is an
airborne survey company that services the mining, oil & gas, and UXO
industries. Aeroquest trades on the TSX Venture Exchange under the
trading symbol AQL. Mr. Balch is currently President of Balch
Exploration Consulting Inc. (“BECI”). BECI
provides consulting services to major mining and junior exploration companies in
the areas of geophysical survey design, geophysical interpretation, and data
integration. Between 1995 and 2001 Mr. Balch was senior geophysicist
with Inco Limited. In 2007, Wolverine retained the services of BECI
to provide geological consulting services. Pursuant to the terms of
an oral agreement, Wolverine paid BECI $3,000 per month up to March 31, 2008 for
providing geological consulting services. The oral agreement has been
modified so that BECI will be retained, if required, on a project-by-project
basis for field related activities. There is no term to this oral
agreement and it can be terminated with 30 days’ notice.
For
accounting requirements Wolverine utilizes the consulting services of DaCosta
Management Corp. of Vancouver, British Columbia, Canada to assist in the
preparation of the financial statements in accordance with accounting principles
generally accepted in the United States.
Family
Relationships
There are
no family relationships among the directors, executive officers or persons
nominated or chosen by Wolverine to become directors or executive
officers.
Involvement
in Certain Legal Proceedings
(1)
No
bankruptcy petition has been filed by or against any business of which any
director was a general partner or executive officer either at the time of
the bankruptcy or within two years prior to that
time.
(2)
No
director has been convicted in a criminal proceeding and is not subject to
a pending criminal proceeding (excluding traffic violations and other
minor offences).
(3)
No
director has been subject to any order, judgement, 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.
Page
- 54
(4)
No
director has been found by a court of competent jurisdiction (in a civil
action), the Securities Exchange Commission or the Commodity Futures
Trading Commission to have violated a federal or state securities or
commodities law, that has not been reversed, suspended, or
vacated.
Executive Compensation
Summary
Compensation Table
The table
below summarizes all compensation awarded to, earned by, or paid to Wolverine’s
Officer for all services rendered in all capacities to Wolverine for the fiscal
periods indicated.
Name
and principal position
(a)
Year
(b)
Salary
($)
(c)
Bonus
($)
(d)
Stock
Awards
($)
(e)
Option
Awards
($)
(f)
Non-Equity
Incentive Plan
($)
(g)
Non-qualified
Deferred Compen-
sation
Earnings ($)
(h)
All
other compen-sation
($)
(i)
Total
($)
(j)
Lee
Costerd
CEO
Feb
2006 - present
2006
2007
2008
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
nil
13,333 (1)
28,773 (2)
nil
13,333
28,773
(1)
Mr.
Costerd received an aggregate $12,793 in management fees and $540 for
reimbursement of expenses in the fiscal year ended May 31,2007.
(2)
Mr.
Costerd received an aggregate $28,222 in management fees and $469 for
reimbursement of expenses and accrued $82 for expenses in the fiscal year
ended May 31, 2008.
Wolverine’s
director has not received any monetary compensation as a director since
Wolverine’s inception to the date of this prospectus. Wolverine currently does
not pay any compensation to its director serving on its board of
directors.
Stock
Option Grants
Wolverine
has not granted any stock options to the executive officer since its inception
on February 23, 2006.
Employment
Agreements
Currently,
Wolverine does not have an employment agreement with Lee
Costerd. However, Wolverine pays Mr. Costerd a monthly management fee
as consideration for Mr. Costerd acting as the sole officer of Wolverine
pursuant to the terms of an oral agreement between the
parties. Wolverine is currently paying Mr. Costerd a management fee
of CDN$2,500 per month. Wolverine also reimburses Mr. Costerd for all
reasonable expenses incurred by Mr. Costerd while providing such services to
Wolverine. In the terms and conditions of the oral agreement, there
was no specified term of service during which Mr. Costerd has to provide the
consulting services. As a result, either party may terminate the
agreement on 30 days’ notice. Mr. Costerd has received an aggregate
$41,015 (CDN$43,967) in management fees and $1,091 (CDN$1,167) for reimbursement
of expenses from inception to the date of this prospectus.
There are
no other agreements between Wolverine and any named executive officer, and there
are no employment agreements or other compensating plans or arrangements with
regard to any named executive officer that provide for specific compensation in
the event of resignation, retirement, other termination of employment or from a
change of control of Wolverine or from a change in a named executive officer’s
responsibilities following a change in control.
Page
- 55
Security Ownership of Certain
Beneficial Owners and Management
The
following table sets forth, as of the date of this prospectus, the number of
shares of common stock owned of record and beneficially by executive officers,
directors, and persons who hold 5% or more of the outstanding common stock of
Wolverine.
Title
of Class
Name
and Address of Beneficial Owner
Number
of Shares Owned Beneficially
Percent
of Class Owned Prior To This Offering (1)
Common
Stock
Lee
Costerd
4055
McLean Road
Quesnel,
British Columbia
V2J
6V5 Canada
4,000,000
5.8%
Common
Stock
Ralph
Biggar
PH
1403
819
Hamilton Street
Vancouver,
British Columbia
V6B
6M2 Canada
5,000,000
7.3%
Common
Stock
Art
Den Duyf
7194
Nancy Green Drive
Whistler,
British Columbia
V0N
1B0 Canada
5,375,000
7.8%
Common
Stock
Richard
Haderer
103
Huntcroft Place NE
Calgary,
Alberta
T2K
4E6 Canada
5,250,000
7.6%
Common
Stock
Deirdre
Lynch
1450
Palmerston Ave
West
Vancouver, British Columbia
V7T
1H7 Canada
5,250,000
7.6%
Common
Stock
Neil
Nichols
#307A,
15252-32 Ave
Surrey,
British Columbia
V3S
0R7 Canada
5,250,000
(2)
7.6%
Common
Stock
Prote
Poker
35
Katshinak Street
P.O.
Box 57
Natuashish,
Newfoundland Labrador
A0P
1AO Canada
5,000,000
7.3%
Common
Stock
Thian
Yew Ng
4462
Cambie Street
Vancouver,
British Columbia
V6B
2Z6 Canada
5,225,000
7.6%
Common
Stock
All
executive officers
and
directors as a group
4,000,000
5.8%
(1)
The
percent of class is based on 68,630,000 shares of common stock issued and
outstanding as of August 22, 2008.
(2)
250,000
of these shares are registered in the name of Tequila Sunset Ltd., which
is owned by Neil Nichols.
Each
person listed above has full voting and investment power with respect to the
shares indicated. Under the rules of the Securities and Exchange
Commission, a person (or a group of persons) is deemed to be a “beneficial
owner” of a security if he or she, directly or indirectly, has or shares power
to vote or to direct the voting of such security. Accordingly, more
than one person may be deemed to be a beneficial owner of the same
security. A person is also deemed to be a beneficial owner of any
security, which that person has the right to acquire within 60 days, such as
options or warrants to purchase Wolverine’s common stock.
Page
- 56
Transactions with Related Persons,
Promoters and
Certain Control Persons
(a) Transactions
with Related Persons
During
Wolverine’s last three fiscal years, no director, executive officer, security
holder, nor any immediate family of such director, executive officer, nor
security holder owning 5% or more has had any direct or indirect material
interest in any transaction or currently proposed transaction, which Wolverine
was or is to be a participant, that exceeded the lesser of (1) $120,000 or (2)
one percent of the average of Wolverine’s total assets at year-end for the last
two completed fiscal years, except for the following:
1.
Vend-in
of Property
On
February 28, 2007 Wolverine entered into a Vend-In Agreement with Shenin
Resources Inc. for the purchase of a 90% interest in 516 mineral claims located
in Labrador Canada. The purchase price paid to Shenin was $34,000 and
the purchase price paid to the prospectors and grubstakers was satisfied by the
issuance of 34 million restricted shares of Wolverine’s common stock at a deemed
price of $0.01 per share. Each of the prospectors and grubstakers is
a 5% shareholder in Wolverine. The 34 million shares were issued to
the seven prospectors and grubstakers as follow:
a.
Ralph
Biggar – 4,000,0000 restricted
shares
b.
Arthur
Den Duyf – 5,000,000 restricted
shares
c.
Richard
Haderer – 5,000,000 restricted
shares
d.
Deirdre
Lynch – 5,000,000 restricted shares
e.
Thain
Yew Ng – 5,000,000 restricted
shares
f.
Neil
Nichols – 5,000,000 restricted
shares
g.
Prote
Poker – 5,000,000 restricted shares
See
Exhibit 10.1 – Vend-in Agreement for more details.
Also, on
May 17, 2007, Wolverine paid Richard Haderer an additional $321 (CDN$360) for
additional mineral claims staked on behalf of Wolverine. The $321
(CDN$360) represented a reimbursement of the staking costs for the additional
mineral claims. The additional mineral claims were staked on behalf
of Wolverine pursuant to the terms and conditions of the Vend-In
Agreement. Mr. Haderer is also the president of
Shenin. See Exhibit 10.3 – Additional Property Agreement for more
details.
Wolverine
pays Lee Costerd a management fee of $2,337 (CDN$2,500) per month as
consideration for Mr. Costerd acting as the sole officer of Wolverine pursuant
to the terms of an oral agreement between the parties. Wolverine also
reimburses Mr. Costerd for all reasonable expenses incurred by Mr. Costerd while
providing such services to Wolverine. In the terms and conditions of
the oral agreement, there was no specified term of service during which Mr.
Costerd has to provide the consulting services. As a result, either
party may terminate the agreement on 30 days’ notice. Mr. Costerd has
received management fees of $41,015 (CDN$43,967) and reimbursement of expenses
of $1,091 (CDN$1,167) from inception to May 31, 2008.
3.
Consulting
Agreement with Texada Consulting
Inc.
On
January 31, 2007, Wolverine entered a consulting agreement with Texada
Consulting Inc., which is 100% owned by Deidre Lynch, a 5% shareholder of
Wolverine. Pursuant to the terms of the consulting agreement, Texada,
through its designated person, Bruce Costerd, provides Wolverine with
consulting, management and labor supply services. For those services,
Wolverine pays Texada Consulting Inc. a monthly consulting fee of $10,000, plus
any approved reasonable expense claims and any applicable
taxes. Wolverine is also obliged to provide or pay for non-exclusive
office space with parking for Texada to provide the services under the
agreement. The term of the consulting agreement is one year and will
renew automatically for successive one year terms, unless amended or
terminated. The parties may by mutual consent terminate the
consulting agreement at anytime for any reason. Wolverine has agreed
not to terminate the consulting agreement without cause prior to February 28,2010 for any reason whatsoever. If Wolverine does terminate the
consulting agreement without cause it will have to pay liquidated damages to
Texada Consulting Inc. Finally, Texada will receive a bonus of an
issuance of shares of common stock in the capital of Wolverine equal to 5% of
the issued and outstanding shares on a non-diluted basis as of the date of the
issuance of the bonus shares if Wolverine discovers a major mineral resource
deposit on any mineral property that Texada was involved with, which is
currently the Labrador Claims. The payment of the bonus shares will
survive the termination of this consulting agreement. Texada has
received consulting fees of $257,192, reimbursement of expenses of $5,374, and
rent of $15,741 from inception to May 31, 2008, and has also accrued $9,400 in
consulting fees. See Exhibit 10.2 – Consulting Agreement for more
details.
Page
- 57
4.
Consulting
Agreement with PubCo Services Inc.
From
February 2006 to February 2007, Wolverine paid PubCo Services Inc. a total of
$51,229, which was paid in full by May 31, 2008, for providing various services
to Wolverine in the early stages of Wolverine’s development. Richard
Haderer is the owner of PubCo Services Inc. and a 5% shareholder of
Wolverine. Currently, there is no agreement between Wolverine and
PubCo Services Inc. for the provision of any further services or any further
payments. PubCo was and will be, if required, retained on a
project-by-project basis.
5.
Consulting
Agreement with Bruce Costerd
From
February 2006 to February 2007, Wolverine paid Bruce Costerd, the brother of Lee
Costerd, a total of $17,527 in consulting fees and $3,304 for rent payments for
providing various services to Wolverine in the early stages of Wolverine’s
development. Currently, there is no agreement between Wolverine and
Mr. Costerd for the provision of any further services or any further
payments. Mr. Costerd was and will be, if required, retained on a
project-by-project basis.
(b) Review,
approval or ratification of transactions with related persons
Currently
Wolverine does not have any policies and procedures for the review, approval, or
ratification of transactions with related persons.
(c) Promoters
and certain control persons
During
the past two fiscal years, Lee Costerd has been the only promoter of Wolverine’s
business, but Mr. Costerd has not received anything of value from Wolverine nor
is any person entitled to receive anything of value from Wolverine for services
provided as a promoter of the business of Wolverine.
(d) Director
independence
Wolverine’s
board of directors currently solely consists of Lee Costerd. Pursuant
to Item 407(a) of Regulation S-K of the Securities Act, Wolverine’s board of
directors has adopted the definition of “independent director” as set forth in
Rule 4200(a)(15) of the NASDAQ Manual. In summary, an “independent
director” means a person other than an executive officer or employee of
Wolverine or any other individual having a relationship which, in the opinion of
Wolverine’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 Wolverine in excess of $200,000
during any period of 12 consecutive months with the three past fiscal
years. Also, the ownership of Wolverine’s stock will not preclude a
director from being independent.
In
applying this definition, Wolverine’s board of directors has determined that Mr.
Costerd does not qualify as an “independent director” pursuant to the same
Rule.
As of the
date of the prospectus, Wolverine did not maintain a separately designated
compensation or nominating committee.
Wolverine
has also adopted this definition for the independence of the members of its
audit committee. Lee Costerd is the sole member of Wolverine’s audit
committee. Wolverine’s board of directors has determined that Mr.
Costerd is not “independent” for purposes of Rule 4200(a)(15) of the NASDAQ
Manual, applicable to audit, compensation and nominating committee members, and
is not “independent” for purposes of Section 10A(m)(3) of the Securities
Exchange Act.
Disclosure of Commission Position of
Indemnification for Securities Act Liabilities
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers or persons controlling Wolverine pursuant to
provisions of the State of Nevada, Wolverine has been informed that, in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in that Act and is, therefore,
unenforceable.
Page
- 58
Dealer
Prospectus Delivery Obligation
Until
[180 days from the effective date of this prospectus], all dealers that effect
transactions in these securities, whether or not participating in this offering,
may be required to deliver a prospectus. This is in addition to the
dealers’ obligation to deliver a prospectus when acting as underwriters and with
respect to their unsold allotments or subscriptions.
Page
- 59
Part
II - Information Not Required In Prospectus
Other
Expenses of Issuance and Distribution
The
estimated costs of this offering are as follows:
SEC
Registration Fee
$ 500
Legal
Fees and Expenses
30,000
Accounting
Fees and Expenses
7,500
Auditor
Fees and Expenses
24,000
Electronic
Filing Fees
2,000
Printing
Costs
500
Courier
Costs
500
Transfer
Agent Fees
3,000
Total
$ 68,000
All
amounts are estimates. Wolverine is paying all expenses listed
above. None of the above expenses of issuance and distribution will
be borne by the selling shareholders. The selling shareholders,
however, will pay any other expenses incurred in selling their common stock,
including any brokerage commissions or costs of sale.
Indemnification
of Directors and Officers
As
permitted by Nevada law, Wolverine’s Articles of Incorporation provide that it
will indemnify Wolverine’s directors and officers against expenses and
liabilities they incur to defend, settle or satisfy any civil or criminal action
brought against them on account of their being or having been directors or
officers of Wolverine, unless, in any such action, they are adjudged to have
acted with gross negligence or willful misconduct.
Exclusion
of Liabilities
Pursuant
to the laws of the State of Nevada, Wolverine’s Articles of Incorporation
exclude personal liability for its directors for monetary damages based upon any
violation of their fiduciary duties as directors, except as to liability for any
breach of the duty of loyalty, acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, acts in violation
of Section 7-106-401 of the Nevada Business Corporation Act, or any transaction
from which a director receives an improper personal benefit. This
exclusion of liability does not limit any right, which a director may have to be
indemnified, and does not affect any director’s liability under federal or
applicable state securities laws.
Disclosure
of Commission position on Indemnification for Securities Act
Liabilities
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers or persons controlling Wolverine pursuant to
provisions of the State of Nevada, Wolverine has been informed that, in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in that Act and is, therefore,
unenforceable.
Recent
Sales of Unregistered Securities
As of
August 22, 2008 Wolverine has sold 68,630,000 shares of unregistered securities.
All of these 68,630,000 shares were acquired from Wolverine in private
placements and the acquisition of mining claims that were exempt from
registration under Regulation S of the Securities Act of 1933 and were sold to
non-US residents and private placements that were exempt from registration under
Regulation D of the Securities Act of 1933 and were sold to US
residents.
The
shares include the following:
1.
On
April 3, 2006, Wolverine issued 4,000,000 shares of common stock at a
price of $0.001 per share for cash proceeds of $4,000 to its President;
and
2.
On
June 13, 2006, Wolverine issued 2,750,000 shares of common stock to 11
non-affiliate Canadian residents and one non-affiliate International
resident at a price of $0.01 per share for cash proceeds of
$27,500;
Page
- 60
3.
On
January 31, 2007, Wolverine issued 2,150,000 shares of common stock to 19
non-affiliate Canadian residents and one non-affiliate International
resident at a price of $0.01 per share for cash proceeds of
$21,500;
4.
On
February 28, 2007, Wolverine issued 34,000,000 shares of common stock to
seven non-affiliate Canadian residents pursuant to a Vend-In Agreement
dated February 28, 2007 with Shenin Resources Inc., a non-affiliate
Canadian company, at a deemed price of $0.01 per share for the acquisition
of the majority of the Labrador
Claims.
5.
Also,
on February 28, 2007, Wolverine issued 2,600,000 shares of common stock to
10 non-affiliate Canadian residents at a price of $0.01 per share for cash
proceeds of $26,000;
6.
On
March 30, 2007, Wolverine issued 1,600,000 shares of common stock to 10
non-affiliate Canadian residents at a price of $0.01 per share for cash
proceeds of $16,000;
7.
On
April 30, 2007, Wolverine issued 4,000,000 shares of common stock to 18
non-affiliate Canadian residents and two non-affiliate U.S. residents at a
price of $0.01 per share for cash proceeds of
$40,000;
8.
On
May 31, 2007, Wolverine issued 1,100,000 shares of common stock to two
non-affiliate Canadian residents at a price of $0.01 per share for cash
proceeds of $11,000;
9.
On
June 30, 2007, Wolverine issued 6,890,000 shares of common stock to 24
non-affiliate Canadian residents and one non-affiliate U.S. resident at a
price of $0.01 per share for cash proceeds of
$68,900;
10.
.On
July 31, 2007, Wolverine issued 2,550,000 shares of common stock to 10
non-affiliate Canadian residents at a price of $0.01 per share for cash
proceeds of $25,500;
11.
On
September 7, 2007, Wolverine issued 2,000,000 shares of common stock to
eight non-affiliate Canadian residents, two non-affiliate International
residents, and one non-affiliate U.S. Resident at a price of $0.01 per
share for cash proceeds of $20,000;
12.
On
September 8, 2007, Wolverine issued 2,890,000 shares of common stock to 16
non-affiliate Canadian residents, one non-affiliate International
resident, and two non-affiliate U.S. residents at a price of $0.10 per
share for cash proceeds of
$289,000;
13.
On
October 5, 2007, Wolverine issued 1,000,000 shares of common stock to 11
non-affiliate Canadian residents at a price of $0.10 per share for cash
proceeds of $100,000; and
14.
On
June 25, 2008, Wolverine issued 1,100,000 shares of common stock to six
non-affiliate Canadian residents, two non-affiliate International
residents, and three non-affiliate U.S. residents at a price of $0.10 per
share for cash proceeds of
$110,000;
With
respect the above offerings to Canadian and International residents, Wolverine
completed the offerings of the common stock pursuant to Rule 903 of Regulation S
of the Act on the basis that the sale of the common stock was completed in an
“offshore transaction”, as defined in Rule 902(h) of Regulation
S. Wolverine 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. Each investor represented to Wolverine that the investor 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 Wolverine and the investor included statements that
the securities had not been registered pursuant to the Act and that the
securities may not be offered or sold in the United States unless the securities
are registered under the Act or pursuant to an exemption from the
Act. The investor agreed by execution of the subscription agreement
for the common stock: (i) to resell the securities purchased only in accordance
with the provisions of Regulation S, pursuant to registration under the Act or
pursuant to an exemption from registration under the Act; (ii) that Wolverine is
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 Act or pursuant to an exemption from registration under
the Act; and (iii) not to engage in hedging transactions with regards to the
securities purchased unless in compliance with the Act. All
securities issued were endorsed with a restrictive legend confirming that the
securities had been issued pursuant to Regulation S of the Act and could not be
resold without registration under the Act or an applicable exemption from the
registration requirements of the Act.
With
respect to the above offerings to U.S. residents, Wolverine completed the
offerings of the common stock pursuant to Rule 506 of Regulation D of the
Act. The subscription agreement executed between Wolverine and the
investor included statements that the securities had not been registered
pursuant to the Act and that the securities may not be offered or sold in the
United States unless the securities are registered under the Act or pursuant to
an exemption from the Act. The investor agreed by execution of the
subscription agreement for the common stock: (i) to resell the securities
purchased only in accordance with the provisions of Regulation D, pursuant to
registration under the Act or pursuant to an exemption from registration under
the Act; (ii) that Wolverine is required to refuse to register any sale of the
securities purchased unless the transfer is in accordance with the provisions of
Regulation D, pursuant to registration under the Act or pursuant to an exemption
from registration under the Act; and (iii) not to engage in hedging transactions
with regards to the securities purchased unless in compliance with the
Act. All securities issued were endorsed with a restrictive legend
confirming that the securities had been issued pursuant to Regulation D of the
Act and could not be resold without registration under the Act or an applicable
exemption from the registration requirements of the Act.
Page
- 61
Each
investor was given adequate access to sufficient information about Wolverine to
make an informed investment decision. None of the securities were
sold through an underwriter and accordingly, there were no underwriting
discounts or commissions involved. No registration rights were
granted to any of the purchasers.
Exhibits
Exhibit
Number
Description
3.1
Articles
of Incorporation of Wolverine Exploration Inc., filed as an Exhibit to
Wolverine’s Form S-1 (Registration Statement) filed on July 15, 2008 and
incorporated herein by reference.
3.2
By-Laws
of Wolverine Exploration Inc., filed as an Exhibit to Wolverine’s Form S-1
(Registration Statement) filed on July 15, 2008 and incorporated herein by
reference.
3.3
Certificate
of Amendment of Wolverine Exploration Inc., filed as an Exhibit to
Wolverine’s Form S-1 (Registration Statement) filed on July 15, 2008 and
incorporated herein by reference.
3.4
Certificate
of Registration of Extra-Provincial Corporation, filed as an Exhibit to
Wolverine’s Form S-1 (Registration Statement) filed on July 15, 2008 and
incorporated herein by reference.
5.1
Opinion
of Conrad C. Lysiak, regarding the legality of the securities being
registered.
10.1
Vend-In
Agreement dated February 28, 2007 between Wolverine and Shenin Resources
Inc., filed as an Exhibit to Wolverine’s Form S-1 (Registration Statement)
filed on July 15, 2008 and incorporated herein by
reference.
10.2
Consulting
Agreement dated January 31, 2007 between Wolverine and Texada Consulting
Inc., filed as an Exhibit to Wolverine’s Form S-1 (Registration Statement)
filed on July 15, 2008 and incorporated herein by
reference.
10.3
Additional
Property Agreement dated May 17, 2007 among Wolverine, Shenin Resources
Inc. and Richard Haderer, filed as an Exhibit to Wolverine’s Form S-1
(Registration Statement) filed on July 15, 2008 and incorporated herein by
reference.
14
Code
of Ethics, filed as an Exhibit to Wolverine’s Form S-1 (Registration
Statement) filed on July 15, 2008 and incorporated herein by
reference.
23.1
Consent
of Independent Auditor
23.2
Consent
of Conrad C. Lysiak, filed as an Exhibit to Wolverine’s Form S-1
(Registration Statement) filed on July 15, 2008 and incorporated herein by
reference.
Undertakings
The
undersigned registrant hereby undertakes:
1.
To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement
to:
a)
include
any prospectus required by Section 10(a)(3) of the Securities Act of
1933;
b)
reflect
in Wolverine’s prospectus any facts or events arising after the effective
date of this registration statement, or most recent post-effective
amendment, which, individually or in the aggregate, represent a
fundamental change in the information set forth in this registration
statement. Notwithstanding the foregoing, any increase or
decrease if the securities offered (if the total dollar value of
securities offered would not exceed that which was registered) any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in
the effective registration
statement.
c)
include
any material information with respect to the plan of distribution not
previously disclosed in this registration statement or any material change
to such information in this registration
statement.
2.
That,
for the purpose of determining any liability under the Securities Act,
each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
3.
To
remove from registration by means of a post-effective amendment any of the
securities being registered hereby which remain unsold at the termination
of the offering.
Page
- 62
4.
For
determining liability of the undersigned registrant under the Securities
Act to any purchaser in the initial distribution of the securities, the
undersigned registrant undertakes that in a primary offering of securities
of the undersigned registrant pursuant to this registration statement,
regardless of the underwriting method used to sell the securities to the
purchaser, if the securities are offered or sold to such purchaser by
means of any of the following communications, the undersigned registrant
will be a seller to the purchaser and will be considered to offer or sell
such securities to such purchaser:
a.
any
preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule
424;
b.
any
free writing prospectus relating to the offering prepared by or on behalf
of the undersigned registrant or used or referred to by the undersigned
registrant;
c.
the
portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or its
securities provided by or on behalf of the undersigned registrant;
and
d.
any
other communication that is an offer in the offering made by the
undersigned registrant to the
purchaser.
5.
That
each prospectus filed pursuant to Rule 424(b) as part of a registration
statement relating to an offering, other than registration statements
relying on Rule 430B or other than prospectuses filed in reliance on Rule
340A, will be deemed to be part of and included in this registration
statement as of the date it is first used after
effectiveness. Provided, however, that no statement made in a
registration statement or prospectus that is part of this registration
statement or made in a document incorporated or deemed incorporated by
reference into this registration statement or prospectus that is a part of
this registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any
statement that was made in this registration statement or prospectus that
was part of this registration statement or made in any such document
immediately prior to such date of first
use.
Insofar
as indemnification for liabilities arising under that Securities Act may be
permitted to Wolverine’s directors, officers and controlling persons pursuant to
the provisions above, or otherwise, we have been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act, and is, therefore,
unenforceable.
In the
event that a claim for indemnification against such liabilities, other than the
payment by Wolverine of expenses incurred or paid by one of its directors,
officers or controlling persons in the successful defense of any action, suit or
proceeding, is asserted by one of Wolverine’s directors, officers or controlling
persons in connection with the securities being registered, Wolverine will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification is against the public policy as expressed in the Securities
Act, and a will be governed by the final adjudication of such issue
Signatures
Pursuant
to the requirements of the Securities Act of 1933, the registrant has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereto, duly authorized in the City of Quesnel, Province of
British Columbia on September 16, 2008.
Director,
President (Principal Executive Officer), Principal Financial Officer and
Principal Accounting Officer
Pursuant
to the requirements of Securities Act of 1933, this registration statement was
signed by the following persons in the capacities and the dates
stated:
Please be
advised that, I have reached the following conclusions regarding the above
offering:
1.
Wolverine Exploration Inc., (the "Company") is a duly and legally organized and
existing Nevada state corporation, with its registered office located in
Henderson, Nevada and its principal place of business located in Quesnel,
British Columbia, Canada. The Articles of Incorporation and corporate
registration fees were submitted to the Nevada Secretary of State's office and
filed with the office on February 23, 2006. The Company's existence and form is
valid and legal pursuant to Nevada law.
2. The
Company is a fully and duly incorporated Nevada corporate entity. The
Company has one class of Common Stock at this time. Neither the
Articles of Incorporation, Bylaws, and amendments thereto, nor subsequent
resolutions change the non-assessable characteristics of the Company's common
shares of stock. The 64,630,000 shares of Common Stock previously
issued by the Company and being registered by certain selling shareholders in
this registration statement are in legal form and in compliance with the laws of
the State of Nevada, its Constitution and reported judicial decisions
interpreting those laws and when such stock was issued it was duly authorized,
fully paid for and non-assessable. Further, the sharers of common
stock to be sold by the selling shareholders will, when sold, be legally issued,
fully paid and non-assessable. The common stock and warrants to be sold under
this Form S-1 Registration Statement is likewise legal under the laws of the
State of Nevada, its Constitution and reported judicial decisions interpreting
those laws and when such stock is issued it will be duly authorized, fully paid
for and non-assessable.
3. To
my knowledge, the Company is not a party to any legal proceedings nor are there
any judgments against the Company, nor are there any actions or suits filed or
threatened against it or its officers and directors, in their capacities as
such, other than as set forth in the registration statement. I know
of no disputes involving the Company and the Company has no claim, actions or
inquires from any federal, state or other government agency, other than as set
forth in the registration statement. I know of no claims against the
Company or any reputed claims against it at this time, other than as set forth
in the registration statement.
4. The
Company's outstanding shares are all common shares. There are no
liquidation preference rights held by any of the Shareholders upon voluntary or
involuntary liquidation of the Company.
5. The
warrants comprising the units are binding obligations under applicable state
contract law.
6. The
directors and officers of the Company are indemnified against all costs,
expenses, judgments and liabilities, including attorney's fees, reasonably
incurred by or imposed upon them or any of them in connection with or resulting
from any action, suit or proceedings, civil or general, in which the officer or
director is or may be made a party by reason of his being or having been such a
director or officer. This indemnification is not exclusive of other
rights to which such director or officer may be entitled as a matter of
law.
7. By
director's resolution, the Company has authorized the issuance of no units
minimum, 15,000,000 units maximum, each unit consisting of one share
of common stock and one redeemable warrant at an offering price of $0.10 per
unit. Further, the Company has authorized the issuance of no shares
common stock minimum, 15,000,000 shares of common stock maximum upon
the exercise of the redeemable warrants which are components of the
unit. The exercise price of each redeemable warrant is $0.15 per
share.
The Company's Articles
of Incorporation presently provide the authority to the Company to issue
200,000,000 shares of common stock, with a par value of $0.001 per
share. Therefore, the board of directors’ resolution which authorized
the issuance for sale of up to 15,000,000 units each unit consisting of one
share of common stock, one redeemable warrant, and one share underlying each
redeemable warrant is within the authority of the Company's directors and the
shares of common stock and warrants, when issued, will be validly issued, fully
paid and non-assessable.
I consent
to filing this opinion as an exhibit to the Company’s Form S-1 registration
statement.
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We
consent to the reference in this Registration Statement on Form S-1/A
(Registration No. 333-152343) of our report dated September 5, 2008 relating to
the financial statements of Wolverine Exploration, Inc. for the fiscal years
ended May 31, 2008 and 2007, and to the reference to our firm under the caption
“Interests of Named Experts and Counsel” in the Prospectus.
I HEREBY
CONSENT to the inclusion of my name in connection with the amended Form S-1
Registration Statement filed with the Securities and Exchange Commission as
attorney having passed on the legality of the units, warrants, and shares of
common stock being offered for sale by Wolverine Exploration Inc. and 64,630,000
shares of common stock being offered by certain selling shareholders named
therein.
DATED
this 9th day of
September 2008.
Yours
truly,
The
Law Office of Conrad C. Lysiak, P.S.
/s/
Conrad C. Lysiak
By:
Conrad C.
Lysiak
Page
- 70
Dates Referenced Herein and Documents Incorporated by Reference
