-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, V/ppzQR7VSo6vjbI80MeEUHWebtx3l0/JpE/NLGxUjJg0S7pxRt3qcMDv4IW3lns bFFw8CLmnjzvMyQ/Qt+tuA== 0001137171-04-000385.txt : 20040401 0001137171-04-000385.hdr.sgml : 20040401 20040401131450 ACCESSION NUMBER: 0001137171-04-000385 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040331 FILED AS OF DATE: 20040401 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KIRKLAND LAKE GOLD INC CENTRAL INDEX KEY: 0001104440 STANDARD INDUSTRIAL CLASSIFICATION: GOLD & SILVER ORES [1040] IRS NUMBER: 000000000 STATE OF INCORPORATION: A1 FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-49919 FILM NUMBER: 04708753 BUSINESS ADDRESS: STREET 1: SUITE 300 STREET 2: 570 GRANVILLE STREET CITY: VANCOUVER BC STATE: A1 ZIP: V6C 3P1 BUSINESS PHONE: 6046891428 MAIL ADDRESS: STREET 1: SUITE 300 STREET 2: 570 GRANVILLE STREET CITY: VANCOUVER BC STATE: A1 ZIP: V6C 3P1 FORMER COMPANY: FORMER CONFORMED NAME: FOXPOINT RESOURCES LTD DATE OF NAME CHANGE: 20000128 6-K 1 kirk6k0331.htm Filed By Filing Services Canada Inc. 403-717-3898

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C., 20549


FORM 6-K


Report of Foreign Issuer




FOR PERIOD ENDED

March 31, 2004


COMMISSION FILE NUMBER:

01-31380



KIRKLAND LAKE GOLD INC.



Suite 300, 570 Granville Street

Vancouver, British Columbia

Canada, V6C 3P1


(Address of principal executive offices)



Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.   



Form 20-F

  X

 

Form 40-F

  



Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.  



Yes

  

 

No

  X



If "Yes" is marked indicate the file number assigned to the registrant in connection with Rule 12g3-2(b): 82 - .


 

 

 

 

 

 

KIRKLAND LAKE GOLD INC.

UNAUDITED INTERIM FINANCIAL STATEMENTS

 NINE MONTH PERIOD ENDED JANUARY 31, 2004

 (EXPRESSED IN CANADIAN DOLLARS)

 

 

 

 

 

 

 


NOTICE TO READER

We have compiled the balance sheet of Kirkland Lake Gold Inc. as at January 31, 2004 and the statements of operations and deficit and cash flows for the period then ended from information provided by management. We have not audited, reviewed or otherwise attempted to verify the accuracy or completeness of such information. In addition to the preparation of quarterly financial statements Ross, Pope & Company also provides payroll services to Kirkland Lake Gold Inc. Readers are cautioned that these statements may not be appropriate for their purposes.

 

 

Kirkland Lake, Ontario 

March 4, 2004

ROSS, POPE & COMPANY 

CHARTERED ACCOUNTANTS

 

 

 

 

 

 


KIRKLAND LAKE GOLD INC.              
BALANCE SHEETS (UNAUDITED)              
               
AS AT JANUARY 31, 2004 AND APRIL 30, 2003              
               
(EXPRESSED IN CANADIAN DOLLARS)              







 
    JANUARY 31     APRIL 30  
     2004     2003  
Assets              
               
Current assets              
Cash and cash equivalents   $ 9,055,708   $ 3,664,607  
Short-term investments     190,000     190,000  
Accounts receivable     564,406     313,168  
Inventories (Note 3)     1,590,182     583,290  
Prepaid expenses and deposits     407,716     444,220  
   




 
      11,808,012     5,195,285  
               
Deferred finance charges (Note 7)     519,367     6,250  
Mineral properties (Note 4)     12,418,174     8,117,495  
Property, plant and equipment (Note 5)     8,999,236     5,971,094  
Mine closure bonds     2,043,435     2,043,435  
   




 
    $ 35,788,224   $ 21,333,559  
   




 
               
Liabilities              
               
Current liabilities              
Accounts payable and accrued liabilities   $ 5,761,273   $ 3,464,472  
Current portion of notes payable (Note 6)     -     1,926,849  
Convertible loans (Note 7.a)     2,187,500     2,176,622  
   




 
      7,948,773     7,567,943  
               
Convertible loans (Note 7.b)     870,373     -  
Provision for reclamation and site restoration     2,043,435     2,043,435  
   




 
      10,862,581     9,611,378  
   




 
Shareholders' Equity              
Capital stock (Note 8)              
Authorized              
Unlimited common shares without par value              
Issued              
33,365,589 (April 30, 2003 - 24,076,166) common shares   41,459,812     17,757,582  
Options (Note 9)     153,266     112,362  
Warrants (Note 10)     4,370,247     696,270  
Equity component of convertible loans (Note 7)     271,839     82,728  
Contributed surplus (Note 7.a)     18,010     18,010  
Deficit     (21,347,531)     (6,944,771)  
   




 
      24,925,643     11,722,181  
   




 
    $ 35,788,224 $ 21,333,559  
   




 
Nature of operations and going concern (Note 1)              
Subsequent events (Note 14)              
Approved by the Board of Directors:              
               
(signed) "Brian E. Bayley" Director    (signed) "S. Paul Kostuik" Director        
               
               
               
               
See accompanying notes to interim financial statements.              

KIRKLAND LAKE GOLD INC.              
STATEMENTS OF OPERATIONS AND DEFICIT (UNAUDITED)              
               
PERIODS ENDED JANUARY 31, 2004 AND 2003              
               
(EXPRESSED IN CANADIAN DOLLARS)              
  THREE MONTH   THREE MONTH   NINE MONTH   NINE MONTH  
  PERIOD ENDED   PERIOD ENDED   PERIOD ENDED   PERIOD ENDED  
  JANUARY 31     JANUARY 31   JANUARY 31     JANUARY 31  
    2004     2003     2004     2003  
                         
Mining revenue $ 3,390,189   $ 2,153,418   $ 5,694,722   $ 10,227,413  
Operating costs   6,480,161     2,860,858     15,699,300     7,899,138  
Amortization and depletion   368,610     174,089     875,729     499,786  
 










 
Operating income (loss)   (3,458,582)     (881,529)   (10,880,307)     1,828,489  
 









 
                         
General and administrative   458,107     328,315     1,225,952     1,065,492  
Royalties   98,325     45,867     144,275     206,827  
Exploration   1,293,548     551,176     1,586,957     1,779,769  
Amortization of finance charges   195,310     61,265     234,696     158,679  
Interest and bank charges   252,380     148,624     372,440     461,908  
Foreign exchange loss   861     -     3,983     -  
Interest and other income   (16,064)     (15,105)     (45,851)     (49,810)  
 










 
    2,282,467     1,120,142     3,522,452     3,622,865  
 










 
Loss for the period   (5,741,049)     (2,001,671)     (14,402,759)     (1,794,376)  
Deficit - beginning of period   (15,606,482)     (1,802,498)     (6,944,772)     (2,009,793)  
                         
Deficit - end of period $ (21,347,531)   $ (3,804,169)   $ (21,347,531)   $ (3,804,169)  
 










 
                         
Basic and diluted loss per share $ (0.19)   $ (0.10)   $ (0.51)   $ (0.09)  
 










 
                         
Basic and Diluted Weighted                        
Average number of shares                        
outstanding   30,278,313     20,139,131     28,311,346     19,204,491  
 










 

See accompanying notes to interim financial statements.


KIRKLAND LAKE GOLD INC.                    
STATEMENT OF CASH FLOWS (UNAUDITED)                    
                         
PERIODS ENDED JANUARY 31, 2004 AND 2003                    
                         
(EXPRESSED IN CANADIAN DOLLARS)                      











 
  THREE MONTH   THREE MONTH     NINE MONTH   NINE MONTH  
  PERIOD ENDED   PERIOD ENDED   PERIOD ENDED   PERIOD ENDED  
    JANUARY 31     JANUARY 31     JANUARY 31     JANUARY 31  
    2004     2003     2004     2003  
   Cash flows from operating                        
   activities                        
   Loss for the period $ (5,741,049)   $ (2,001,671)   $ (14,402,759)   $ (1,794,376)  
      Items not affecting cash                        
         Amortization and depletion   368,610     174,089     875,729     499,786  
         Accretion of interest and finance                        
            charges   238,176     146,740     378,208     456,005  
         Stock-based compensation   32,803     3,568     64,330     11,587  
   Changes in non-cash working capital                        
   items                        
      Accounts receivable   (259,291)     479,182     (251,238)     (360,874)  
      Inventories   (64,174)     506,779     (1,006,892)     (827,691)  
      Prepaid expenses and deposits   (285,172)     (342,169)     36,504     (318,925)  
      Accounts payable and accrued                        
         liabilities   (262,159)     547,607     1,606,080     2,053,705  
 










 
    (5,972,256)     (485,875)     (12,700,038)     (280,783)  
 










 
   Cash flows from financing activities   -     -     -     -  
      Net proceeds from issuance of                        
         capital stock   16,031,135     4,432,115     26,604,968     6,813,524  
      Proceeds from issuance of                        
         convertible loans   -     -     1,000,000     2,500,000  
      Finance charges   -     -     -     (25,000)  
      Payment of notes payable and                        
         convertible loans   (1,000,000)     (1,000,000)     (2,000,000)     (3,312,500)  
 










 
    15,031,135     3,432,115     25,604,968     5,976,024  
 










 
   Cash flows applied to investing                        
   activities                        
      Purchase of property, plant and                        
      equipment   (1,187,236)     (10,634)     (3,146,869)     (745,034)  
      Additions to mineral properties   (1,101,328)     (2,065,432)     (4,366,960)     (4,295,733)  
 










 
    (2,288,564)     (2,076,066)     (7,513,829)     (5,040,767)  
 










 
   Increase in cash and cash                        
   equivalents   6,770,315     870,174     5,391,101     654,474  
   Cash and cash equivalents -                        
   Beginning of period   2,285,393     3,453,690     3,664,607     3,669,390  
 










 
   Cash and cash equivalents - End of                        
   period $ 9,055,708   $ 4,323,864   $ 9,055,708   $ 4,323,864  
 










 

Supplemental cash flow information (Note 13)

See accompanying notes to interim financial statements.


KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

1. NATURE OF OPERATIONS AND GOING CONCERN

Kirkland Lake Gold Inc. (the company) owns gold mining and milling operations in Kirkland Lake, Canada, which were inactive when acquired in December 2001 and have been placed back into production. The continued operations of the company are dependent upon the existence of sufficient economically recoverable reserves, the ability of the company to obtain financing as required to sustain the development, and upon future profitable production.

At January 31, 2004, the company had working capital of $3,859,239 and commitments to spend $6,661,000 on exploration under a previous flow through financing. Management believes that funds from operations and other sources of financing will be sufficient to meet the company's obligations for the coming year. The company has plans to raise additional financing to meet it's obligations and while the company has been successful in obtaining financing in the past, there can be no assurance that it will be able to do so in the future.

The company's ability to continue as a going concern is dependent on future financings until the attainment of profitable and cash-generating operations sufficient to sustain the company. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary, should the company be unable to continue as a going concern.

2. SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited interim financial statements are prepared in accordance with generally accepted accounting principals ("GAAP") in Canada. They do not include all of the information and disclosures required by Canadian GAAP for annual audited financial statements. In the opinion of management, all adjustments considered necessary for fair presentation have been included in these financial statements. The interim financial statements should be read in conjunction with the company's financial statements including the notes thereto for the year ended April 30, 2003.

3. INVENTORIES

           
             
  JANUARY 31     APRIL 30  
  2004     2003  
 



 
             
Mine operating supplies $ 491,671   $ 74,802  
Dore bars   302,308     -  
Gold in process   796,203     508,488  
 




 
  $ 1,590,182   $ 583,290  
 




 

KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

4. MINERAL PROPERTIES

  JANUARY 31     APRIL 30  
  2004     2003  
 




 
Balance - Beginning of period $ 8,117,495   $ 2,037,369  
             
Additions:            
Rehabilitation and development costs   4,300,679     6,188,717  
Depletion   (208,415)     (108,591)  
 




 
Balance - End of period $ 12,418,174   $ 8,117,495  
 




 
             
Balances, net of depletion are as follows:            
  JANUARY 31     APRIL 30  
    2004     2003  
 




 
Acquisition allocation $ 772,879   $ 795,674  
Underground development   8,742,164     4,412,246  
Underground pumping   1,915,357     1,917,522  
Mill and surface facilities rehabilitation   145,092     149,371  
Lakeshore underground access ramp   842,682     842,682  
 




 
  $ 12,418,174   $ 8,117,495  
 




 

5.  PROPERTY, PLANT AND EQUIPMENT

        JANUARY 31 2004        
        ACCUMULATED        
    COST   AMORTIZATION     NET  
 






 
                   
Computer equipment $ 143,794   $ 62,131   $ 81,663  
Mine and mill equipment   10,346,953     1,490,660     8,856,293  
Vehicles   78,142     16,862     61,280  
 






 
  $ 10,568,889   $ 1,569,653   $ 8,999,236  
 






 
                   
        APRIL 30, 2003        
        ACCUMULATED        
    COST   AMORTIZATION     NET  
 






 
                   
Computer equipment $ 115,359   $ 29,040   $ 86,319  
Mine and mill equipment   6,712,710     865,971     5,846,739  
Vehicles   45,364     7,328     38,036  
 






 
  $ 6,873,433   $ 902,339   $ 5,971,094  
 






 

KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

6. NOTES PAYABLE

The company signed notes payable in connection with the acquisition of the mineral property and mining assets in Kirkland Lake, Ontario . The notes are non-interest bearing and are payable on the following dates:

        JANUARY 31     APRIL 30  
    Principal   2004     2003  
 






 
June 11, 2002 (paid) $ 1,000,000

 $

 - $   -  
June 14, 2002 (paid)   1,000,000   -     -  
December 13, 2002 (paid)   1,000,000   -     -  
June 11, 2003 (paid)   1,000,000   -     988,493  
December 13, 2003 (paid)   1,000,000   -     938,356  
 






 
     

 $

 - $   1,926,849  
 






 

The non-interest bearing notes were discounted at 10% per annum, which is estimated to be consistent with similar borrowings which would have been available to the company.

JANUARY 31     APRIL 30  
2004     2003  




 

Balance - Beginning of period

$ 1,926,849   $ 4,641,370  
           

Acquisition

  -     -  
Accretion of interest    73,151     285,479  
Less: payments   (2,000,000)     (3,000,000)  





 

 Balance - End of period

$ -   $ 1,926,849  





 

7. CONVERTIBLE LOANS

(a) On June 11, 2002, the company completed loan financing of $2,500,000. The loans have a term of one year (expiring June 11, 2004), which have been extended for one year at the company's option (see below), and bear interest at the rate of 10% per year.

The principal amount of the loans are conv ertible at the lenders' option into special warrants at the rate of $4.00 per special warrant and the accrued interest is convertible into special warrants at the rate equal to the higher of $4.00 per special warrant or the then market price of the company's shares. Each special warrant, including those issued as a bonus, is convertible into one common share of the company.

The company has determined the value of the equity conversion feature of the convertible loans to be $94,546 using the Black-Scholes option pricing model. The remainder of $2,405,454 was classified as debt.

During the year ended April 30, 2003, the company redeemed part of the convertible loans with a face value of $312,500.


KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

7. CONVERTIBLE LOANS (CONT'D)

As a result of the redemption $11,818 of the value of the equity conversion feature of the convertible loans was transferred to contributed surplus leaving a balance of $82,728 as the equity component of convertible loans.

On December 5, 2003, the lenders received 109,375 common shares, at a fair value of $4.78, to extend the maturity date of the $2,187,500 note payable to June 11, 2004. The fair value of the shares has been recorded as finance charges of $522,813 and will be amortized over the remaining term of the loan.

(b) On August 11, 2003, the company completed a loan financing of $1,000,000. The loan has a term of eighteen months (expiring February 11, 2005), which can be extended for eighteen months at the company's option (see below), and bears interest at the rate of 10% per year.

The principal amount of the loan is convertible at the lenders' option into common shares at the rate of $4.00 per common share and the accrued interest is convertible into common shares at the rate equal to the higher of $4.00 per common share or the then market price of the company's shares. If the loan is converted or repaid before the first anniversary date of the closing in August 2003, the lenders shall receive one year's worth of interest (excluding interest converted into shares) on the original loan amount.

The company has determined the value of the equity conversion feature of the convertible loans to be $189,111 using the Black-Scholes option pricing model. The remainder of $810,889 was classified as debt.

On August 11, 2003 the lender received an aggregate of 75,000 common shares at $3.00 per common share, as a bonus for making the loans, which have been determined to have a fair value of $225,000 and will be amortized over the initial term of the loan.

At the company's option, the maturity date of the loan may be extended 18 months by the issuance of 75,000 common shares. The common shares, when issued, will be subject to a four month hold period from issuance of such common shares. If the loan is redeemed by the company within the first or second 18 month term, the lender shall also receive warrants to purchase that number of common shares equal to 0.2875 times the amount of unpaid principal. The warrants would be exercisable at $4.00 per share until the next 18 month anniversary of the loan.

(c) A summary of deferred finance charges incurred and amortization during the period is shown below.

 

  JANUARY 31   JANUARY 31  
  2004   2003  
 


 
Balance - Beginning of period $ 6,250   $ -  
             
Finance charges incurred   747,813     243,266  
Less: amortization   (234,696)     (158,679)  
 


 
Balance - End of period $ 519,367   $ 84,587  
 


 

KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

8. CAPITAL STOCK

  Number of     Stated  
  shares     value  
 



 
Balance - May 1, 2003 24,076,166   $ 17,757,582  
           
Issued for cash          
   Exercise of options 490,100     717,561  
   Exercise of warrants 734,948     1,538,085  
   Common shares issued 8,064,375     26,790,813  
   Share proceeds allocated to warrants -     (3,810,043)  
   Share issuance costs -     (1,534,186)  
 



 
Balance - January 31, 2004 33,365,589   $ 41,459,812  
 



 

(a) On August 8, 2003, the company closed the first of two tranches of a private placement of 3,755,000 units. In the first tranche, the company sold 3,554,000 units at $2.60 per unit to raise gross proceeds of $9,240,400. On August 26, 2003, the company closed the second tranche and sold 201,000 units at $2.60 per unit to raise gross proceeds of $522,600. Each unit consisted of one common share and one-half of a share purchase warrant. Each whole warrant will entitle the holder to purchase a further common share for a period of two years (expiring August 26, 2005) at a price of $3.00 per share. The company incurred commissions, fees and legal costs totalling $538,080 in connection with this placement. The share purchase warrants issued as part of this placement have been recorded at a fair value of $2,150,084.

(b) On November 14, 2003, the company completed it's "Flow Through" financing, raising $7,700,000 through the sale of 1,925,000 shares at $4.00 per share (including a 10% over-allotment option which was exercised by the Agents). The proceeds from the financing are being used to fund further exploration expenses on the company's Kirkland Lake, Ontario, mining properties, which expenses shall qualify as "Canadian Exploration Expenses" under the Income Tax Act (Canada). A fee of 5% of the proceeds raised was paid to the Agents. The company also issued the Agents compensation warrants to purchase that number of common shares equal to 5% of the Shares sold, which options are exercisable for a period of 24 months (expiring November 14, 2005) at a price of $3.60 per share. All shares issued and issuable will be subject to restrictions on resale for a period of four months from closing. The company incurred commissions, fees and legal costs totalling $430,499 in connection with this placement. The comp ensation warrants issued as part of this placement have been recorded at a fair value of $158,788.

(c) The company completed on December 2, 2003 a private placement of 2,200,000 units at a price of $3.90 per unit for gross proceeds of $8,580,000. Each unit consisted of one common share and one-half of a share purchase warrant. Each whole warrant is exercisable for a period of 18 months (expiring June 1, 2005) at a price of $4.40 per share. Two family trusts, the beneficiaries of which are the spouse and sister of the company's Chairman, D. Harry W. Dobson, subscribed for over 50% of the placement. The company incurred commissions, fees and legal costs totalling $406,819 in connection with this placement. The share purchase warrants issued as part of this placement have been recorded at a fair value of $1,659,959.

(d) On December 5, 2003, the company issued 109,375 common shares, at a fair value of $4.78 per common share, to extend the maturity date of the $2,187,500 note payable to June 11, 2004 (Note 7.a).

(e) On August 11, 2003 the company issued 75,000 common shares at a fair value of $3.00 per common share, as a bonus on the $1,000,000 convertible loan financing (Note 7.b).


KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

9. OPTIONS

The company has adopted a stock option plan. The plan allows the company to grant options to directors, senior officers and employees of or consultants to the company and its subsidiaries or employees of a corporation providing management services to the company. The aggregate number of shares which may be subject to issuance pursuant to options granted under this Plan is 930,000 Shares (which, for clarification, is less than 10% of the then 21,763,027 Shares issued and outstanding after deducting the 1,245,500 Shares subject to issuance pursuant to options granted before the establishment of this Plan and which have not been rolled over into and become subject to this Plan).

Stock options issued to officers, directors, employees and consultants are as follows:

        Weighted  
  Number of     average  
  shares     exercise price  
 



 
Options outstanding - May 1, 2003 1,735,000   $ 1.65  
Granted 327,500     3.68  
Exercised (490,100)     1.42  
Forfeited (20,000)     2.20  
 



 
Options outstanding - January 31, 2004 1,552,400   $ 2.15  
 



 
           
Options exercisable - January 31, 2004 880,150   $ 1.62  
 



 

The following table summarizes information about stock options outstanding and exercisable at January 31, 2004:

                Outstanding   Exercisable  
                options   options  
                weighted   weighted  
                average   average  
        Options   Options   remaining life   remaining life  

Exercise price

  outstanding   exercisable   (years)   (years)  









 
  $ 1.10   200,000   200,000   2.15   2.15  
    1.35   329,400   329,400   2.68   2.68  
    1.60   101,000   21,000   3.19   3.19  
    2.05   35,000   35,000   3.31   3.31  
    2.20   534,500   259,750   3.95   3.95  
    2.45   35,000   35,000   3.35   3.35  
    2.80   67,500   -   4.54   -  
    3.95   250,000   -   4.82   -  











 
$ 1.10 - $3.95   1,552,400   880,150   3.54   3.00  










 

The company grants all employee stock options with an exercise price equal to the market value of the underlying common shares on the date of grant. Accordingly, under the intrinsic value method, no compensation expense has been recognized on the employee stock option in the statements of operations. If compensation costs for all grants under the employee stock option plan had been determined by the fair value method, net income and earnings per share would have been as follows:


KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

9. OPTIONS (CONT'D)

  THREE MONTH   THREE MONTH     NINE MONTH   NINE MONTH  
  PERIOD ENDED   PERIOD ENDED   PERIOD ENDED   PERIOD ENDED  
  JANUARY 31   JANUARY 31   JANUARY 31   JANUARY 31  
    2004     2003     2004     2003  
 










 
Loss                        
As reported $ (5,741,049)   $ (2,001,671)   $ (14,402,759)   $ (1,794,376)  
Pro forma $ (5,940,082)   $ (2,021,374)   $ (14,710,749)   $ (1,890,198)  
Loss per share                        
As reported $ (0.19)   $ (0.10)   $ (0.51)   $ (0.09)  
Pro forma $ (0.21)   $ (0.10)   $ (0.56)   $ (0.10)  

The fair value of each option at the date of grant was estimated using the Black-Scholes option-pricing model with the following assumptions:

  JANUARY 31     APRIL 30  
  2004     2003  
 



 
Expected life of options   5 years     5 years  
Risk-free interest rate   3 - 5%     3 - 5%  
Expected stock price volatility   70%     70%  
Expected dividend yield   0%     0%  
Weighted-average fair value of options $ 2.19   $ 2.18  

Option pricing models require the input of highly subjectiv e assumptions including the expected price volatility. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore, the existing models do not necessarily provide a reliable measure of the fair value of the company's stock options.

For the nine months ended January 31, 2004, the value of stock options granted to non-employees is $64,330. The fair value of these options is estimated using the Black-Scholes option pricing model.

The value ascribed to unexercised options recorded as a component of shareholders' equity is as follows:

  JANUARY 31     APRIL 30  
  2004     2003  
 
   
 
Balance - Beginning of period $ 112,362   $ 128,168  
             
Options granted to non-employees   64,330     22,133  
Exercise of options   (23,426)     (31,747)  
Options forfeited   -     (6,192)  
   
   
 
Balance - End of period $ 153,266   $ 112,362  
 

 
 

KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

10. WARRANTS

The changes in warrants outstanding are as follows:

            Weighted  
            average  
    Number of   exercise  
    shares   price  
   


 
Warrants outstanding - May 1, 2003   1,721,823 $   1.63  
Granted   3,073,749     3.52  
Exercised   (734,948)     1.69  
   



 
Warrants outstanding - January 31, 2004   4,060,624 $   3.09  
   



 
                 
The value ascribed to unexercised warrants recorded as a component of shareholders' equity is  
as follows:                
  JANUARY 31     APRIL 30  
    2004      

2003 

 





Balance - Beginning of period $ 696,270   $   1,044,040  
                 
Unit proceeds allocated to warrants   3,810,043       315,211  
Warrants issued as bonus on issuance of convertible loans   -       218,266  
Agents warrants issued in private placement (Note 8.b)   158,788       -    
Exercise of warrants   (294,854)       (881,247)  
 





 
Balance - End of period $ 4,370,247   $   696,270  
 





 

11. RELATED PARTY TRANSACTIONS

The following related party transactions occurred during the period:

During the nine months ended January 31, 2004 the company paid office facilities and administration services in the amount of $31,500 (2003 - $39,000) to a company related by directors in common.

These transactions were in the normal course of operations and were measured at the exchange value which represented the amount of consideration established and agreed to by the related parties.

12. SEGMENTED INFORMATION

The company has one operating segment consisting of a mining and milling operation located in Kirkland Lake, Canada. During the periods ended January 31, 2004 and 2003 all of the company's capital assets and operations were in Canada.


KIRKLAND LAKE GOLD INC.

NOTES TO INTERIM FINANCIAL STATEMENTS (UNAUDITED) 

NINE MONTHS ENDED JANUARY 31, 2004 

(EXPRESSED IN CANADIAN DOLLARS)

13. SUPPLEMENTAL CASH FLOW INFORMATION

During the three and nine month periods ended January 31, 2004 and 2003, the company conducted non-cash financing and investing activities as follows:

          THREE MONTH THREE MONTH NINE MONTH NINE MONTH  
          PERIOD ENDED PERIOD ENDED PERIOD ENDED PERIOD ENDED  
          JANUARY 31 JANUARY 31   JANUARY 31 JANUARY 31  
          2004 2003   2004 2003  
         




 
Warrants issued as share   $ 158,788 $ -   $ 158,788 $ 315,211  
issuance costs                          
Warrants issued as convertible   $ - $ -   $ - $ 218,266  
loans financing costs                          
Stock-based compensation $ 32,803 $ 3,496 $ 64,330 $ 11,587

 

14.  SUBSEQUENT EVENTS

On March 3, 2004 750,000 warrants were exercised at $1.60 per warrant.  The company received gross proceeds of $1,200,000.


 

SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



KIRKLAND LAKE GOLD 

(the Registrant)



Date:


March 31, 2004


By:


Signed "Sandra Lee"

   

Signature


Sandra Lee, Secretary

   

Name*

        Title

*Print name and title under the signature of the signing officer



GENERAL INSTRUCTIONS


A.

Rule as to Use of Form 6-K


This form shall be used by foreign private issuers which are required to furnish reports pursuant to Rule 13a-16 or 15d-16 under the Securities Exchange Act of 1934.


B.

Information and Document Required to be Furnished


Subject to General Instruction D herein, an issuer furnishing a report on this form shall furnish whatever information, not required to be furnished on Form 40-F or previously furnished, such issuer


(i) makes or is required to make public pursuant to the law of the jurisdiction of its domicile or in which it is incorporated or organized, or

(ii) files or is required to file with a stock exchange on which its securities are traded and which was made public by that exchange, or

(iii) distributes or is required to distribute to its securityholders.


The information required to be furnished pursuant to (i),(ii) or (iii) above is that which is material with respect to the issuer and its subsidiaries concerning: changes in business; changes in management or control; acquisitions or dispositions of assets; bankruptcy or receivership; changes in registrant's certifying accountants; the financial condition and results of operations; material legal proceedings; changes in securities or in the security for registered securities; defaults upon senior securities; material increases or decreases in the amount outstanding of securities or indebtedness; the results of the submission of matters to a vote of security holders; transactions with directors, officers or principal security holders; the granting of options or payment of other compensation to directors or officers; and any other information which the registrant deems of material importance to securityholders.


This report is required to be furnished promptly after the material contained in the report is made public as described above.  The information and documents furnished in this report shall not be deemed to be "filed" for the purposes of Section 18 of the Act or otherwise subject to the liabilities of that section.


If a report furnished on this form incorporates by reference any information not previously filed with the Commission, such information must be attached as an exhibit and furnished with the form.


C.

Preparation and Filing of Report


This report shall consist of a cover page, the document or report furnished by the issuer, and a signature page.  Eight complete copies of each report on this form shall be deposited with the Commission.  At least one complete copy shall be filed with each United States stock exchange on which any security of the registrant is listed and registered under Section 12(b) of the Act.  At least one of the copies deposited with the Commission and one filed with each such exchange shall be manually signed.  Unsigned copies shall be conformed.


D.

Translations of Papers and Documents into English


Reference is made to Rule 12b-12(d).  Information required to be furnished pursuant to General Instruction B in the form of press releases and all communications or materials distributed directly to securityholders of each class of securities to which any reporting obligation under Section 13(a) or 15(d) of the Act relates shall be in the English language.  English versions or adequate summaries in the English language of such materials may be furnished in lieu of original English translations.


Notwithstanding General Instruction B, no other documents or reports, including prospectuses or offering circulars relating to entirely foreign offerings, need be furnished unless the issuer otherwise has prepared or caused to be prepared English translations, English versions or summaries in English thereof.  If no such English translations, versions or summary have been prepared, it will be sufficient to provide a brief description in English of any such documents or reports.  In no event are copies of original language documents or reports required to be furnished.

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