About

OVERVIEW OF THE BUSINESS


The Company was incorporated under the Canada Business Corporations Act on December 5, 2008. The Company did not commence active business operations until it acquired an interest in the Option Agreements (as defined below) from San Gold Corporation ("San Gold") on December 4, 2009. The current business of the Company is the exploration and development of the Properties (as defined below).

As at March 31, 2010, the Company's sole business was the ownership of an interest in the Option Agreements (as defined below). During the quarter ended March 31, 2010, the Company undertook certain limited exploration activities on the Properties.

Previously, on December 4, 2009, the Company entered into an option purchase agreement, as amended, with San Gold (the "Option Purchase Agreement"). Under the terms of the Option Purchase Agreement, San Gold sold to the Company its interest in seven option agreements (the "Option Agreements") to acquire certain mineral properties (the "Properties") in the Timmins, Ontario area. The consideration paid by the Company to San Gold for its interest in the Option Agreements was $2,500,000, satisfied by the issuance by the Company of 19,000,000 common shares of the Company ("Shares") to San Gold at a deemed price of $0.1315789 per Share. In addition to the Shares issued to San Gold, as additional consideration for the interest in the Option Agreements, the Company agreed to enter into a right of first refusal agreement with San Gold which gave San Gold the first right to purchase any interest in a mineral property sold by the Company.

A summary of the obligations of the Company pursuant to the Option Agreements, including the cash payments, Share issuances and work commitments required pursuant to the Option Agreements is contained in the interim financial statements of the Company for the quarter ended March 31, 2010.

During the quarter ended March 31, 2010, the Company undertook limited exploration activities on the Properties. All of the Properties are located in and around the Timmins, Ontario area. A summary of the Properties is set forth below.

The Big Marsh Property
The Big Marsh Property consists of 10 claims or 90 units in the east central part of Carscallen Township extending from Big Marsh Lake to the eastern boundary of the Carscallen Township, the total area being 1,440 hectares. All of the claims are contiguous, forming a relatively equidimensional block approximately 4.0 kilometres wide. The Big Marsh Property is located approximately 25 km to the west-southwest of the core of Timmins, Ontario.

During the quarter ended March 31, 2010, the Company drilled a number of holes on the Big Marsh Property and also undertook geophysical exploration on the Big Marsh Property.
 
 
The Gunther Lake Property
The Gunther Lake Property consists of a single claim of 12 units or 192 hectares in the central part of Carscallen Township to the west of Big Marsh Lake. The Gunther Lake Property forms a rectangular block 1.6 kilometres from north to south and 1.2 kilometres from east to west which is detached from the claim block of the Big Marsh Property by 800 metres and touches the eastern edge of Gunther Lake.
 
 
The Bristol West Property
The Bristol West Property contains four claims consisting of 25 units (400 hectares) along the western edge of Bristol Township. It is contiguous with the Big Marsh Property to the west but has been given a different name to facilitate reference and description. The Bristol West Property's dimensions are 3.0 kilometres from north to south and 1.6 kilometres from east to west.

During the quarter ended March 31, 2010, the Company drilled a number of holes on the Bristol West Property and also undertook geophysical exploration on the Bristol West Property.
 
 
The West Ogden Property
The West Ogden Property consists of two large irregular claims containing 24 units or 384 hectares in the northwest corner of Ogden Township. The aforesaid claims are contiguous forming a rough square approximately 2.5 kilometres across interrupted in the west and center by patented claims which are not part of the West Ogden Property. The West Ogden Property is located approximately 10 km southwest of Timmins, Ontario.
 
 
The Delnor Property
The Delnor Property consists of two claims containing 14 units or 224 hectares in the north central part of Deloro Township. The claims are contiguous forming a rectangular block without the northwest and southeast corners. The dimensions of the Delnor Property are 2.4 kilometres by 1.3 kilometres with the long axis being east-west. The Delnor Property is located approximately 8 kilometres due south of Timmins, Ontario.
 
 
The Lynx Property
The Lynx Property consists of a single claim containing 10 units or 160 Hectares, in the west central part of Deloro Township to the west of McKay Lake. The dimensions of the Lynx Property are 2.4 kilometres from east to west and approximately 800 metres from north to south. The Lynx Property is located approximately 10 kilometres south of Timmins, Ontario.
 
 
The Slade Property
The Slade Property consists of a single claim containing 7 units or 112 hectares in the southeastern quarter of Deloro Township approximately 400 metres from the east boundary of Deloro Township. The claim is irregular in shape and approximately 2.0 km from east to west and an average of 1.0 kilometres from north to south. The Slade Property was acquired by physical staking. The Slade Property is located approximately 10 kilometres to the south-southeast of the core of the city of Timmins, Ontario.
 
 
The Odyssey Property
The Odyssey Property consists of a single claim of six units or 96 hectares in Shaw Township along its western boundary with Deloro Township. It is rectangular in shape with its long axis north-south. Its dimensions are approximately 1.5 kilometres by an average of 600 metres. The Odyssey Property is located approximately 10 km to the southeast of the core of Timmins, Ontario.
 

On January 25, 2010, the Company filed a preliminary non-offering prospectus with The Manitoba Securities Commission in order for the Company to become a reporting issuer in Manitoba and to remove the resale restrictions on the Shares. See "Subsequent Events".

It is the intention of the Company to undertake a substantial exploration program on the Properties in 2010, as set forth in the technical report with respect to the Properties entitled "Technical Report on the Timmins Area Properties for SGX Resources Inc." dated January 15, 2010 prepared by John R. Boissoneault, B.Sc, P.Eng. available on SEDAR at www.sedar.com. The Company also intends to acquire additional mineral properties in the Timmins, Ontario area.

The Company undertook certain limited exploration activities during the quarter ended March 31, 2010. As the Company is in the exploration phase and the Properties are in the early stage of exploration, none of the Properties are in production. Therefore, mineral exploration expenditures are capitalized and losses incurred as a result of administrative expenses relating to the operation of the Company's business. Consequently the Company's net income is not a meaningful indicator of its performance or potential. The key performance driver for the Company is the acquisition and development of prospective mineral properties. By acquiring and exploring projects of superior technical merit, the Company increases its chances of finding and developing an economic mineral deposit.

On April 25, 2010, 2010, the Company filed its final non-offering prospectus with The Manitoba Securities Commission in order to become a reporting issuer and to remove the resale restrictions on the Shares. The Shares became listed for trading on the Exchange on April 28, 2010.

On May 3, 2010, the Company entered into an option agreement with Newcastle Minerals Ltd. ("Newcastle") pursuant to which Newcastle has provided the Company with an option to acquire up to a 75% interest in nine property patents (the "Newcastle Properties") which Newcastle has an option to acquire in the Timmins, Ontario area. Newcastle holds an option to acquire the Newcastle Properties from Timmins Forest Products Ltd. pursuant to an agreement dated December 15, 2009. Pursuant to the terms of the Option Agreement, the Company has the option to earn up to a 75% interest in the Newcastle Properties making certain payments to Newcastle, issuing certain Shares to Newcastle and performing certain exploration work on the Newcastle Properties.

Sothman Lake Property
On May 17, 2010, the Company entered into an option agreement with Shoreacres Exploration Ltd. ("Shoreacres") pursuant to which Shoreacres has provided the Company with an option to acquire a 100% undivided interest in leased claim 114 (the "Shoreacres Property") located in Sothman Township in Timmins, Ontario held by Shoreacres. Pursuant to the terms of this option agreement, the Company has the option to earn a 100% undivided interest in the Shoreacres Property by making certain cash payments and issuing certain Shares to Shoreacres. In addition, upon transfer of a 100% undivided interest in the Shoreacres Property from Shoreacres to the Company, Shoreacres shall be entitled to an aggregate 2% net smelter returns royalty on the Shoreacres Property.
 

On May 19, 2010, the Company entered into an option agreement with each of James Croxall, Margaret Kangas, Dennis Miller, Larry Salo and John D. Bryant (collectively, the "Optionors") pursuant to which the Optionors have provided the Company with an option to acquire a 100% undivided interest in 36 mineral claims (the "Optionor Properties") held by the Optionors in the Timmins, Ontario area. Pursuant to the terms of this option agreement, the Company has the option to earn a 100% undivided interest in the Optionor Properties by making certain cash payments and issuing certain Shares to the Optionors. In addition, upon transfer of a 100% undivided interest in the Optionor Properties from the Optionors to the Company, the Optionors shall be entitled to an aggregate 2% net smelter returns royalty on the Optionor Properties.