Background Continued
The State of Nevada offered the best opportunities for gold and silver exploration and discovery of mines in the United States. Jordan came to this conclusion in 1981 and subsequently relocated to Reno in March of 1983. After reviewing information on about 100 different mine prospects, the Talapoosa Mine property in Lyon County, an advanced exploration property, was selected as a start point. The Talapoosa adjoined the large Asamera property including the Gooseberry Mine.
Both mines are on what some geologists call the "Talapoosa Linament." The area's geology contained many mining districts including the world-famous Comstock in Storey County.
The mining business requires several steps to reach an economic status. Because of high risk, every effort is made to evaluate and select a property considered to be at least partially advanced. In this context, the Talapoosa was selected to pursue for acquisition and financing the overall project.
In addition to research, evaluation, and project selection, Serona was to act as a holding company for Jordan's participation in a number of activities. Building assets and value were long-term goals. As with the established companies, gold and silver ore reserves were sought. Serona also served as a management and services company with the purpose of establishing cash flow. As the first business activity for the company, Serona became manager of the Talapoosa exploration and development project, which also included the project's financing.
ATHENA GOLD CORPORATION
Seed Money Funding:
With loyal, risk-taking, seed-money investors ~ known from many years standing behind him ~ and with his own monies, Jordan negotiated the purchase of the Talapoosa Gold Mine for US$1,060,000. This was a high price tag for a start-up company. From there, he established Athena Gold Corporation after obtaining an offer for funding from principals in Vancouver, British Columbia. The goal was to obtain a preliminary engineering report, go public on the Vancouver Stock Exchange with an Initial Public Offering, fund the Talapoosa near-surface drilling, make payments on the purchase price and ~ with luck ~ build in-ground assets as in commercial grade ore.
Serona Resource Corporation received approximately 1,228,750 shares of Athena Gold's stock. Jordan had an estimated 150,000 shares, rights to options, and other annual benefits. With friends and associates, he and some family members owned controlling interest.
IPO Funding:
The Initial Public Offering for C$475,000 was successful. Monies were forthcoming from brokers within about one month with no problems. Contracting with Dave Allen Drilling of Yerington, Nevada ~ a former longtime employee of Anaconda Mining ~ drilling commenced almost immediately.
A near-surface orebody was discovered and about US$50,000,000 in ground value of possible ore grade material was indicated and appeared "open" on all sides and to depth. About US$900,000 had been invested to this point in the exploration of the Talapoosa. However, Serona Resource Corporation and Jordan were still waiting to be paid for services.
Secondary Funding:
1. The August 10, 1987 Management and Funding Agreement between Serona Resource Corporation and Haywood Securities of Vancouver, B.C.:
Additional funding was needed to advance the drilling on the Talapoosa discovery. An agreement was made between Serona and Haywood on behalf of Athena Gold Corporation. Serona was the largest shareholder in Athena and was its guardian at this time. An amount of C$3,340,000 was to be raised by Haywood.
Syracuse, a Colorado company, had blown a US$920,000 funding of its own and was down to its last US$19,000. It had become a partner with Serona in Athena. Yet, Syracuse was attempting to bankrupt Athena and take over the Talapoosa Mine property for its sole benefit. This would destroy Serona's investment and that of all of its investors, an amount of about US$900,000 in 1987. Syracuse, which started the disturbance, was on a losing course because it refused to recognize the upcoming land payment obligations. Serona and Jordan prevented this from happening; Syracuse became the "Old Group" in the transaction.
An additional 1,530,000 Athena shares were obtained by Serona in the buy-out of Syracuse Minerals. They were part of the funding transaction with Haywood but were subject to terms that required Haywood and any recipients of these cheap shares to fulfill their funding on an "as needed" basis and other obligations. They were allowed as an incentive for Haywood and its "New Group" to fulfill their obligations. A long-form agreement was required but was later refused by Haywood as results from Talapoosa drilling were revealed. These shares were not to be transferred to others unless funding and obligations had been met.
Problems with Haywood began immediately after the August 10, 1987 agreement was signed. Amazingly, Gondi and Scholz managed to change critical sentences on the first pages of this agreement but not on the last page where Jordan's signature was located, a page that displayed only a short, unaltered paragraph! Unknown to Jordan, he and Serona were being victimized with the "Vancouver shuffle." Jordan had notes and other materials that bolstered the terms and obligations of the original agreement. This became quite an argument, remaining to the present day. The agreement required facts and disclosures about the new principals, later called the "New Group."
2.The "New Group":
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