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SHAREHOLDERS' EQUITY
 12 Months Ended
Dec. 31, 2011
SHAREHOLDERS' EQUITY  
SHAREHOLDERS' EQUITY

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NOTE 8 SHAREHOLDERS' EQUITY

  • Common Stock

        On November 30, 2006, shareholders approved an increase in the number of shares reserved under the Company's Equity Incentive Plan (the "Plan") from 5 million to 9 million shares (see Note 9). On January 19, 2012, shareholders approved an increase in the number of shares reserved under the Plan from 9 million to 13.5 million shares (see Note 16).

        On February 24, 2011, the Company sold 17.25 million shares of common stock at a price of $6.50 per share (before the underwriters' commissions and expenses), which includes the exercise of the underwriters' over-allotment option of 2.25 million shares of common stock, in a public offering pursuant to a registration statement filed with U.S securities regulators and a prospectus filed with Canadian securities regulators. Gross proceeds from the 17.25 million shares sold in the offering totaled $112.1 million. Proceeds to the Company, net of commissions and expenses, were approximately $105.4 million.

        On May 19, 2009, the Company sold 25.15 million shares of common stock at a price of $2 per share (before the underwriters' commissions and expenses), which included 3.15 million shares under the underwriters' over-allotment option, in a public offering pursuant to a registration statement filed with U.S. securities regulators and a prospectus filed with Canadian securities regulators. Gross proceeds from the 25.15 million shares sold in the offering totaled $50.3 million with net recorded proceeds to the Company being $46.3 million, which is net of the underwriters' commissions and expenses, legal fees, securities listing costs, printing and other costs.

        On February 22, 2006, the Company completed a private placement of 16.7 million subscription receipts at $4.50 per subscription receipt, from which the Company received $75.15 million in gross proceeds. Effective August 10, 2006, each subscription receipt was converted, for no additional payment, into one share of the Company's common stock and one-half of one common stock purchase warrant. Each whole warrant was exercisable until February 22, 2011 to acquire one additional share of common stock at an exercise price of $10.00. In connection with this private placement, the Company issued compensation options entitling the broker-dealer which acted as the placement agent to acquire, for no additional consideration, broker warrants to acquire up to 1.0 million units at an exercise price of $4.50 per unit until August 22, 2007. Each unit consisted of one share of our common stock and one-half of one warrant. These compensation options were converted into broker warrants contemporaneously with the conversion of the subscription receipts on August 10, 2006. The broker warrants were exercised in 2007. As at December 31, 2010, there were 8.9 million warrants outstanding. All of the warrants expired unexercised on February 22, 2011.

  • Exchangeable Shares and 2007 Acquisitions Related Transactions

        In connection with the 2007 acquisitions, the Company's wholly-owned subsidiary, US Gold Canadian Acquisition Corporation ("Canadian Exchange Co."), issued an aggregate of 43 million exchangeable shares. The exchangeable shares, by virtue of the redemption and exchange rights attached to them and the provisions of certain voting and support agreements, provide the holders with the economic and voting rights that are, as nearly as practicable, equivalent to those of a holder of shares of common stock of the Company.

        Accordingly, remaining exchangeable shares are included as part of the consolidated share capital of the Company. The voting rights associated with the exchangeable shares are exercised by a trustee as the owner of the one outstanding share of the Company's Series A Special Voting Preferred Stock ("Special Voting Share") pursuant to the provisions of a Voting and Exchange Trust Agreement. The Special Voting Share entitles the holder thereof to an aggregate number of votes equal to the number of exchangeable shares of Canadian Exchange Co. issued and outstanding from time to time and which are not owned by US Gold or any subsidiary. Except as otherwise provided by law, the holder of the Special Voting Share and the holders of the Company's common stock vote together as one class on all matters submitted to a vote of shareholders. The holder of the Special Voting Share has no special voting rights, and its consent is not required, except to the extent it is entitled to vote with the holders of shares of common stock for taking any corporate action. Through December 31, 2011, approximately 42.1 million exchangeable shares had been converted into an equivalent amount of common stock of the Company. At December 31, 2011, total outstanding exchangeable shares not exchanged totaled 3.2 million.

        In connection with the 2007 acquisitions, we assumed stock options covering 812,918 shares of our common stock. Following the exercise of 170,125 options during 2007, expiration of 34,500 options during 2008, exercise of 143,625 options during 2010, and exercise of 70,075 options during 2011, a total of 394,593 options remain exercisable at December 31, 2011.