Silver Dragon Resources Inc.

On June 28, 2016 the board concluded that the 2015 and 2014 annual financial statements, the audit report, and the 2015 and 2014 quarterly statements should no longer be relied on, because of new information about adjustments to the restated December 31, 2015 figures for the company's equity investment in China. The filing says the full changes cannot yet be quantified, and the company is engaging local counsel in China to investigate. Separately, from July 1, 2016 the stock moved from the OTCQB to the OTC Pink. This is a second non-reliance event after November 2012 and leaves the corrected financials an open item.

financial restatement

On April 7-8, 2016 the company and Tonaquint agreed a settlement: a new secured convertible note of $6,836,556.53 replaced the previous note, which had a $9,093,950 balance, with $2,677,393.47 forgiven and $400,000 in cash paid to the company. The new note carries 12% interest, matures March 31, 2019, is secured on all company assets and on its Sino-Top equity, and is convertible at $0.015 per share from December 31, 2016, with a lower price if market capitalization falls below $4,000,000. The company must reserve 150,000,000 shares for conversions, Tonaquint gets a board observer and a right to take part in 50% of future financings, and the company signed a confession of judgment. This replaces the December 2012 payoff arrangement with Tonaquint, ends Tonaquint's court action in Utah, and raises dilution risk for shareholders.

capital raising announcement

The company rejected Beijing Shengda Industrial Group's offer of RMB161,922,820 (about US$25 million), paid in installments through 2019, for its 20% interest in Guangda, a subsidiary of Sino-Top, and treated the January 2016 equity transfer agreement as terminated. It countered on February 4, 2016 at RMB265,000,000 (about US$40 million) for its 20% interest in Sino-Top, covering all six properties, half at closing and half on regulatory approval by December 31, 2016. Any sale would need shareholder and Chinese regulatory approval, and the filing says there is no assurance the counter offer will be accepted. This continues the October 2014 Shengda acquisition thread.

material agreement termination

On October 7, 2014 the company announced that its Chinese joint venture Sanhe Sino-Top has signed an agreement with Shengda Mining Co., Ltd. to be acquired, subject to a third-party evaluation and all regulatory approvals and filings. No price or terms are given in the filing. This is the first sign of a possible sale of the Chinese assets that have been the company's focus.

material agreement

The lender payoff deadline was extended again: to March 31, 2014 for GEL, JMJ and Asher (agreed November 8, 2013), and to December 31, 2013 for Tonaquint (November 13). On November 27, 2013 Tonaquint agreed that $2,500,000 paid by March 31, 2014 would settle everything owed to it, which is higher than its December 2012 payoff figure of $2,130,048.92.

material agreement

Effective April 12, 2013 the company and all four lenders (Asher, GEL, JMJ, Tonaquint) extended the payoff deadline from March 31 to June 30, 2013. The combined payoff is $2,689,133 and all other terms are unchanged. The March deadline passed without the payoffs being made.

material agreement

On December 20, 2012 the company agreed with Tonaquint that paying $2,130,048.92 by March 31, 2013 settles all obligations under its convertible note. Tonaquint will not convert or enforce until then; the deal is cancelled if payment is missed, and mutual releases are agreed. This is the largest of the lender payoffs and the filing does not say how it will be funded.

material agreement

On December 13, 2012 the company agreed with JMJ Financial that paying $194,083.65 by March 31, 2013 settles all obligations under its convertible notes. JMJ will not convert shares or enforce remedies until then, and the parties agreed mutual releases. The filing does not say what happens if payment is missed or how it will be funded.

material agreement

On December 6, 2012 the company agreed with lender GEL Properties, LLC that paying $271,500 settles everything owed under its convertible notes. The deadline is the earlier of a sale or merger of the company or March 31, 2013. Until then GEL will not convert or enforce, and the deal is cancelled if payment is missed; mutual releases are agreed. This follows the same pattern as the Asher deal and the filing does not say how the payment will be funded.

material agreement

On November 20, 2012 the auditor SF Partnership told the company that its annual statements for 2011 and 2010 and its interim statements for the first and second quarters of 2012 and 2011 can no longer be relied on. The auditor said certain notes receivable, convertible notes payable and related financing and interest items were recorded before the agreements were actually signed. The financial impact is still under investigation, and the audit committee agreed the statements cannot be relied on. This is a third restatement after those in 2007, and it covers the period of the Tonaquint and JMJ financings.

financial restatement

On April 19, 2011 the company agreed with JMJ Financial to sell convertible notes with a face amount of $3,150,000, of which $3,000,000 goes to the company and the rest covers fees and expenses to JMJ. The first note brings in $1 million in staged payments tied to registration steps and conditions, and later notes of $500,000 each ($2,000,000 in total, secured) follow over three years. The notes convert at 75% of the average of the three lowest closing prices in the prior 20 days, so conversion would add shares at a discount. Proceeds are planned for a Canadian stock exchange listing, work at the Erbahuo silver properties in China, and general corporate purposes.

capital raising announcement

On February 15, 2011 the company sold Tonaquint, Inc. a secured convertible note with a $2,766,500 maturity amount (5.5% interest, due in 48 months), a warrant for 8.6 million shares at US$0.50 over three years, and 50,000 shares. Funding is $2,500,000 in total, but only $500,000 is cash at closing; the other $2,000,000 is ten $200,000 notes from the investor that are paid later. The note converts after six months at 70% of a low recent average price, so conversions would add shares at a discount; the investor's holding is capped at 9.99%.

capital raising announcement

On January 27, 2011 a California court approved a settlement of a $405,981.49 claim by Socius CG II, which had bought the claims from seven creditors of the company. The company issued 9,000,000 shares (about 8.28% of shares outstanding), with a later adjustment based on the stock price over 20 trading days that could mean more shares issued or some returned; Socius's holdings are capped at 9.99%. The debt is settled in stock, diluting existing holders.

capital raising announcement

On July 10, 2008 the company settled a dispute with Alpha Capital Anstalt, which had invested under the November 2, 2006 subscription agreement (the $500,000 placement). It will issue 3,000,000 shares (effective price cut to $0.15 per share through anti-dilution protection, plus 500,000 shares for the Class A and B warrants, plus 53,266 extra shares) and pay $25,000 in cash, and the company also gives up the $75,000 warrant exercise price. The subscription agreement ends and the lawsuit is dismissed once these steps are done. Existing shareholders are diluted, and the company agreed not to sell shares below $0.15 until Sept 30, 2008 and not to do a reverse split for six months.

capital raising announcement

Around June 1, 2007 the company decided its audited 2006 annual statements can no longer be relied on, because trade payables and exploration expense were understated. The restated statements were filed in a 10-KSB/A on July 9, 2007. This is a second restatement after the one covering the 2006 quarterly reports, and the filing gives no restated amounts.

financial restatement

On January 26, 2007 the company decided its quarterly reports for March, June and September 2006 can no longer be relied on, and said it would restate them by March 20, 2007. It had wrongly capitalized all exploration costs (treated them as assets rather than expenses) and had used incorrect inputs to value its warrants. This undermines the 2006 figures shareholders saw, and was discussed with its auditor SF Partnership.

financial restatement

On September 15, 2006 the company raised another US$2,000,000 by selling 2,000,000 units at US$1.00, each with a share and warrants at $2.00 and $5.00 exercisable over two years. The proceeds are earmarked, as in June, for the Cerro Las Minitas and Sino Silver transactions and for fees and administrative costs. It continues the pattern of funding through new share issues.

capital raising announcement

In June 2006 the company raised US$3,000,000 by selling 3,000,000 units at US$1.00, each with a share and warrants at US$2.00 and US$5.00. The money is earmarked for the Cerro Las Minitas transactions, the Sino Silver transaction, and legal, accounting and administrative costs. New shares dilute existing holders, but the funds go toward the pending Sino Silver payments.

capital raising announcement

On March 21, 2006 the company agreed to buy Sino Silver Corp.'s 60% interest in Sanhe Sino-Top Resources and Technologies, which holds exploration and mining rights to 9 properties in the Erbaohuo Silver District, for US$650,000 plus 4,000,000 restricted shares. US$150,000 was paid at closing, US$100,000 is due May 20, 2006, and US$400,000 plus the shares are due once Chinese provincial approval is received. The company also committed about US$1,300,000 of 2006 spending on the properties. This builds on the April 2005 Sino Silver deal and widens the China holding from a share of sale proceeds on one property to a majority stake in a company holding nine.

asset acquisition disposition

In March 2006 the company's Mexican subsidiary acquired mining rights to 16 concessions in Guadalupe, Durango, each including an operating mine: 10 from Jaime Muguiro Pena for US$799,000 payable over three years, 5 from Ramon Tomas Davila Flores for US$245,000 plus 110,000 shares, and 1 (Puro Corazon) from Minera Real Victoria for US$400,000 plus 2,000,000 shares, with a further US$50,000 paid to the owner Silvia Villasenor Haro and an option to buy the concession outright for US$2,000,000 or US$3,000,000. Pena may keep taking up to 30 tons of ore per day until he is paid in full. The company also sold 1,000,000 units at $1.00 for $1,000,000 on February 17, 2006, each with warrants at $2.00 and $5.00. This adds Mexican operating-mine interests and creates payment commitments over the next three years.

asset acquisition disposition

On November 30, 2005 the company signed an agreement with Dutchess Private Equities Fund letting it sell up to $10,000,000 of its common stock over three years, starting once the SEC approves a registration statement covering the shares. Each sale is priced at 95% of the lowest closing bid in the five trading days after the company's notice, and the fund's obligation to buy depends on an effective registration statement and continued OTC Bulletin Board trading. For shareholders, this is a possible source of funding that would mean issuing new shares; nothing has been sold yet under it.

material agreement

The company signed a joint venture agreement on September 7, 2005 with Linear Gold giving it an option to acquire 55% of the Tierra Blanca Property in Durango, Mexico (Linear Gold would keep 45%). It paid Linear Gold $45,000 and issued 100,000 shares at signing, with further payments of $75,000 and $110,000, 500,000 more shares, and work spending of $150,000, $200,000 and $500,000 over three years needed to exercise; it can end the obligations on thirty days' notice. It also sold 2,600,000 shares at $0.10 for $260,000 in September 2005. This is the company's first asset outside China, following the April 2005 Sino Silver deal.

asset acquisition disposition

Now named Silver Dragon Resources, the company signed a deal on April 14, 2005 with Sino Silver Corp. to acquire 50% of Sino Silver's interest in net proceeds from any sale of minerals or mining rights from the Aobaotugounao property in China's Erbaohuo Silver District. It pays US$350,000 over two years (US$150,000 paid at closing) plus 250,000 restricted shares, with another 250,000 due in one year. It also sold 3,000,000 restricted shares at $0.10 for $300,000. This is the company's move into silver exploration after its earlier entertainment attempts.

material agreement

A filing signed by Cyper-side directors disputes the September 2002 report, saying the cancellation of Cyper's 20,000,000 shares came from a board meeting without proper notice and that the claim of Cyper's default was wrong. It says the Cyper assets remain with the company, Cyper is the majority shareholder, and Duk Jin Jang, John Hyoki Chung and Jason Chung remain in office, with the Quilliam and Hazout appointments declared void. This contradicts the September 2002 rescission and leaves control of the company contested in the filings.

asset acquisition disposition

On September 4, 2002 the company, now named American Entertainment and Animation Corporation, said it rescinded the Cyper acquisition because Cyper failed to provide certain funding needed for public reporting. The 20,000,000 shares issued for Cyper were cancelled, leaving 14,198,649 outstanding, Cyper's directors were removed, and Pierre Quilliam became chairman with 34% of votes. This reverses the April 2002 deal; the company says it is again looking for a reverse merger or acquisition.

asset acquisition disposition

On April 22, 2002 the company bought all of Cyper Entertainment, a Seoul-based 3D animation company, for 20,000,000 restricted shares valued at $0.05 each. Cyper's main shareholder Duk Jin Jang now holds 30% of votes and shares outstanding rise to 30,389,151. This follows the earlier search for a new business after the electric car operations closed; the filing says the company needs to raise financing to operate Cyper, with no guarantee of success.

asset acquisition disposition

The electric car subsidiary, California Electric Automobile Company, gave three electric cars to EFM Venture Group on February 15, 2002 and received a full release from EFM's $12,700 of promissory notes plus $1,250. The filing also says the subsidiary closed its Temecula, California premises because it did not earn enough to meet its obligations, and the company is now seeking a reverse merger or acquisition, with no assurance one will be found.

asset acquisition disposition