RE: RE: Sedars are out
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ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
1
This management discussion and analysis has been prepared as of March 31, 2011 and should be
read in conjunction with the unaudited interim consolidated financial statements of the Company
for the three months ended January 31, 2011 and the subsequent management discussion and
analysis of March 31, 2011. All dollar figures stated herein are expressed in Canadian dollars,
unless otherwise specified.
Description of the Business
The Company is a junior development company, incorporated on October 2nd 1984 under the
Companies Act of British Columbia. On April 8, 2009, under the Company Act of British
Columbia, the Company changed its name from Consolidated Gold Win Ventures Inc. to Encore
Renaissance Resources Corp. (the “Company”). It is engaged in the acquisition of natural
resource properties of potential economic significance on which the Company intends to conduct
exploration and development.
The Company’s interests remain in mining properties that are currently at the exploration stage
and the economic viability of which has not been proven. The Company has not yet determined
whether these unproved mineral interests contain ore reserves that are economically recoverable.
The recoverability of the amounts shown for its unproven mineral interests is dependent upon the
existence of economically recoverable reserves, securing and maintaining title and beneficial
interest in the property, the ability of the Company to obtain necessary financing to complete the
development, and upon future profitable production or proceeds from disposition of the mineral
properties.
The Company is currently focusing its exploration activities on mineral deposits in both Canada
and, primarily in gold in British Columbia, and Yukon, Canada.
Management is continuing to grow the company into a mid-tier gold producer and looks forward
to a great year from our gold operations at the Bonaparte mine located in the interior of British
Columbia.
Unproved Mineral Interests - Highlights:
Pottawatomie - Oklahoma
The Company entered into a Memorandum of Understanding on March 27, 2009 with Nitro
Petroleum Incorporated (“Nitro”), whereby the Company will acquire 12.5% working interest in
oil and gas properties located in Pottawatomie, County, Oklahoma. In consideration, the
Company paid USD $200,000 to Nitro, giving Nitro an option to buy back 12.5% working
interest within 1 year from flowing for $USD 250,000 from the Company. The Company also
paid a finder’s fee of USD $20,000. The option to buy back the 12.5% working interest by Nitro
has now expired.
As of October 30, 2010, the Company received royalty income in the amount of $28,844 to offset
against the development costs. The Company is still in the development stage.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
2
Bonaparte Mine - Kamloops, British Columbia
In June 2009, the Company acquired an option to purchase a 60% interest of the Bonaparte Mine,
property located approximately 35 km north of Kamloops, British Columbia. This was approved
by the TSX on June 26, 2009. On February 9, 2009, the Company entered into an amended
agreement that was approved by the TSX on February 18, 2010. The Company has acquired an
additional 15% interest of Bonaparte Mine; obligations have been amended as follows:
Option Exercise Schedule
Acquisition in
Cash
Acquisition in
Shares
Exploration
expenditures
Aggregate
interest
Phase I: approved by TSX Venture
Exchange on February 18, 2010 - 5,000,000 $1,244,000 25.5%
Phase II: on or before of TSX
approval
$250,000 7,500,000 $225,000 25.5%
Phase II: no specified completion date $1,000,000 10,000,000 - 9%
Phase IV $7,500,000 10,000,000 - 15%
Total $8,750,000 32,500,000 $1,469,000 75%
In May and August of 2009, the Company paid $2,000,000 cash and issued 5,000,000 shares with
a deemed value of $350,000.
On January 4, 2010, the Company paid $5,000,000 cash and on February 26, 2010, the Company
issued 7,500,000 shares with a deemed value of $1,200,000.
As of October 31, 2010, the Company received royalty income in the amount of $149,358 to
offset against the development costs. The Company is still in the development stage.
November 10, 2010, the Company entered into an amended agreement with BCT Mining Corp,
whereby to earn its 75% interest in the Bonaparte Property (the "Property"). The Company has
paid a total of $7,000,000, issue 12,500,000 shares and incurred work costs of at least $3,405,401
and has earned a 51% interest in the Property. In order to earn a 75% interest in the
Property, the Company must pay a further $1,750,000 and issue 20,000,000 shares to BCT. In
consideration of the excess work costs incurred by the Company on the Property, BCT has agreed
to accept the issuance of 20,000,000 shares as the final payment required for the Optionee to earn
a 75% interest in the Property, and, waive the payment of the further $1,750,000.
On December 6, 2010, the Company issued 20,000,000 shares with a deemed value of $3,200,000
and paid one million cash to earn the 75% interest in Bonaparte Property.
The company is currently planning a 10,000 foot drill program. This drill program supports the
company's current underground 10,000 ton bulk sample and provides further information with
respect to the known vein system and also tests for the potential for copper-gold porphyry type
mineralization.
Several high-grade intersections have been encountered in past diamond drilling that include,
113.70 grams Au over a horizontal width of 0.87 meters, 84.21 grams over 1.44 meters, 142.97
grams over 1.2 meters, 321.22 grams over 0.56 meters, 115.41 grams over 1.07 meters, plus a
multitude of other significant intersections. Extensive work is required in order to establish
connectivity between these intersections.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
3
Overall performance
• Capitalized mineral property costs incurred in the period end January 31, 2011 (“fiscal
2011”) totaled $4,581,397 that included 20,000,000 shares issued for the Bonaparte with
a deemed value of $3,200,000). (2010 - $5,922,630).
• General and administrative expenses for the period end January 31, 2011 totaled $94,715
(2010 - $329,267) that included $19,048 of stock based compensation. (2010 - stock
based compensation was $57,492).
• The Company raised $1,392,884 (2010 - $6,028,643) in cash through the issuance of
share capital and from unsecured loan in cash of $273,661 during the past three months.
Cash used in operations was $259,827 (2010 – cash provided by operation was $84,471)
and cash used for investing activities was $1,381,397 (2010 - $5,922,630). At January
31, 2011, the Company had $26,357 in cash and now requires additional financing in
order to continue operations.
Market Trends
The ability of the Company to develop its properties and the future profitability of the Company
is directly related to the market price of the primary minerals identified in its mineral properties.
Mineral prices fluctuate on a daily basis and are affected by a number of factors beyond the
Company’s control. A sustained, significant decline in the price of the primary minerals could
have a negative impact on the Company’s ability to raise additional capital and develop its
projects.
In 2011 & 2010 the price of gold increased, continuing an overall up-trend. The average price of
gold was $1,436 and 1,093 per ounce on March 25, 2011 and 2010, respectively.
Results of Operations
Expenses:
In the period end January 31, 2011, the Company incurred a loss of $94,715 compared to a loss of
$329,267, for the same period in 2010.
Material changes of items in the Statement of Operations for the period end January 31,
2011, as compared to same period of 2010, are as follows:
In General, the costs control program was running very efficiently in the past quarter; most of the
costs were eliminated, especially miscellaneous office expense, telephone and travel.
Rent decreased by 100% due to the rental agreement being terminated.
Consulting fees and investor relations expenses decreased by approximately 94% and 48%
respectively, these were primarily attributable to reduce the costs of related investor relations
campaigns.
Management fees decreased by 47%, due to a management agreement being terminated.
Professional fees increased by 51% due to legal advice on mining acquisition(s).
General mining exploration costs decreased by 100% as the exploration study of Tanzania was
completed in the last year.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
4
Capitalized mineral interest expenditures:
Capitalized unproven mineral interests incurred in the period ended January 31, 2011 totaled
$4,581,397 that included 20,000,000 shares issued for the Bonaparte with a deemed value of
$3,200,000). (2009 - $5,922,630).
The increment in 2011
Additional unproven mineral interests as of January 31, 2011:
Acquisition costs: Pottawatomie Bonaparte Total
Additions: - 4,200,000 4,200,000
Total additional acquisition cast at,
January 31, 2011 - 4,200,000 4,200,000
Exploration Cost
Drilling & exploration costs - 125,000 125,000
Field crew - 6,055 6,055
Field supplies, maintenance & miscellaneous - 237,372 237,372
Property maintenance 12,970 - 12,970
Total additional exploration costs 12,970 368,427 381,397
Total additional unproven mineral interest at January 31, 2011 12,970 4,568,427 4,581,397
Bonaparte Mine - Kamloops, British Columbia
November 10, 2010, the Company went into an amended agreement with BCT Mining Corp,
whereby to earn its 75% interest in the Bonaparte Property (the "Property"). The Company has
paid a total of $7,000,000, issued 12,500,000 shares and incurred work costs of at least
$3,405,401 and has earned a 51% interest in the Property. In order to earn a 75% interest in the
Property, the Company should have paid a further $1,750,000 and issued 20,000,000 shares to
BCT. However, in consideration of the excess work costs incurred by the Company on the
Property, BCT has agreed to accept the issuance of 20,000,000 shares as the final payment
required for the Optionee to earn a 75% interest in the Property and waive the further payment of
$1,750,000.
On December 6, 2010, the Company issued 20,000,000 shares with a deemed value of $3,200,000
and paid one million cash to earn the 75% interest in Bonaparte Property.
The company is planning a 10,000 foot drill program. The Company incurred $125,000 of
drilling preparation costs and spent $237,372 for field supplies for this drill program. In
anticipation of this drill program the Company is negotiating with Mid-Point drilling for a
contract to complete the job. Mid-point has a state of the art, brand new drill that is specifically
designed for drilling in adverse conditions. We look forward to working with them.
Selected Quarterly Results
The following financial information is derived from various audited and interim financial
statements, prepared in accordance with Canadian generally accepted accounting principles
(“GAAP”). While these statements follow the same accounting policies and methods of
application as the January 31, 2011, the unaudited interim consolidated financial statements do
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
5
not contain all the information presented in the annual audited financial statements and should,
therefore, be read in conjunction with the same.
2011
Jan 31
2010
Oct. 31
2010
Jul. 31
2010
Apr. 30
2010
Jan 31
2009
Oct. 31
2009
Jul. 31
2009
Apr. 30
Sales/Interest
Revenue
-- -- -- -- -- -- -- --
Income (Loss)
For Period (94,715) (10,611,486) (261,014) (205,559) (329,267) (266,675) (956,313) (257,930)
Basic and Fully
Diluted Income
(Loss) Per Share
(
.00) (
.06) (
.00) (
.00) (
.00) (
.01) (
.01) (
.01)
The Company does not derive revenue from its operations. Its primary focus is in the acquisition
and exploration of resource properties.
The Income /( Loss) for the period has fluctuated widely, depending on the Company’s activity
level and periodic items that may or may not be incurred in each period, including stock based
compensation, write-downs, and other intermittent items.
During the 3rd quarter ended July 31, 2009, the major increase in net loss was due to write-down
costs for the Yehiniko & Yehiniko GW 1-4 and Reglan mines in the amount of $509,368.
During the 4th quarter ended October 31, 2010, the major increase in net loss was due to writedown
costs for the following: Drybones; Moose Bay; Dolly Varden and the Victoria mines in the
amount of $8,908,673. In addition, the Company also recorded $1,573,395 of stock based
compensation in operating expenses for 18,449,000 of stock options granted to two directors, one
officer and eight consultants for an exercise price of
.10 for a five year period.
Liquidity and Capital Resources
At January 31, 2011, the Company had cash of $26,357 (January 31, 2010: $199,509) and a
working capital deficiency of $794,976 (January 31, 2010: $1,178,011). Net cash reserves and
working capital deficiency decreased as a result of proceeds from share issuances and loan from
financing companies incurred during the past three months. The Company has no commercial
revenue and is therefore dependent on its financing activities to fund its operations.
The Company does not have any cash flow from operations and is unable to generate sufficient
cash to complete current projects without obtaining additional financing. The Company receives
funds for use in its operations primarily from issuing common shares in the Company. This is not
expected to change in the short or medium term.
During the three months ending January 31, 2011:
On November 8, 2010, the Company issued 13,000,000 units for total proceeds of $1,300,000 that
was fully received during September 2010 and October 2010. Each unit consists of one common
share of the Company and one share purchase warrant having a two-year term for the purchase of
one further common share of the Company in the first year the exercise price of
.15 per shares
after first year the exercise price is
.20 per share. Finder’s fees paid consisted of $500 in cash.
On November 19, 2010, the Company issued 13,998,840 shares of common stock to three
directors and four consultants pursuant to the exercise of 13,998,840 stock options for
$1,399,884.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
6
On December 6, 2010, the Company issued 20,000,000 shares as the final payment to acquire
75% interest in the Bonaparte property.
Subsequent to the three months ended January 31, 2011:
On February 16, 2011, the Company obtained $285,000 in financing, the proceeds of which are to
provide working capital and additional funds to support mineral explorations. The loan is due on
demand and non-interest bearing. Shares in the Company equal to 20% of the carrying value of
the loan are to be issued as a financing fee. This loan agreement is subject to regulatory approval.
Off-Balance Sheet Items
The Company does not have any off-balance sheet items.
Related Party Transactions
Unless otherwise stated, the following related party transactions occurred during the normal
course of operations and are measured at the exchange amount, being the amount of consideration
established and agreed to with the related parties.
The Company has an agreement with a director/officer of the Company to provide management
and administrative services for a fee of $2,500 per month. Fees paid or accrued during the three
months ended of January 31, 2011 were $7,500 (2010 - $7,500). The agreement continues for a
year. As of January 31, 2011 a total of $27,500 (2010 – $7,000) was included in accounts payable.
A total of 2,417,156 options were exercised in last quarter for three directors.
Critical Accounting Estimates
The preparation of financial statements in conformity with Canadian generally accepted
accounting principles requires management to establish accounting policies and to make
estimates that affect both the amount and timing of the recording of assets, liabilities and
expenses. Some of these estimates require judgment about matters that are inherently uncertain.
In particular, the recoverability of the recorded value of mineral property costs is dependent upon
many factors beyond the Company’s control, including metal prices, property tenure,
environmental risks, ability to obtain permits, legal and political risks and the Company’s ability
to obtain necessary financing to maintain, explore and develop its mineral properties.
Risk and Uncertainties
Mineral exploration and development involves a high degree of uncertainty and risk. The
Company’s current focus is primarily on the exploration of prospective gold and base metals
properties and the development of such properties to a feasibility or pre-feasibility phase, and is
therefore highly dependent on the raising of risk or venture capital by way of equity issuances to
fund exploration activities. The prospective properties have not yet been determined to contain
economic liberalization. In addition, certain jurisdictions in which the Company operates can be
subject to political disturbance, which may affect the Company’s mineral tenure and access.
Furthermore, the industry is especially dependant on the price of precious and base metals in the
global commodities market. Metals prices affect the ability of the Company to economically
recover any metals or precious gems that may be discovered. This affects the Company’s ability
to raise capital to sustain operations. Strong precious and base metals prices make it substantially
easier for the Issuer to raise funds by way of equity in the capital markets. During the past
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
7
financial year the price of gold and copper has been strong. If this strengthening commodity trend
continues, the Company anticipates that it will be able successfully raise equity to fund all of the
exploration and development activities over the foreseeable future. In addition, the prices of
commodities such as copper, zinc and molybdenum have increased based on the increasing
demand for minerals from Asia, specifically China which is experiencing robust growth. This
atmosphere bodes well for the future outlook of the Company as it currently depends on equity
financing.
Although the Company endeavors to work utilizing environmental Best Management Practices,
changes to environmental regulations can negatively affect the Company’s ability to access,
explore and develop its properties.
Changes in Accounting Policy
New Accounting Standards issued, but not yet adopted
i) International Financial Reporting Standards
In 2006, the Canadian Accounting Standards Board (“AcSB”) published a new strategic plan that
will significantly affect financial reporting requirements for Canadian companies. The AcSB
strategic plan outlines the convergence of Canadian GAAP with IFRS over an expected five year
transitional period. In February 2008 the AcSB announced that 2011 is the changeover date for
publicly-listed companies to use IFRS, replacing Canada’s own GAAP. The conversion date is
for interim and annual financial statements relating to fiscal years beginning on or after January 1,
2011. The Company’s transition date of October 1, 2011 will require a reconciliation of any
significant differences identified and restatement if applicable for comparative purposes of
amounts reported by the Company for the year ended September 30, 2011. The Company has
begun assessing the implications of the change over to reporting under IFRS and had begun the
quantification process of starting the opening IFRS balance sheet. Management plans for
conversion to IFRS to include further internal training, external consulting on complex issues,
Board and Audit Committee oversight and determining what additional qualitative and
supplementary information will be required of the information systems. The conversion plan,
training and assessment process will continue through 2011.
ii) Business Combinations, Non-controlling Interest and Consolidated Financial Statements
In January 2009, the CICA issued Handbook Sections 1582 Business Combinations, 1601
Consolidated Financial Statements and 1602 Non-controlling Interests which replace CICA
Handbook Sections 1581 Business Combinations and 1600 Consolidated Financial Statements.
Section 1582 establishes standards for the accounting for business combinations that is equivalent
to the business combination accounting standard under IFRS. Section 1582 is applicable for the
Company’s business combinations with acquisition dates on or after March 1, 2011. Section 1601
together with Section 1602 establishes standards for the preparation of consolidated financial
statements. Section 1601 is applicable for interim and annual consolidated financial statements
for fiscal years beginning on or after December 1, 2011. Early adoption of these Sections is
permitted and all three Sections must be adopted concurrently. Adoption is not expected to have a
material impact on the company’s financial reporting based on current operations.
Financial Instruments
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
8
The Company follows the accounting standards of CICA Handbook Section 3855, Financial
Instruments – Recognition and Measurement, CICA 3862 Financial Instruments – Disclosures,
and CICA 3863 Financial Instruments - Presentation. Under these standards, all financial
instruments are classified into one of the following five categories: held-for-trading, held-tomaturity,
loans and receivables, available-for-sale financial assets or other financial liabilities.
All financial instruments are measured at fair value as at the balance sheet date except for loans
and receivables, held to maturity investments and other financial liabilities which are measured at
amortized cost. The Company classifies its financial instruments as follow:
• Cash and cash equivalents, reclamation bond and due from related party are classified as
“held-for-trading” and are measured at fair value with any changes in fair value recognized in
earnings of the period.
• Amounts receivable are classified as receivables and are measured at amortized cost which
management has determined approximates their fair value due to their short-term nature.
• Accounts payable and accrued liabilities, loan payable and notes payable are classified as
other financial liabilities and are measured at fair value of which management has determined
approximates their fair value due to their short-term nature.
Fair Value Measurement
The fair values of the Company’s financial assets and liabilities as of January 31, 2011 and
October 31, 2010 were calculated as follows:
January 31,
2011
October 31,
2010
Carrying Carrying Carrying Fair
Value Value Value Value
Financial Asset:
Cash and cash equivalents $ 26,357 $ 26,357 $ 1,036 $ 1,036
Amounts receivable $437,973 $437,973 $388,714 $388,714
Reclamation bond $ 31,056 $ 31,056 $ 31,056 $ 31,056
Financial Liabilities:
Accounts payable and accrued
liabilities $449,266 $449,266 $437,891 $437,891
Notes payable $347,660 $347,660 $ - $ -
Due to related party $889,070 $889,070 $889,070 $889,070
The carrying values of accounts receivable, accounts payable and accrued expenses, notes
payable and loan payable approximate their fair values due to the short-term maturity of these
financial instruments.
Effective October 31, 2009, the Company adopted the CICA amended Section 3862, Financial
Instruments - Disclosures, to include additional disclosure requirements about fair value
measurement for financial instruments and liquidity risk disclosures. These amendments require
disclosure of the three-level hierarchy that reflects the significance of the inputs used in making
the fair value measurements. The three levels of fair value hierarchy based on the reliability of
inputs are as follows:
Level 1 - inputs are quoted prices in active markets for identical assets and liabilities;
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
9
Level 2 - inputs are based on observable market data, either directly or indirectly other than the
quoted prices; and
Level 3 - inputs are not based on observable market data.
In the table below, the Company has segregated all financial assets and financial liabilities that
are measured at fair value into the most appropriate level within the fair value hierarchy, based on
the inputs used to determine the fair value at the measurement date. The Company has no
financial assets or financial liabilities measured using level 2 or level 3 inputs.
Financial assets measured at fair value as at January 31, 2011 and October 31, 2010 in the
consolidated financial statements are summarized below. The Company has no financial
liabilities measured at fair value.
January 31, 2011
Level 1 Level 2 Level 3 Total
Cash and cash equivalents $ 26,357 - - $ 26,357
Reclamation bond $31,056 - - $31,056
October 31, 2010
Level 1 Level 2 Level 3 Total
Cash and cash equivalents $ 1,036 - - $ 1,036
Reclamation bond $31,056 - - $31,056
Credit risk
Credit risk reflects the risk that the Company may be unable to fulfill its payment obligations and
is primarily attributable to its cash balance. Cash is held with a reputable Canadian financial
institution, from which management believes the risk of loss to be minimal.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as
they come due or can do so only at excessive cost. The Company has significant financial
liabilities outstanding including accounts payable and accrued liabilities and loan payable. The
Company is exposed to the risk that it may not have sufficient liquid assets to meet its
commitments associated with these financial liabilities. To the extent that the Company does not
believe it has sufficient liquidity to meet these obligations, management will consider securing
additional funds through equity transactions.
Market Risk
i) Currency Risk
Currency risk is the risk that the value of financial instruments will fluctuate due to changes in
foreign exchange rates. The Company’s mineral properties are located in the United States
(“US”) with the majority of related expenditures being conducted in US currency. The Company
is exposed to moderate currency risk as a result of fluctuations in the US dollar.
ii) Interest Rate Risk
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in
market interest rates. Interest rate risk is minimal as the Company does not have any interest
bearing assets or any interest bearing liabilities that are tied into market rates.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
10
Commodity Price Risk
The ability of the Company to finance the exploration and development of its properties and the
future profitability of the Company is directly related to the market price of the primary minerals
identified in its mineral properties. Mineral prices fluctuate on a daily basis and are affected by a
number of factors beyond the Company’s control. A sustained, significant decline in the prices of
the primary minerals could have a negative impact on the Company’s ability to raise additional
capital. Sensitivity to price risk is remote since the Company has not established any reserves or
production.
Outstanding Share Data at March 29, 2011:
(a) Authorized Capital – unlimited common shares without par value
(b) Issued and Outstanding Capital as of March 29, 2011: 265,481,077 shares outstanding
(c) Stock Options Outstanding at March 29, 2011:
Price Outstanding
(Forfeited)/
(Expired)/ Outstanding
Expiry ($) 31-Oct-10 Granted Exercised 29-Mar-11
27-Jun-12 0.1 25,000 - (25,000) -
2-Jun-13 0.1 119,390 - (119,390) -
20-Feb-14 0.1 109,450 - (109,450) -
24-Jul-14 0.1 3,145,000 - (3,145,000) -
14-Sep-15 0.1 18,449,000 - (10,600,000) 7,849,000
21,847,840 - (13,998,840) 7,849,000
(d) Share Purchase Warrants Outstanding at March 29, 2011:
Price Outstanding (Expired) / Outstanding
Expiry Type ($) 31-Oct-10 Granted Exercised 29-Mar-11
29-01-14 NFT 0.05 / 0.10(i) 2,000,000 - - 2,000,000
29-01-14 AW* 0.1 640,167 - - 640,167
16-06-11 NFT 0.15 3,750,000 - - 3,750,000
12-Dec-10 NFT 0.5 12,500,000 (12,500,000) - -
8-Nov-15 NFT 0.15 / 0.20(ii) 13,000,000 13,000,000
18,890,167 500,000 - 19,390,167
NET – Non flow through shares
* Agent’s warrants
i). The exercise price of these warrants is
.05 in the first year and
.10 for the remaining four years.
ii).The exercise price of these warrants is
.15 in the first year and
.20 for the remaining four years.
Subsequent Events
On February 16, 2011, the Company obtained $285,000 in financing, the proceeds of which are to
provide working capital and additional funds to support mineral explorations. The loan is due on
demand and non-interest bearing. Shares in the Company equal to 20% of the carrying value of
the loan are to be issued as a financing fee. This loan agreement is subject to regulatory approval.
Outlook
The Company is continuing its exploration efforts and with assistance from its venture partners is
proceeding in a positive fashion.
ENCORE RENAISSANCE RESOURCES CORP.
Management Discussion and Analysis
For the Period Ended January 31, 2011
11
Disclosure Controls
Management has designed disclosure controls and procedures, or has caused them to be designed
under its supervision, to provide reasonable assurance that material information relating to the
Company, is made known to management by others within the Company, particularly during the
period in which the annual filings are being prepared.
Management has also designed such internal controls over financial reporting, or caused it to be
designed under management’s supervision, to provide reasonable assurance regarding the
reliability of financial reporting and preparation of the unaudited interim financial statements for
the period ended January 31, 2011 in accordance with Canadian generally accepted accounting
principles (“GAAP”). Canadian GAAP has become very complex and, as a venture issuer, the
Company has limited personnel and resources. Therefore, despite management’s efforts, there is
a risk that interim financial statements may not conform to Canadian GAAP.
There has been no change in the Company’s disclosure controls and procedures or in the
Company’s internal control over financial reporting that occurred during the most recently
completed quarter that has materially affected, or is reasonably likely to materially affect, the
Company’s disclosure controls and procedures or internal control over financial reporting.
Addition Information
Additional information related to the Company is available on SEDAR’s website at
‘www.sedar.com’.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in the foregoing Management’s Discussion and Analysis and
elsewhere constitute forward-looking statements. Such forward-looking statements involve a
number of known and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such forward-looking statements.
Readers are cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth above.