Annual Transition Report (10-kt)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

[ ] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

[X] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from
June 1 2016 to December 31 2016 .

Commission file number: 000-51775

STERLING GROUP VENTURES, INC.
(Exact name of registrant as specified in its charter)

Nevada	72-1535634
(State or other jurisdiction of incorporation or	(I.R.S. Employer Identification No.)
organization)

520 – 409 Granville St
Vancouver BC Canada	V6C 1T2
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (604) 564-0765

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
None	None

Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $0.001
(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.
Yes [ ] No [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes [ ] No [X]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S–T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes [ ] No [X]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]	Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes [ ] No [X]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked prices of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

The aggregate market value of the voting and non-voting share of Common Stock held by non-affiliates of the registrant was approximately $12,859,551 based on the price at which the common equity was sold as of November 30, 2016 (at $0.15) .

The number of shares of common stock, par value $0.001 per share, outstanding as of was 85,730,341.

Documents incorporated by reference: None.

STERLING GROUP VENTURES INC.
DECEMBER 31, 2016 TRANSITIONAL REPORT ON FORM 10-K

TABLE OF CONTENTS

		Page

PART I

Item 1.	Business	4

Item 1A.	Risk Factors	6

Item 1B.	Unresolved Staff Comments	8

Item 2.	Properties	9

Item 3.	Legal Proceedings	11

Item 4.	Mine Safety Disclosures	11

PART II

Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	12

Item 6.	Selected Financial Data	13

Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	13

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	17

Item 8.	Financial Statements and Supplementary Data	17

Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	39

Item 9A.	Controls and Procedures	39

Item 9B.	Other Information	39

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	40

Item 11.	Executive Compensation	42

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	44

Item 13.	Certain Relationships and Related Transactions and Director Independence	45

Item 14.	Principal Accounting Fees and Services	45

PART IV

Item 15.	Exhibits and Financial Statement Schedules	47

SIGNATURES

Cautionary Statement Regarding Forward-Looking Statements

Safe Harbor Statement under the United States Private Securities Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information constitutes "forward-looking statements" within the meaning of the Private Securities Litigation reform Act of 1995. Such forward looking statements, including but not limited to those with respect to the price of phosphate, potassium, nitrogen, and other commodities, the timing and amount of estimated production, costs of production, reserve determination and reserve conversion rates, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Such factors include, among others, risks relating to the integration of the acquisition, risks relating to international operations, risks relating to joint venture operations, the actual results of current exploration activities, the actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of phosphate, potassium, nitrogen, fertilizer and other commodities, as well as those factors affecting the mineral industry. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

This annual report contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. Some discussions in this report may contain forward-looking statements that involve risk and uncertainty. A number of important factors could cause our actual results to differ materially from those expressed in any forward-looking statements made by us in this report. Forward-looking statements are often identified by words like: “believe”, “expect”, “estimate”, “anticipate”, “intend”, “project” and similar expressions or words which, by their nature, refer to future events.

In some cases, you can also identify forward-looking statements by terminology such as “may”, “will”, “should”, “plans”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", which may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. All references to “ $” refer to US Dollars, all references to “CA $” refer to Canadian Dollars, all references to “RMB” refer to Chinese Yuan and all references to "common shares" refer to the common shares in our capital stock.

As used in this annual report, the terms "we", "us", "our", “the Company” and "Sterling" mean Sterling Group Ventures, Inc., unless otherwise indicated.

Sterling is a mining and exploration company, involved in the development of Gaoping property, a phosphate deposit through its acquisition of Chenxi County Hongyu Mining Co. Ltd. (Hongyu) in Hunan, China, and is developing a mining operation on the Gaoping property. There is no assurance we will be able to commercially develop mineral deposits on the claims that we have under option. Further exploration may be required before a final evaluation as to the economic and legal feasibility of the claims is determined.

PART I

ITEM 1. BUSINESS.

General

We were incorporated in the state of Nevada on September 13, 2001 and established a fiscal year end of May 31. Since our incorporation, we have engaged in the business of mining exploration and development. On January 20, 2004, Sterling completed the acquisition of all of the issued and outstanding shares of Micro Express Ltd. (“Micro”), which was incorporated on July 27, 1994 and engaged in exploration and development of Lithium. Pursuant to the transaction, the Company issued an aggregate of 25,000,000 shares of Sterling’s common stock to the stockholders of Micro in exchange for 100% of the outstanding shares of Micro’s common stock. The business combination was accounted for as a reverse acquisition whereby the purchase method of accounting was used with Micro being the accounting parent and the Company being the accounting subsidiary. The Company has since terminated the joint venture agreements related to the Lithium projects in 2011 as more fully described herein. On July 8, 2011, Sterling acquired a 90% interest in Chenxi County Hongyu Mining Co. Ltd. (“Hongyu”), and the other 10% of Hongyu was transferred to the nominees of Sterling. Pursuant to the transaction, Sterling issued 10,000,000 shares of its common stock to the existing Hongyu shareholders.

We are a mining company principally engaged in the search, exploration and development of phosphate and related minerals through our recent acquisition of Chenxi County Hongyu Mining Co. Ltd. Our statutory registered agent's office is located at 123 West Nye Lane, Suite 129, Carson City, Nevada 89706 and our business office is located at 904 – 1455 Howe Street, Vancouver, B.C., Canada, V6Z 1C2. Our telephone and fax number is (604) 684-1001.

Phosphate Overview

Phosphate rock is a general description applied to several kinds of rock which contain significant concentrations of phosphate minerals, which are minerals that contain the phosphate ion in their chemical structure and is the eleventh most abundant element in the lithosphere.

Many kinds of rock contain mineral components containing phosphate or other phosphorus compounds in small amounts. However, rocks which contain phosphate in quantity and concentration which are economic to mine as ore, for their phosphate content, are not particularly common. The two main sources for phosphate are guano, formed from bird droppings, and rocks containing concentrations of the calcium phosphate mineral, apatite.

In general, lower concentrations of phosphate and lower quality deposits require increasing amounts of energy and chemicals in order to produce phosphate and can represent a significant increase in costs.

Phosphorus, P in the table of elements, is present in every living cell in both plants and animals and is essential to the process of photosynthesis in plants. As such, phosphorus, among other fertilizers, is essential to plant growth. Plants absorb phosphorus through the soil as various forms of phosphate. Besides nitrogen and potassium, phosphorus is one of the three nutrients required for plant growth and cannot be substituted. It is also insoluble so that it can be washed easily.

Phosphate content in currently mined rocks can range anywhere from 5% to 40%. Thus, the rocks must be processed to remove the bulk of the contained minerals and impurities normally through washing as the initial step thus increasing phosphate grades.

Gaoping Phosphate Project

On October 18, 2010, Sterling Group Ventures, Inc. (“Sterling”) signed two agreements (the “Agreements”) with Chenxi County Hongyu Mining Co. Ltd. (“Hongyu”) and its shareholders (“Hongyu Shareholders”) regarding the Gaoping phosphate mine (the “GP Property”) located in Tanjiachang village, Chenxi County, Hunan Province, China and other phosphate resources in Hunan Province.

Hongyu is a Chinese private mining company with connections and resources in Hunan, China. Hongyu was an inactive company holding a mining permit and a deposit of $122,134 placed with local land administrative bureau for undertaking the restoration of land to its present condition when the lease term expires after the property is mined. Hongyu is interested in exploring, developing and expanding its Phosphate business. Hongyu is the holder of a mining permit (the “ Permit ”) in the GP Property located in Tanjiachang village, Chenxi County, Hunan Province, China. Due to lack of funds, Hongyu was inactive without current operations being conducted. The GP Property is a sedimentary phosphate type deposit. The number of the mining permit is 4300002009116120048322 and it is valid until November 10, 2014. On April 29, 2015, Hongyu obtained the renewal of the mining permit, which is valid until April 2, 2018. The area covered by the Permit is 0.4247 km2 (42.47 hectares). The mining permit allows initial production up to 100,000 tonnes of phosphate rock per year.

The Agreements required an investment company to be incorporated in Hong Kong (the “Investment Company”) which was to be owned 20% by the Hongyu Shareholders and 80% by Sterling. On October 13, 2010, the Investment Company was incorporated in Hong Kong under the name Silver Castle Investments Ltd. (“Silver Castle”). Silver Castle acquired 90% of Hongyu with the other 10% of Hongyu transferred to the nominees of Sterling. Upon completion of this acquisition, Hongyu became a Hong Kong / China joint venture company. Sterling received all required approvals from Chinese authorities for the completion of its acquisition of Hongyu pursuant to the Agreements dated October 18, 2010. The Company paid a total RMB 2,000,000 ($310,438) to the Hongyu Shareholders with RMB 200,000 (US$30,934) paid as down payment on December 14, 2010 and the remaining RMB1,800,000 ($279,504) paid on July 8, 2011 for completion of the transaction.

Pursuant to the Agreements, Hongyu agreed to surrender its future exclusive cooperative rights to Sterling, and the Hongyu Shareholders agreed that Sterling shall have all Hongyu's title and interest in any phosphate properties, including but not limited to the GP Property, and Sterling should arrange for the financing of building a mining and processing plant on the GP Property together with other facilities required for a mining operation thereon.

When requested by Sterling, the Hongyu Shareholders agreed to sell their 20% interest in the Investment Company to Sterling for the issuance of 10,000,000 common shares of Sterling’s capital stock. On July 5, 2011, Sterling issued 10,000,000 shares to the Hongyu Shareholders with the closing market price of the shares at $0.22 for acquiring the remaining 20% equity interest in Silver Castle from the Hongyu Shareholders. As a result of this transaction, Sterling effectively controls 100% of Hongyu through its wholly owned subsidiary, Silver Castle Investments Ltd. which holds 90% of Hongyu with the other 10% held by the nominees of Sterling.

Sterling through its subsidiary company, Silver Castle Investments Ltd., also signed a letter of intent for a larger area known as Tanjiachang Exploration Concession with Chenxi County Merchants Bureau, Hunan Province, China. Tanjiachang Exploration Concession is surrounding the Gaoping Mining permit.

As a mining license was obtained for the Gaoping Phosphate Property and a Chinese engineering report was completed, Hongyu is making progress on this property as follows. On February 13, 2012, Hongyu received approval for installing the power line for the Gaoping Phosphate Property. Hongyu also reached an understanding for land rental with a local village committee on March 17, 2012. Hongyu signed and completed a land rental agreement with each family in the mining area on March 27, 2012. On April 1, 2012, Hongyu also received conditional safety approval from the Supervision and Management Bureau for Safety Operation of Chenxi County and the project is essentially ready to begin production on a small-scale basis to be further ramped up as the development and production plan takes effect. On April 22, 2012, Hongyu signed a mining agreement with the mining contractor, Yichang Rongchang Mining Co. Ltd., to be the operator of the mining and production activities on the project. On June 16, 2012, Hongyu completed power line construction. On July 19, 2012, Hongyu received the explosive operation permit. Accommodations for mining people have been built. An onsite office and accommodations for workers and mining management are complete. The water supply for the mining operation and living quarters is connected to the site. The road to the mining site has been completed. Three adits have been dug and they will be used to access the phosphorite along its strike length.

On March 10, 2013, Hongyu signed a profit sharing agreement with Yichang Baolin Mining Engineering Co. Ltd (“Baolin”) for mining and processing phosphate rock from the Project. Baolin has a processing plant using a scrubbing processing which can process up to 100,000 t/a. However, Baolin has also built a new simple washing processing plant near Gaoping property to reduce the transportation cost. Hongyu has also signed an agreement with the Yichang Yinuo Biotech Co. Ltd (“Yinuo”) to jointly produce and market bio-phosphate fertilizer. Yinuo has its own microbial inoculants and its fertilizer market brand is Mingxinglinde which is an organic biofertilizer. The aforementioned progress is presented as an interim measure to gauge the ease and efficiency of the mining process together with the efficacy of the contractual arrangements made to produce and market the phosphate rock.

As a substantial decrease of phosphate rock and phosphate fertilizer market pricing has occurred, Hongyu has halted further exploration and development since August 2013 until the world market prices rebound and has kept the property in care and maintenance mode. Such an action preserves the phosphate rock in situ and saves operating capital while world prices for phosphate rock are in a depressed state. The Company’s capital contributions to the project were held to a minimum by its contracting the mining and washing functions to Yichang Baolin Mining Engineering Co. Ltd.

The Company has continued the services of several key employees in China to review other mining properties and opportunities. In pursuit of one such opportunity, Hongyu has obtained a registration code from Customs of People’s Republic of China for the import and export business which may afford the Company the opportunity to act as an agent or distributor for the importation and exportation of fertilizer products. Hongyu is also continuously reviewing and looking other opportunities in mining.

As of December 31, 2016, the Gaoping mineral property is still an exploration stage property as it does not yet have proven reserves.

The Company will monitor the production and marketing with the goal of increasing production and sales over time in a measured and economically viable manner. Currently due to the downturn in world market prices for phosphate rock and concentrate, the Company has decided to curtail the stockpiling of phosphate rock until world prices and world sales increase. Such an action preserves the phosphate rock in situ and saves operating capital while world prices of phosphate rock are in a depressed state.

Employees

At of December 31, 2016, we have 8 employees in China. We have no employees in Canada, other than our officers and directors. Our officers and directors do not have employment agreements with us, except consulting agreements which can be cancelled with 30 days’ notice.

New Business

On November 11th, 2016, Sterling Group signed a definitive share exchange agreement with Euroclub Holding Ltd (“Euroclub”). As a result, Euroclub will become a subsidiary of Sterling with business in Brazil, Russia, India, China and Europe. The company’s online gaming platform is being launched in India and China.

As a result of the acquisition, Mr. Nick Mellios, the founder, CEO and shareholder of Euroclub, who resides in Vancouver, British Columbia, will be appointed CEO of Sterling. Mr. Mellios has been in the online gaming business since 1999. He graduated from the University of British Columbia with a Bachelor of Science degree in Mathematics and an MBA in 1995. Mr. Mellios has replaced Mr. Tsakok, MBA, CFA as CEO, who will remain an independent director and Chairman of the Audit Committee.

Euroclub has enjoyed substantial growth as per its unaudited financial statements over the past 2 years with revenue of €406,030 in 2014 and €655,224 in 2015.

Euroclub is a well-established online gaming company that provides a B2B and B2C multi-gaming platform under the MOJO brand name with a full suite of social and real money gaming products, including online poker, casino games, and third party integrations to live dealer, e-sports, sports betting and skill games. Mojo offers B2B partners both API integrated and turnkey white label licensing options with comprehensive global payment processing. Mojo’s registered office is in Malta with 25 technical staff in Vancouver, Dublin and Barcelona and support over 20 B2B partners and B2C operations with gaming licenses in Malta and Curacao.

On April 14, 2017, the Board of Directors approved the changing of the Company's fiscal year end from May 31 to December 31. A transition report covering the period from May 31, 2016 to December 31, 2016 will be filed on Form 10-K.

On November 1, 2017, Sterling Group successfully closed the Honyu operations, mining project and company in China. Management reports the mine and bank accounts were closed and the funds remaining less expenses were repatriated back to the Canadian subsidiary. As part of the closure procedure, Sterling Group provided the directors of Honyu indemnification from any claims thereof resulting from Honyu’s phosphate mining project.

ITEM 1A. RISK FACTORS

We have sought to identify what we believe to be the most significant risks to our business. However, we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise. Investors should carefully consider all of such risk factors before making an investment decision with respect to our Common Stock. We provide the following cautionary discussion of risks, uncertainties and possible inaccurate assumptions relevant to our business. These are factors that we think could cause our actual results to differ materially from expected results. Other factors besides those listed here could adversely affect us.

Factors That May Affect Future Results and Market Price of Stock

The business of the Company involves a number of risks and uncertainties that could cause actual results to differ materially from results projected in any forward-looking statement, or statements, made in this report. These risks and uncertainties include, but are not necessarily limited to the risks set forth below. The Company's securities are speculative and investment in the Company's securities involves a high degree of risk and the possibility that the investor will suffer the loss of the entire amount invested.

There is Substantial Doubt About the Company’s Ability to Continue as a Going Concern

Sterling is engaged in acquisition, exploration and development of mineral properties. The Company has acquired the Gaoping phosphate properties located in Chenxi County, Hunan Province, China. The Company has not yet achieved profitable operations and is dependent on its ability to raise capital from shareholders or other sources to meet its obligations and repay its liabilities arising from normal business operations when they come due. These factors raise substantial doubt that the Company will be able to continue as a going concern.

Lack of Technical Training of Management

The Management of our Company has academic and scientific experience related to mining issues but lacks technical training and experience exploring for, commissioning and operating a mine. With no direct training or experience in these areas, management may not be fully aware of many of the specific requirements related to working within this industry. The decisions and choices may not take into account standard engineering or managerial approaches mineral exploration companies commonly use. Consequently, operations, earnings and the ultimate financial success of the Company could suffer irreparable harm due to management’s lack of experience in this industry.

Exploration Risk

Development of mineral properties is contingent upon obtaining satisfactory exploration results. Mineral exploration and development involves substantial expenses and a high degree of risk, which even a combination of experience, knowledge and careful evaluation may not be able to adequately mitigate.

The Gaoping property has been examined in the field by professional geologists/mining engineers. The Company received the National Instrument 43-101 report (Canadian Standard) entitled “Property Evaluation Report” (PER). The production decision announced was based on Chinese Technical Reports and the PER and not based on a Preliminary Economic Assessment (PEA) or mining study (a Prefeasibility or Feasibility Study) of mineral reserves demonstrating economic and technical viability. Resources that are not reserves do not have demonstrated economic viability. There is an increased risk of technical and economic failure because the development decision was based on inferred resources, without a preliminary economic analysis or mining study as defined by NI 43-101. Professional geologists also made an exploration proposal for the Tanjiachang Exploration Concession which is surrounding the Gaoping property which is under letter of intent with Chenxi County Merchants Bureau, Hunan Province, China. There is no assurance that the exploration license for the Tanjiachang Exploration Concession will be issued. There is no assurance that commercial quantities of ore will be discovered on the Tanjiachang Exploration Concession. There is also no assurance that, even if commercial quantities of ore are discovered, the Tanjiachang Exploration Concession will be brought into commercial production. Since 2012, the Central Government made its move to change the mining laws to provincial jurisdiction. The new application process was held. Previously issued licenses are being honored.

The discovery of mineral deposits is dependent upon a number of factors not the least of which is the technical skill of the exploration personnel involved. The commercial viability of a mineral deposit, once discovered, is also dependent upon a number of factors, some of which are the particular attributes of the deposit, such as size, grade and proximity to infrastructure, metal prices and government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. In addition, assuming discovery of a commercial ore body, depending on the type of mining operation involved, several years can elapse from the initial phase of drilling until commercial operations are commenced. Most of the above factors are beyond the control of the Company.

The properties may need exploration and such exploration processes shall be conducted in phases. When each phase of a particular project is completed, and upon analysis of the results thereto, the Company will make a decision on whether to proceed with each successive phase of the exploration program. There is no assurance that projects will be carried to completion.

Limited Management Resource Development Experience

The Company does not have a track record of exploration and mining operation history. The Company's management has limited experience in mineral resource development and exploitation and has relied on and may continue to rely upon consultants and others for development and operation expertise.

Limited Financial Resources

Furthermore, the Company has limited financial resources with no assurance that sufficient funding will be available to it for future exploration and development or to fulfill its obligations under current agreements. There is no assurance that the Company will be able to obtain adequate financing in the future or that the terms of such financing will be favorable. Failure to obtain such additional financing could result in delay or indefinite postponement of further exploration and development of its projects.

Limited Public Market, Possible Volatility of Share Price

The Company's Common Stock is currently quoted on the OTCQB marketplace under the ticker symbol SGGV. As of December 31, 2016, there were 85,730,341 shares of common stock outstanding. There can be no assurance that a trading market will be sustained in the future.

Dependence on Executive Officers and Technical Personnel

The success of our business plan depends on attracting qualified personnel, and failure to retain the necessary personnel could adversely affect our business. Competition for qualified personnel is intense, and we may need to pay premium wages to attract and retain personnel. Attracting and retaining qualified personnel is critical to our business. Inability to attract and retain the qualified personnel necessary would limit our ability to implement our business plan successfully.

Need for Additional Financing

The Company believes it has sufficient capital to meet its needs for at least the next 12 months, including the costs of compliance with the continuing reporting requirements of the Securities Exchange Act of 1934. However, if losses continue, it may have to seek loans or equity placements to cover longer-term cash needs to continue operations and expansion.

No commitments to provide additional funds have been made by management or other stockholders. Accordingly, there can be no assurance that any additional funds will be available to the Company to allow it to cover operation expenses.

If future operations are unprofitable, the Company will be forced to develop another line of business, or to finance its operations through the sale of assets it has, or enter into the sale of stock for additional capital, none of which may be feasible when needed. The Company has no specific management ability or financial resources or plans to enter any other business as of this date.

Dilution to the Existing Shareholders

The Company has no other capital resources other than the ability to use its common stock to raise additional capital or the exercise of the warrants by the unit holders, which will significantly dilute the Company's stockholders.

Market Risk and Political Risks

The Company does not hold any derivatives or other investments that are subject to market risk. The carrying values of any financial instruments, approximate fair value as of those dates because of the relatively short-term maturity of these instruments, which eliminates any potential market risk associated with such instruments.

The market in China is monitored by the government, which could impose taxes or restrictions at any time which would make operations unprofitable and infeasible and cause a write-off of investment in the mineral properties. Other factors include political policy on foreign ownership, political policy to open the doors to foreign investors, and political policy on mineral claims and metal prices.

The disruptions in the financial markets and economic conditions have adversely affected the US and the world economy. Turmoil in global credit markets and turmoil in the geopolitical environment in many parts of the world have adversely affected global economic conditions. There can be no assurances that government responses to the disruptions in financial markets will restore investor confidence and economic activity. This could affect our ability to raise capital.

Additionally, the uncertain economic environment may cause farmers to use less fertilizer to cut costs, which will adversely affect the demand for phosphate. A similar situation occurred in 2008 leading to a sharp decline in phosphate prices.

The Honyu’s phosphate deposit is located in China which, as a result of its operations, exposes the Company to political and market risks in China. Exports of phosphate rock are currently subject to an export tax due to domestic phosphate requirements.

Other Risks and Uncertainties

The business of mineral deposit exploration and development involves a high degree of risk. Few properties that are explored are ultimately developed into production. Other risks facing the Company include competition, reliance on third parties and joint-venture partners, environmental and insurance risks, political and environmental instability, statutory and regulatory requirements, fluctuations in mineral prices and foreign currency, share price volatility, title risks, and uncertainty of additional financing.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTY

Gaoping Phosphate Property

Gaoping Phosphate Property which is surrounded by Tanjiachang Phosphate Exploration Concession is located in NEE 80°direction of Chenxi County town with distance 38 km and is under jurisdiction of Tanjiachang village, Chenxi county of Hunan Province. Geographical coordinates of mining permit’s ranges:

Longitude East 110°26 ′15 ″~110°27 ′05″, Latitude North 28°01 ′49″~28°03′14″.

Geological coordinates of Tanjiachang Phosphate Exploration Concession’s ranges:
Longitude East 110° 25 ′15 ″~ 110° 30 ′00″, Latitude North 28°00 ′00″~28° 07′30″. The area is about 32 km ² .

The location of the property is shown in the following map.

The property is located in Hunan Province in South Eastern China some 250 kilometers west of the Provincial Capital of Changsha and 120 kilometers north east of the regional center of Huaihua and 38 kilometers east of the County seat at Chenxi. There are several flights per day into Changsha from Beijing or Shanghai and three flights per week into Huaihua. Several daily bus schedules are available from Changsha to Huaihua and Chenxi. Huaihua is a city of about six million people. The County of Chenxi has a population of five million and the city of Chenxi is the county seat. Chenxi has no air service and is quite agrarian in its culture. Currently high speed trains are available in Huaihua city.

The Gaoping Phosphate property consists of a mining permit outlined by the following UTM Coordinates:

1. X=3102000 Y=37444690        2. X=3102985 Y=37444925
3. X=3103920 Y=37445430        4. X=3104210 Y=37445300
5. X=3104593 Y=37445604        6. X=3104555 Y=37445715
7. X=3104215 Y=37445465        8. X=3103910 Y=37445600
9. X=3102915 Y=37445065        10. X=3102000 Y=37444850

The Gaoping mining permit was issued on November 10, 2009 and valid until November 10, 2014. On April 29, 2015, Hongyu obtained the renewal of the mining permit, which is valid until April 2, 2018. The number of the permit is 4300002009116120048322. The permit is 0.4247 km ² and the elevation is from +600mto+510m. These 10 boundary points of Gaoping mining permit are surveyed by official land surveyors.

The mining permit allows initial production up to 100,000 tonnes phosphate ore per year. In order to acquire more resources under the mining permit, Hongyu needs to invest not less than RMB 20 million Yuan in county including paying resource fees to the Chinese government according to related Chinese regulations and applies to expand the scale of current mining permit through the legal process in China.

The Tanjiachang phosphate district is located in the Xiuxi-Luojiawan anticlinorium and Tanjiachang syncline. The strata generally occur in an undeformed or weak monoclinal structure. Strata outcropping in Tanjiachang region ranges from Banxi Group of Upper Proterozoic to Cambrian of the Lower Paleozoic.

Strata outcropping in the mine area includes Jiangkou Formation, Xiangmeng Formation and Hongjiang Formation of Lower Sinian and Jinjiadong Formation, Liuchapo Formation of Upper Sinian and Xiaoyanxi Formation of Lower Cambrian. The phosphorite deposits lie in the middle part of Jinjiadong Formation. The phosphorite is Interbedded with argillaceous & silty platy shale. The deposit is in shallow marine sediment deposit type.

The regional geological structure is relatively complicated and the main structure is Xiuxi- Luojiawan Anticlinorium with many cross faults. Geological structure of mine area is relatively simple in general. The strata strikes NNE and dips SEE.

The main mineral resource with industrial significance in this region is the phosphorite, and is the middle to lower part of Jinjiadong Formation, Upper Sinian. Some Pb- Zn mineralization has been discovered in the lower part of the Jinjiadong Formation and Cu mineralization has been discovered in middle part of the sandy slabby shale beds. The lower part is green grey laminar sandy slate. Manganese carbonate within black platy shale of Xiangmeng Formation could set up local industry scale operations. Manganese carbonate is easy to process, with good market conditions, providing realistic opportunities to do exploration and development.

There is a history of mining in the Gaoping area. In the past, numerous artisanal lead zinc mines have been worked. In the permit area the phosphorite has been mined for many years and there are at least ten adits old and new, which have accessed the phosphorite and where the local artisanal miners have harvested this material for sale to the local agriculture industry.

Regional Geology Survey with scale of 1:200,000 had been done by Regional Geology Survey Team of Hunan Provincial Geology in 1970’s and Mineral Resources Bureau and Regional Geology Survey Report (in scale of 1:200,000) and Regional Mineral Resources Report have been submitted. The No. 407 Geology Team from Hunan Provincial Geology and Mineral Resources Bureau launched the General Survey for Pb-Zn Mineralization in Upper-Jingzhuxi, Lower-Jingzhuxi inside Tanjiachang mining area and Dabanlin outside of Tanjiachang, etc in 1980s. They drilled five boreholes but the data is unavailable for data collection. Chemical Geology Exploration Institute, Hunan Province had organized early stage big area scouting and field trips in September to October 1992 and chose Jingzhuxi section as the General Geology Survey working area in the year of 1993 which has been defined as Tanjiachang.As the General Geology Survey work moving forward, Tanjiachang Phosphorite Mining Area becomes enlarged step by step and it has been divided into three sections of Jingzhuxi, Gaoping and Wenshuitang.

The following table summarizes the geological works conducted by Chemical Geology Exploration Institute, Hunan Province.

Item	unit	Quantity			sub-total	Remarks
Item	unit	1993	1994	1995	sub-total	Remarks
1:10000 Geology Mapping	km ²	10.9	10.5	10.5	31.9
1:1000 Onsite Geology Section Mapping	m	2305	2212	1,450	5,967	5 lines
Trenching and Logging	m ³	1,521.3	1,200	1,125	3,846.3	47 lines
Channel Sampling & Basic Assay		121	126	144	391
Identification of Rock and Minerals		30	22	21	73
Small Weight Sample Testing		30	20	25	75
Basic Chemical Assay		121	126	144	391
Assembly Assay			6	6	12

Trenches have been created to disclose the phosphorite ore layers with spacing 400m (mainly 300- 500m) and a total of 47 trenches have been finished with earthwork volume of 3,846.3 m ³ . The operation of trenches is accurate and the spacing is tried to be placed evenly. All the trenches have demonstrated good surface control effects on ore layers except for TC20 (the surface cover is too thick and it can’t control ore layers) and TC 47 (ore layers are missing due to fault) according to Chemical Geology Exploration Institute, Hunan Province. The trenches and sampling are all following State Code of Original Geology Logging General Principles for Solid Mineral Exploration Registration (china) and data has been logged in time.

Basic assay samples all came from channel sampling of trench projects and the samples are representative and following China State Code and Geology Standard. The scale of channel sampling is 5cm*3cm and the length is mainly 1m, separately sampled from different layers. Totally, 391 samples have been sampled from ore layers and their top and bottom plates. The samples have been prepared in time according with ID, tag, record and onsite logs. Small weight samples have been collected with representative year by year in history and certain related relationship has been detected between density of phosphorite and P ₂ O ₅ content. In general, the density and grade are with positive correlation. The petrology identification and testing samples are coming during onsite geology section survey to determine the lithology and mineral compositions. Totally, 73 samples have been collected. Based on basic assay results, composite sample has been made on backup samples from selected representatives 12 trenches to determine the useful and harmful components in the ore.

There are at least ten exploration adits driven into favorable locations along the mountain side. The artisans essentially find an outcrop move six to ten meters below the bed and drive into the mountain. Those adits, intersect the phosphorite and are turned into producing mines. By building a chute off the end of the waste pile at the entrance to the adit, the infrastructure for an artisanal mining operation is complete. The transportation infrastructures is completed by building a service road under the chute and loading the phosphorite onto the truck for haulage to the buyer in Chenxi. Contract haulers do the hauling. No drilling has been done on the property. Some exploratory trenching has been done at the various outcrops along the sidehill to test the validity of the above described adit exploration methods. Five samples were collected by Norm Tribe - an independent geologist from the active adits along the strike of the phosphorite bed. The results vary from 19.40% ^P 2 ^O 5 ^{to 32.86% P} 2 ^O 5 ^. The assays of the samples collected serve to verify the existence and grade of the deposit.

Hunan has a humid, subtropical climate. The monsoon rain falls mostly in April, May, and June. July and August are hot and humid. Annual rainfall is 1,250 - 1,750 millimeters (49.2 to 68.9 inches) in Chenxi and is probably higher at the property due to an increase in elevation. Temperatures are 4 ^o C to 8 ^o C in January and 26 ^o C to 30 ^o C in July. The area is said to have a variety of animals including 70 kinds of mammals, including tigers, bears and macaques, 310 kinds of birds, over 70 kinds of creeping animals and over 160 kinds of fish. The mining permit is in mountainous terrain with steep hill sides forested with native species and some planted pine forest. No wildlife was noted in the area. The valley bottoms are developed into terraced rice paddies. The coincident phosphate deposits which have been cut by the erosion of the steeply incised valleys has rendered these valley bottoms very fertile. Local infrastructure is at a low level but adequate for small mining. The roads are adequate for start up, the population is moderate with a collection of experienced miners available in the area. A moderate level power line passes through the property but would require upgrading for heavy industrial use. Artisanal miners working the property at this time are using readily available trucking contractors, to haul their product to the railhead. Railhead infrastructure is available 58 kilometers away at Chenxi. Water is abundant in the valley bottoms but will require some infrastructure to accommodate the mining. Telecommunication is very good. Cellular phone can be accessed in the property area. Transportation is good and truck can arrive in the property area.

As of December 31, 2016, the Company has incurred mineral property costs of $1,219,158 on the Gaoping Phosphate property in addition to acquisition costs $3,271,005. On November 1, 2017, Sterling Group successfully closed the Honyu operations, mining project and company in China. Management reports the mine and bank accounts were closed and the funds remaining less expenses were repatriated back to the Canadian subsidiary. As part of the closure procedure, Sterling Group provided the directors of Honyu indemnification from any claims thereof resulting from Honyu’s phosphate mining project.

ITEM 3. LEGAL PROCEEDINGS

We are aware of one claim against the Company. On May 15, 2017, the Company received notice that a civil claim was filed by Mr. Nicholas Edward Yuen-Zong Chan (the “Plaintiff”) in the Vancouver Registry of the Supreme Court of British Columbia on May 5, 2017. The Company filed their response on June 6, 2017, wherein they denied the plaintiff’s claim. The Plaintiff is claiming that he is entitled to eight million common shares as a finder’s fee for a terminated acquisition transaction to acquire US$50 million of real estate or cash in China. There is no signed contract or agreement of any kind in writing to prove this agreement exists. The Plaintiff claims that he has a verbal agreement with the Company that he is owed eight million common shares regardless of whether the related transaction closed or not. When the China real estate transaction was terminated on September 2, 2016, the Company returned all of the acquisition and finder’s fee shares that were being held in escrow to the transfer agent for cancellation.

The Company denies that it ever had a finder’s fee agreement with Mr. Nicholas Chan. Instead, it had a verbal finder’s fee agreement with Mr. Patrick Chan, the Plaintiff’s father, and that all of the parties agreed that the finder’s fee shares would be held in escrow pending closing and that closing of the transaction was clearly a condition to having the shares released from escrow. The reason the finder’s fee shares held in escrow were registered in the name of Mr. Patrick Chan’s son is because at the time Mr. Patrick Chan requested that his shares be registered that way. In any event, the shares never vested because the Company never received anything of value, and also lost about US$300,000 that they had advanced to the intended subsidiary for software development which was also never verified by Mr. Patrick Chan when asked to do so. After the share certificate was issued by the transfer agent, the Company found out that Mr. Patrick Chan was a director and major shareholder of the acquisition target. Normally finder’s fees are not paid to directors of either company in a transaction, but only to arm’s length parties. This may explain why he wanted the shares registered in his son’s name. When it became clear to the Company during the due diligence process that the vendors did not own the real estate assets, the Company moved to terminate the acquisition agreement. Mr. Patrick Chan, who was representing the Chinese vendor, refused to provide documentation to prove the assets were owned by the vendor. Prior to terminating the agreement, the Company hired international law firm Dentons to check on the assets in China and they reported that the vendor had no connection to the assets. At this point the parties have disclosed documents to each other and the next step will be discovery of witnesses which is expected to be completed this year. The next step would be to schedule a trial.

The court will have to decide whether or not a verbal finder’s fee agreement between the Company and Mr. Nicholas Chan existed at all, and if so, whether it entitled him to immediate payment of eight million shares of common stock even if the whole transaction is cancelled. The former CEO, Mr. Christopher Tsakok, has strongly denied both of these assertions by the Plaintiff, and there is nothing in writing between the parties that has been disclosed to suggest otherwise. Our corporate counsel, Thomas Braun, interviewed Mr. Raoul Tsakok who was CEO prior to his son Mr. Christopher Tsakok being appointed. Both of the Tsakok’s have denied all of the Plaintiff’s claims and are outraged by it. Nicholas and Patrick Chan were also interviewed over the telephone for over one hour. They continually changed their story and contradicted themselves. Mr. Patrick Chan had no explanation why as a chartered accountant he would not have an agreement for eight million shares in writing if only for the Company’s audit and his income tax purposes. Based on the evidence that has been disclosed it is hard for me to see how the plaintiff will prove their case beyond a balance of probabilities which is the test used in civil court. In our opinion the Plaintiff has a low probability of success, based on all of the evidence that has been disclosed so far. However, court cases can be unpredictable at times, and we estimate the potential damages in the unlikely event that the Plaintiff is successful.

The Plaintiff claims damages in the range of US$1,120,000 to US$1,440,000 which they base upon the highest trading value of the Company’s stock which occurred around December 2016 and January 2017. In the alternative, the Plaintiff claims quantum meriut damages. It is hard to imagine that the Plaintiff would be entitled to any quantum merit damages since the company lost money on the deal, therefore, there is no unjust enrichment on behalf of the Company and the Plaintiff provided nothing of value. The deemed value of the shares upon issuance was US$144,000. Therefore, if the Plaintiff is successful in proving their case the range of damages Is between US$144,000 and US$1,440,000.

The management of the Company believes that this is a nuisance claim that has no merit, and we intend to defend against it vigorously.

ITEM 4. MINE SAFETY DISCLOSURES

None.

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Common Stock

Our common stock is traded on the OTCQB Marketplace under the symbol “SGGV”. The table below sets forth the high and low sales prices for the Company’s common stock for the fiscal years ended May 31, 2015 & 2016 and the period ended of December 31, 2016. The quotations below reflect inter-dealer prices, without retail markup, markdown or commission and may not represent actual transactions.

Quarter Ended	High ($)	Low ($)
February 28, 2015	0.02	0.01
May 31, 2015	0.03	0.01
August 31, 2015	0.03	0.01
November 30, 2015	0.02	0.01
February 29, 2016	0.02	0.01
May 31, 2016	0.04	0.01
August 31, 2016	0.035	0.021
November 30, 2016	0.15	0.018
December 31, 2016	0.l7	0.10

Pacific Stock Transfer Company is the registrar and transfer agent for our common shares, and is located at 6725 Via Austi Pkwy, Suite 300 Las Vegas, NV 89119 (Telephone: (702) 361-3033; Facsimile: (702) 433-1979).

On December 31, 2016, we had 85,730,341 shares of common stock outstanding and we had 53 stockholders of record plus common shares held by brokerage clearing houses, depositories or other entity.

Dividend Policy

We currently intend to retain all future earnings to fund the development and growth of our business. We have not paid dividends on our common stock and do not anticipate paying cash dividends in the immediate future. We did not repurchase any of our equity securities and have not adopted a stock repurchase program.

Recent Sales of Unregistered Securities

None.

Equity Compensation Plan Information

On February 3, 2004, the Board of Directors of the Company approved the 2004 Stock Option Plan, which was also approved at the Company’s Annual Meeting of Shareholders on January 17, 2005 and registered on May 12, 2004. Pursuant to the stock option plan, the number of shares that may be issued under the plan may not exceed 15% of the issued and outstanding shares of the company.

On April 27, 2011, the Company granted 4,700,000 stock options to directors, officers and consultants at an exercise price of $0.25 each expiring on February 3, 2019. The options were vested immediately.

On November 3, 2011, the Company granted 500,000 stock options to a consultant at an exercise price of $0.25 each expiring on February 3, 2019. The options were vested immediately.

At December 31, 2016, there were 5,200,000 stock options outstanding with an exercise price at $0.25 each expiring on February 3, 2019. The option plan was approved by the shareholders of the Company.

Share Purchase Warrants

As of December 31, 2016, the Company has a total of 3,817,500, 20,752,500, and 10,000,000 Series “A”, “D” and “F” share purchase warrants outstanding, respectively.

Each Series “A” warrant entitles the holder thereof the right to purchase one common share at $0.50 per share expiring on the earlier of:

1)	February 17, 2015; or
2)	The 30th day after the day on which the weighted average trading price of the Company's shares exceeds $0.80 per share for 20 consecutive trading days.

Upon exercise of the Series "A" Share Purchase Warrant at $0.50 each, the holder will receive one Common Share of the Company and a Series "B" Share Purchase Warrant exercisable at $1.00 expiring one year after the occurrence of either (1) or (2) as described above.

On February 10, 2015, the Company re-extended the expiry date of 3,817,500 Series "A" share purchase warrants from February 17, 2015 to the earlier of February 17, 2017 or the close of business on the 30th day after a takeover bid for the Company's issued and outstanding share capital has been made by a third party and approved by the shareholders of the Company. Upon exercise of the Series “A” Share Purchase Warrants at $0.50 each, the holder will receive one Common Share of the Company and a Series “B” Share Purchase Warrant exercisable at $1.00 for another year.

On February 10, 2015, the Company re-extended the expiry date of the 20,752,500 Series “D” Share Purchase Warrants (the “D” Warrants) from February 17, 2015 to the earlier of February 17, 2017 or the close of business on the 30th day after a takeover bid for the Company’s issued and outstanding share capital has been made by a third party and approved by the shareholders of the Company. The exercise price of the “D” Warrants remains unchanged at $0.15 per share.

The Series “A” warrant was extended to May 17, 2017 and subsequently expired
The Series “D” warrant was extended to September 17, 2017 and subsequently expired
The Series “F’ warrant issued in conjunction with a Rule 144 Private Placement based upon the exemption from registration found in Section 4(2) and Regulation S of the Securities Act announced November 11, 2016, expired in December, 2017.

ITEM 6. SELECTED FINANCIAL DATA

Not applicable.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Introduction

The information presented here should be read in conjunction with Sterling Group Venture Inc.'s financial statements and other information included in this Form 10-K. When used in this Form 10-K, the words "expects," "anticipates," "estimates" and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties, including those set forth below under "Risks and Uncertainties," that could cause actual results to differ materially from those projected. These forward-looking statements speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.

Overview

On October 18, 2010, Sterling signed two agreements (the "Agreements") with Chenxi County Hongyu Mining Co. Ltd. ("Hongyu") and its shareholders ("Hongyu Shareholders") regarding the Gaoping phosphate mine (the "GP Property") located in Tanjiachang village, Chenxi County, Hunan Province, China and other phosphate resources in Hunan Province. Hongyu holds a business license and a mining permit in the GP Property which is in effect until November 10, 2014 and covers 42.5 hectares. On April 29, 2015, Hongyu obtained the renewal of the mining permit, which is valid until April 2, 2018.

The Agreements required an investment company to be incorporated in Hong Kong (the “Investment Company”) which was to be owned 20% by the Hongyu Shareholders and 80% by Sterling. On October 13, 2010, the Investment Company was incorporated in Hong Kong under the name Silver Castle Investments Ltd. (“Silver Castle”). Silver Castle acquired 90% of Hongyu with the other 10% of Hongyu transferred to the nominees of Sterling. Upon completion of this acquisition, Hongyu became a Hong Kong / China joint venture company. Sterling received all required approvals from Chinese authorities for the completion of its acquisition of Hongyu pursuant to the Agreements dated October 18, 2010. Sterling paid a total RMB 2,000,000 ($310,438) to the Hongyu Shareholders with RMB 200,000 (US$30,934) paid as down payment on December 14, 2010 and the remaining RMB1,800,000 ($279,504) paid on July 8, 2011 for completion of the transaction.

As mining license was obtained for the Gaoping Phosphate Property and a Chinese engineering report was completed, Hongyu is making progress on this property as follows. On February 13, 2012, Hongyu received approval for installing the power line for the Gaoping Phosphate Property. Hongyu also reached understanding for land rental with local village committee on March 17, 2012. Hongyu signed and completed land rental agreement with each family in the mining area on March 27, 2012. On April 1, 2012, Hongyu also received conditional safety approval from Supervision and Management Bureau for Safety Operation of Chenxi County and the project is essentially ready to begin production on a small scale basis to be further ramped up as the development and production plan takes effect. On April 22, 2012, Hongyu signed a mining agreement with the mining contractor, Yichang Rongchang Mining Co. Ltd., to be the operator of the mining and production activities on the project. On June 16, 2012, Hongyu completed power line construction. On July 19, 2012, Hongyu received the explosive operation permit. Accommodation for mining people has been built. An onsite office and accommodation for workers and mining management are complete. The water supply for the mining operation and living quarters is connected to the site. The road to the mining site has been completed. Three adits have been dug and they will be used to access the phosphorite along its strike length.

The Company will monitor the production and marketing with the goal of increasing production and sales over time in a measured and economically viable manner. Currently due the downturn in world market prices for phosphate rock and concentrate, the Company has decided to curtail the stockpiling of phosphate rock until world prices and world sales increase. Such an action preserves the phosphate rock in situ and saves operating capital while world prices of phosphate rock are in a depressed state.

Hongyu applied to local government for halting further development until market rebound. Hongyu received the approval for such application from Supervision and Management Bureau for Safety Operation of Chenxi County on February 26, 2014.

On November 11, 2016, Sterling Group signed a definitive share exchange agreement with Euroclub Holding Ltd (“Euroclub”). As a result, Euroclub will become a subsidiary of Sterling with business in Brazil, Russia, India, China and Europe. The company’s online gaming platform is being launched in India and China.

Euroclub has generated growth as per its unaudited financial statements over the past 2 years with revenue of €406,030 in 2014 and €655,224 in 2015.

Euroclub is a well-established online gaming company that provides a B2B and B2C multi-gaming platform under the MOJO brand name with a full suite of social and real money gaming products, including online poker, casino games, and third party integrations to live dealer, e-sports, sports betting and skill games. Mojo offers B2B partners both API integrated and turnkey white label licensing options with comprehensive global payment processing. Mojo’s registered office is in Malta with 25 technical staff in Vancouver, Dublin and Barcelona to support over 20 B2B partners and B2C operations with gaming licenses in Malta and Curacao.

Results of Operations

The Company had no operating revenue except interest income of $191 for the period from June 1, 2016 to December 31, 2016 compared with interest income of $10,961 for the year ended May 31, 2016. The comprehensive loss decreased to $242,250 for the period from June 1, 2016 to December 31, 2016, as compared to $3,091,745 for the year ended May 31, 2016 mainly due to the decreased impairment of mineral properties and environmental deposit of $3,271,005.

Accounting, audit, legal and professional fees increased by $45,470 for the period ended December 31, 2016 when compared to the year ended May 31, 2016 mainly due to the changing of the Company's fiscal year end from May 31 to December 31 and preparing a transition report covering the period from May 31, 2016 to December 31, 2016.

Foreign exchange gain increased by $37,250 for the period ended December 31, 2016 when compared to the year ended May 31, 2016, because of the exchange rate fluctuation among US dollar, Canadian dollar and RMB.

Mineral property costs decreased by $59,091 for the period ended December 31, 2016 when compared to the year ended May 31, 2016, because developing the Gaoping phosphate property and building the mining facility was paused during the period ended May 31, 2016 due to ongoing challenges on the phosphate market. In particular, decreases in travel costs by $7,548, consulting Fees by $12,051, administrative costs by $336, mining permit by $10,922, and wages by $28,234 for the period ended December 31, 2016 when compared to the year ended May 31, 2016 comprised a large portion of the decrease.

Depreciation decreased by $16,228 for the period ended December 31, 2016 when compared to the year ended May 31, 2016.

Travel decreased by $1,568 for the period ended December 31, 2016 when compared to the year ended May 31, 2016.

The Company expects the trend of losses to continue until we can achieve commercial production at the Gaoping phosphate project, of which there can be no assurance as described in Risk Factors.

Liquidity and Working Capital

As of December 31, 2016, the Company had total current assets of $1,307,035 ($919,778 as of May 31, 2016), and total current liabilities of $424,031 ($426,566 as of May 31, 2016). As of December 31, 2016, the Company had cash of $736,596 ($907,158 as of May 31, 2016) and working capital of $883,004 ($493,212 as of May 31, 2016). A balance of approximately $714,309 of cash is held on deposit in China at December 31, 2016 compared with $774,776 of cash is held on deposit in China at May 31, 2016. Accessing the cash held on deposits in Hongyu is difficult due to the People Republic of China laws and regulations relating to intercorporate transfers and capital accounts.

Cash used in operating activities for the period ended December 31, 2016 was $190,577 as compared with $499,422 for the year ended May 31, 2016.

The Company has no other capital resources other than the ability to use its common stock to raise additional capital or the exercise of the warrants by the unit holders. If all warrants outstanding are exercised, the Company will receive approximately $5 million in cash. The Company’s current cash can meet its needs for at least the next 12 months. The cash will be mainly used for mining property exploration and development, general administrative, corporate (accounting, audit, and legal), financing and management.

No other commitments to provide additional funds have been made by management or other stockholders except as set forth above. Accordingly, there can be no assurance that any additional funds will be available to the Company to allow it to cover operation expenses. This raises substantial doubt that the Company will be able to continue as a going concern. In order to continue as a going concern, we require additional financing.

Off-Balance Sheet Arrangements

As of December 31, 2016 and May 31, 2016, we were not involved in any form of off-balance sheet arrangement.

Application of Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires that we make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ significantly from these estimates under different assumptions or conditions. There have been no material changes to these estimates for the periods presented in this report.

We believe that of our significant accounting policies, which are described in Note 2 to our annual financial statements, the following accounting policies involve a greater degree of judgment and complexity. Accordingly, the following policies are the most critical to aid in fully understanding and evaluating our financial condition and results of operations.

Foreign Currency Translation

(i) Functional and presentation currency

The financial statements of each entity in the Company are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in US dollars.

The functional currency of Sterling Group Ventures, Inc. is US dollars.
The functional currency of Sterling HK and Silver Castle is Hongkong dollars.
The functional currency of Hongyu is Renminbi (“RMB”).
The functional currency of the Company’s all other subsidiaries is US dollars.

The financial statements of Sterling HK, Silver Castle and Hongyu (“foreign operations”) are translated into the US dollar presentation currency as follows:

• Assets and liabilities – at the closing rate at the date of the balance sheets
• Income and expenses – at the average rate of the period (as this is considered a reasonable approximation of actual rates)

All resulting changes are recognized in other comprehensive income (loss) as translation adjustments.

When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from the item are considered to form part of the net investment in a foreign operation and are recognized in other comprehensive income.

When an entity disposes of its entire interest in a foreign operation, or loses control, joint control, or significant influence over a foreign operation, the foreign currency gains or losses accumulated in other comprehensive income related to the foreign operation are recognized in profit or loss.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency of an entity using the exchange rates prevailing at the dates of the transactions. Generally, foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in currencies other than an operation’s functional currency are recognized in the statement of operations and net loss.

Mineral Property Costs

Exploration and evaluation costs include costs to acquire exploration rights, geological studies, exploratory drilling and sampling and directly attributable administrative costs.

Exploration and evaluation costs relating to non-specific projects or properties or those incurred before the Company has obtained legal rights to explore an area are expensed in the period incurred. In addition, exploration and evaluation costs, other than direct acquisition costs, are expensed before a mineral resource is identified as having economic potential.

Exploration and evaluation costs are capitalized as mineral interests when a mineral resource is identified as having economic potential on a property. A mineral resource is considered to have economic potential when it is expected that documented resources can be legally and economically developed considering long-term metal prices. As at December 31, 2016 and May 31, 2016, the Company did not have proven or probable ore reserves.

Management reviews the carrying value of mineral properties at least annually and will recognize impairment in value based upon current exploration results, and any impairment or subsequent losses are charged to operations at the time of impairment. If a property is abandoned or sold, its capitalized costs are charged to operations.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes.

Significant estimates and judgement by management include: impairment considerations of long-lived assets, contingent liabilities related to pending litigation (note 9) and deferred taxes and ability to continue as a going concern. While the Company believes that the estimates and assumptions used in the preparation of the consolidation financial statements are appropriate, actual results could differ from those estimates.

Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

Going Concern

The Company’s financial statements have been prepared on a going concern basis which assumes that adequate sources of financing will be obtained as required, and that our assets will be realized and liabilities settled in the ordinary course of business. These consolidated financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary if we are unable to continue as a going concern.

In order to continue as a going concern, we require additional financing. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to continue as a going concern, we would likely be unable to realize the carrying value of our assets reflected in the balances set out in the preparation of the consolidated financial statements.

At December 31, 2016, the Company had not yet achieved profitable operations and has accumulated losses of $10,563,912 since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances, however there is no assurance of additional funding being available.

Sterling is transitioning to a technology company and the projects are not yet commercial and have not reached profitability.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In addition to the U.S. Dollar, we conduct our business in Chinese Yuan (RMB) and Canadian Dollar and, therefore, are subject to foreign currency exchange risk on cash flows related to expenses and investing transactions. In July 2005, the Chinese government began to permit the Chinese Yuan to float against the U.S. Dollar. All of our costs to operate our Chinese project are paid in Chinese Yuan and all of our costs to operate our principal executive office in Canada are paid in Canadian dollar. Our exploration costs in China may be incurred under contracts denominated in Chinese Yuan or U.S. Dollars. If the Chinese Yuan continues to appreciate with respect to the U.S. Dollar, our costs in China may increase. If the Canadian Dollar continues to appreciate with respect to the U.S. Dollar, our costs in Canada may increase and vice versa. To date we have not engaged in hedging activities to hedge our foreign currency exposure. In the future, we may enter into hedging instruments to manage our foreign currency exchange risk or continue to be subject to exchange rate risk. If the exchange rate increased by 10% , it is estimated that our costs would have been approximately $28,000 lower in the period ended December 31, 2016. If the exchange rate were 10% lower during the period from June 1, 2016 to December 31, 2016, our costs would increase by approximately $28,000.

Although inflation has not materially impacted our operations in the recent past, increased inflation in China or Canada could have a negative impact on our operating and general and administrative expenses, as these costs could increase. China has recently experienced inflationary pressures, which could increase our costs associated with our operations in China. If there are material changes in our costs, we may seek to raise additional funds earlier than anticipated.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	Page
Report of Independent Registered Public Accounting Firm	21
Consolidated Balance Sheets	22
Consolidated Statements of Operations	23
Consolidated Statements of Changes in Stockholders' Equity	24
Consolidated Statements of Cash Flows	25
Notes to the Consolidated Financial Statements	26-38

Report of Independent Registered Public Accounting Firm

To the Stockholders of Sterling Group Ventures, Inc.,

We have audited the accompanying consolidated balance sheet of Sterling Group Ventures, Inc. and its subsidiaries (the “Company”) as at December 31, 2016, and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the period from June 1, 2016 to December 31, 2016. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2016, and the consolidated results of its operations and its cash flows for the period from June 1, 2016 to December 31, 2016 in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, as at December 31, 2016, the Company had an accumulated loss of $10,563,912 since its inception. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management’s plans concerning these matters are also discussed in Note 1 to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty

Other Matter

The consolidated financial statements of Sterling Group Ventures, Inc. as at and for the year ended May 31, 2016 were audited by another auditor who expressed an unmodified opinion on these statements in their report dated September 15, 2016.

Vancouver, Canada	Chartered Professional Accountants
May 1, 2018	Licensed Public Accountants

STERLING GROUP VENTURES, INC.
CONSOLIDATED BALANCE SHEETS
Stated in U.S. dollars

			As at
	Note		December 31, 2016			May 31, 2016
ASSETS

Current Assets

Cash		$	736,586		$	907,158
Prepaid expenses and other receivable			15,972			12,620
Advance to Euroclub Holding Ltd.	5		554,477			-

Total current assets			1,307,035			919,778

Equipment	4		77			71,422
Environmental deposit, net of provision	3		1			1
Mineral Properties, net of provision	3		1			1

Total Assets		$	1,307,114		$	991,202

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

Accounts payable and accrued liabilities		$	424,031		$	426,566

Total Liabilities			424,031			426,566

Stockholders' Equity
Preferred Stock : $0.001 Par Value Authorized : 200,000,000; Issued and Outstanding : none	6		-			-
Common Stock : $0.001 Par Value Authorized : 500,000,000; Issued and Outstanding : 85,730,341 (May 31, 2016: 75,730,341)	6		85,730			75,730
Additional Paid In Capital			11,321,422			10,831,422
Share subscription received	6		97,392			-
Accumulated Other Comprehensive Loss			(57,549	)		(20,854	)
Accumulated deficit			(10,563,912	)		(10,321,662	)
Total Stockholders' Equity			883,083			564,636

Total Liabilities and Stockholders' Equity		$	1,307,114		$	991,202

See accompanying notes to consolidated financial statements

STERLING GROUP VENTURES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Stated in U.S. dollars

			Period from June 1, 2016			Year ended
	Note		to December 31, 2016			May 31, 2016
Expenses

Accounting, audit, legal and professional fees		$	112,921		$	67,451
Impairment of equipment	4		52,129			-
Mineral property costs	3		42,683			101,774
Consulting fees			34,814			20,035
Depreciation	4		15,910			32,138
Filing fees and transfer agent			9,022			8,610
Shareholder information and investor relations			6,451			6,700
Travel and entertainment			5,595			7,163
General and administrative			789			1,941
Bank charges			826			459
Impairment of mineral properties
and deposit	3		-			3,271,005
Due diligence costs	9		-			295,726
Project development cost	9		-			23,840
			(281,140	)		(3,836,842	)
Other items
Interest income, net			191			10,961
Foreign exchange gain			38,699			1,449
Net loss before income taxes			(242,250	)		(3,824,432	)

Current and deferred tax
Deferred tax recovery	10		-			732,687

Net loss		$	(242,250	)	$	(3,091,745	)

Other comprehensive loss, net of tax
Foreign currency translation adjustments			(36,695	)		(20,272	)

Comprehensive loss			(278,945	)		(3,112,017	)

Basic and diluted loss per share		$	(0.00	)	$	(0.04	)

Weighted average number of shares outstanding			76,945,294			75,730,341

See accompanying notes to consolidated financial statements

STERLING GROUP VENTURES, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
For the period from June 1, 2016 to December 31, 2016 and year ended May 31, 2016

					Stock						Accumulated
					Amount		Additional		Share		Other
		Common			At Par		Paid In		Subscription		Comprehensive			Accumulated
Stated in U.S. dollars	Note	Shares			Value		Capital		Received		Loss			Deficit			Total

Balance, May 31, 2015		75,730,341		$	75,730	$	10,831,422	$	-	$	(582	)	$	(7,229,917	)	$	3,676,653
Issuance of shares	6 (a), 9	93,000,000			-		-		-		-			-			-
Shares held in escrow	6 (a), 9	(93,000,000	)		-		-		-		-			-			-
Net loss for the year		-			-		-		-		-			(3,091,745	)		(3,091,745	)
Other comprehensive income		-			-		-		-		(20,272	)		-			(20,272	)
Balance, May 31, 2016		75,730,341		$	75,730	$	10,831,422	$	-	$	(20,854	)	$	(10,321,662	)	$	564,636
Issuance of shares	6 (a)	10,000,000			10,000		490,000		-		-			-			500,000
Share subscription received	6 (a)	-			-		-		97,392		-			-			97,392
Net loss for the period		-			-		-		-		-			(242,250	)		(242,250	)
Other comprehensive income		-			-		-		-		(36,695	)		-			(36,695	)
Balance, December 31, 2016		85,730,341		$	85,730	$	11,321,422	$	97,392	$	(57,549	)	$	(10,563,912	)	$	883,083

STERLING GROUP VENTURES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Stated in U.S. dollars

		Period from June 1, 2016			Year ended
		to December 31, 2016			May 31, 2016
Cash flows from operating activities
Net loss	$	(242,250	)	$	(3,091,745	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		15,910			32,138
Foreign exchange gain		(38,699	)		(1,449	)
Impairment of equipment		52,129			-
Impairment of mineral properties and
deposit		-			3,271,005
Deferred tax recovery		-			(732,687	)

Changes in non-cash working capital items
Prepaid expenses and other receivable		(3,537	)		(260	)
Accounts payable and accrued liabilities		25,870			23,576
Net cash used in operating activities		(190,577	)		(499,422	)

Cash flows from investing activity
Advance to Euroclub Holding Ltd.		(554,477	)		-
Additions to equipment		-			(733	)
Net cash used in investing activity		(554,477	)		(733	)

Cash flows from financing activity
Share subscription received		97,392			-
Proceeds from issuance of shares		500,000			-
Amounts repaid to directors		(28,401	)		(17,969	)
Net cash provided by (used in) financing activity		568,991			(17,969	)

Effects of foreign currency exchange rate changes in cash		5,490			(7,827	)

Net decrease in cash		(176,063	)		(518,124	)
Cash - beginning balance		907,158			1,433,109
Cash - ending balance	$	736,586		$	907,158

Supplemental Information :
Cash paid for :
Interest	$	-		$	-
Income taxes	$	-		$	-

See accompanying notes to consolidated financial statements

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 1 - Nature of Operations and Ability to Continue as a Going Concern

Sterling Group Ventures, Inc. (“the Company”) was incorporated in the State of Nevada on September 13, 2001 and its fiscal year-end was May 31. On April 14, 2017, the Board of Directors approved the change in the Company’s fiscal year end to December 31. The Company was in the business of exploring and developing mineral property located in China.

On November 11, 2016, the Company signed a definitive share exchange agreement with Euroclub Holding Ltd. (“Euroclub”) to acquire all of the issued and outstanding shares of Euroclub and its wholly owned subsidiary companies. The transaction was closed on January 11, 2017 (Note 11). The business combination will be accounted for as a reverse acquisition whereby the purchase method of accounting was used with Euroclub being the accounting acquirer and the Company being the accounting subsidiary upon the completion of the transaction.

Euroclub is a well-established online gaming company, with gaming licenses in Malta and Curacao, providing business-to-business (“B2B”) and business-to-customers (“B2C”) multi-gaming platform under the “Mojo” brand name with a full suite of social and real money gaming products, including online poker, casino games, and third party integrations to live dealer, e-sports, sports betting and skill games. Euroclub has business in Brazil, Russia, India, China and Europe. Mojo offers B2B partners both API integrated and turnkey white label licensing options with comprehensive global payment processing. The Mojo technology is a robust, well established architecture that supports a flexible, customized suite of products for end customers. In addition to Mojo’s multiplayer poker, casino and skill games, Mojo offers multiple 3rd party content providers that are tightly integrated to and managed by Mojo’s back office and state-of-the-art security systems. Mojo supports over 40 payment processors with 24/7 customer support and security and fraud management with multicurrency and multilingual solutions. Mojo hosts affiliate, agent and sub-agent systems and provides solutions for social-play money and land based casinos. Mojo’s technology is a key differentiator that allows the Company to continue to win business from much larger competitors.

Euroclub’s registered office is in Malta with 25 technical staff in Vancouver, Dublin and Barcelona and support over 20 B2B partners and B2C operations with gaming licenses in Malta and Curacao.

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. Realization values may be substantially different from carrying values as shown as these consolidated financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. The Company incurred a net loss of $242,250 during the period ended December 31, 2016 and, as at that date, had a cumulative loss of $10,563,912 since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management raised additional funds of $500,000 and $703,992 by equity financing during the period ended December 31, 2016 (Note 6(a)) and in April 2017 (Note 11), respectively. Management is in the process of raising additional equity financing for working capital purpose and there is no guarantee that these additional equity financing can be raised.

Note 2 - Summary of Significant Accounting Policies

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America “US GAAP”). Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of consolidated financial statements for a period necessarily involves the use of estimates, which have been made using careful judgement. Actual results may vary from these estimates.

The consolidated financial statements have, in management’s opinion, been properly prepared within the framework of the significant accounting policies summarized below:

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 2 - Summary of Significant Accounting Policies – Continued

Principles of Consolidation

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Micro Express Holdings Inc., Micro Express Ltd., Huyana Ventures Limited, Makaelo Holdings Inc., Makaelo Limited, Sterling Group Ventures (HK) Limited (“Sterling HK"), Silver Castle Investments Ltd. (“Silver Castle”) and its 100% controlled subsidiary, Chenxi County Hongyu Mining Co. Ltd. ("Hongyu").

Information about subsidiaries:

Name	Principal activities	Country of incorporation

Micro Express Holding Inc.	Holding Company	Territory of the British Virgin Islands
Micro Express Ltd.	Holding Company	Territory of the British Virgin Islands
Huyana Ventures Limited	Holding Company	Territory of the British Virgin Islands
Makaelo Holdings Inc.	Holding Company	Territory of the British Virgin Islands
Makaelo Limited	Holding Company	Territory of the British Virgin Islands
Sterling HK (Disposed in August 2016)	Holding Company	Hong Kong
Silver Castle	Holding Company	Hong Kong
Hongyu (Dissolved in 2017)	Mineral Exploration	China

Subsidiaries are all entities (including structured entities) over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases.

Foreign currency translation

(i) Functional and presentation currency

The financial statements of Sterling HK, Silver Castle and Hongyu (“foreign operations”) are translated into the US dollar presentation currency as follows:

Assets and liabilities – at the closing rate at the date of the balance sheets
Income and expenses – at the average rate of the period (as this is considered a reasonable approximation of actual rates)

All resulting changes are recognized in other comprehensive income (loss) as translation adjustments.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 2 - Summary of Significant Accounting Policies – Continued

Foreign currency translation - continued

(ii) Transactions and balances

Mineral Properties

Exploration and evaluation costs include costs to acquire exploration rights, geological studies, exploratory drilling and sampling and directly attributable administrative costs.

Asset Retirement Obligations

The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made. The carrying amount of the related long-lived asset is increased by the same amount as the liability.

Changes in the liability for an asset retirement obligation due to the passage of time will be measured by applying an interest method of allocation. The amount will be recognized as an increase in the liability and an accretion expense in the statement of operations. Changes resulting from revisions to the timing or the amount of the original estimate of undiscounted cash flows are recognized as an increase or a decrease in the carrying amount of the liability for an asset retirement obligation and the related asset retirement cost capitalized as part of the carrying amount of the related long-lived asset. No asset retirement obligation was required to be recognized at December 31, 2016 and May 31, 2016.

Property and Equipment

Property and equipment is stated at cost. Depreciation is primarily computed using the straight-line method, by charges to operations in amounts estimated to allocate the cost of the assets over their estimated useful lives, as follows:

Asset classification		Estimated useful life

Computer equipment		3 years
Automobile		5 years
Office equipment		3 years
Machinery		3 to 10 years

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 2 - Summary of Significant Accounting Policies - Continued

Impairment of Long-lived Assets

In accordance with ASC Topic 360-10, “Property, Plant and Equipment - Overall”, the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.

Comprehensive Loss

The Company reports comprehensive income (loss) in accordance with ASC Topic 220-10, “Comprehensive Income - Overall”. Comprehensive loss primarily differs from net loss due to foreign currency translation adjustments.

Earnings per Share (EPS)

The Company reports basic and diluted earnings per share in accordance with the ASC Topic 260-10, “Earnings Per Share - Overall”. Basic EPS is computed using the weighted average number of shares outstanding during the period. Diluted EPS is computed similar to basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued.

At December 31, 2016, the Company had 39,770,000 (May 31, 2016 - 29,770,000) common share equivalents in respect to options and warrants. Because the Company incurred a loss, the dilutive impact of the outstanding options and warrants have been excluded as the impact would be anti-dilutive.

Income Taxes

The Company accounts for income taxes under the provisions of ASC Topic 740, “Income Taxes” . Under ASC Topic 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income taxes are provided using the liability method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax basis of an asset or liability is the amount attributed to that asset or liability for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in income in the period of change. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion of, or all of, the deferred tax assets will not be realized.

ASC Topic 740 contains a two-step approach to recognizing and measuring uncertain tax positions taken or expected to be taken in a tax return. The first step is to determine if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained in an audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company recognizes interest and penalties accrued on unrecognized tax benefits within general and administrative expense. To the extent that accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in general and administrative expenses in the period that such determination is made. The tax returns for fiscal year 2012 through 2016 are subject to audit or review by the US tax authority, whereas fiscal year 2008 through 2016 are subject to audit or review by the Canadian tax authority.

Use of Estimates

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 2 - Summary of Significant Accounting Policies - Continued

Use of Estimates - continued

Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

Fair Value of Financial Instruments

The Company applies the provisions of ASC 820, “Fair Value Measurements and Disclosures". ASC 820 defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles and enhances disclosures about fair value measurements. Fair value is defined under ASC 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level I, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company did not have any assets or liabilities stated at fair value utilizing Level 1, Level 2 or Level 3 inputs as at December 31, 2016 and May 31, 2016.

The Company’s consolidated financial instruments consist of cash, other receivables, advance to Euroclub Holding Ltd. and accounts payable and other accrued liabilities. The carrying values of the Company’s financial instruments approximate fair value due to the short maturity of these instruments. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these consolidated financial instruments.

Recent Accounting Pronouncements

The Company has evaluated all the recent accounting pronouncements and believes that none of them will have a material effect on the Company’s consolidated financial statements.

a. Accounting standards adopted

On June 1, 2016, the Company adopted FASB issued Accounting Standard Update (ASU) 2014-12, “Accounting for Share-Based Payments When the Terms of an Award Allow a Performance Target to Be Achieved After the Requisite Service Period”, which requires that a performance target that could be achieved after the requisite service period be treated as a performance condition that affects the vesting of the award. The Company applies the amendments in ASU 2014-12 prospectively to all awards granted or modified after the effective date. Adoption of the new update to ASU 2014-12 did not have any impact on the consolidated financial statements of the Company.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 2 - Summary of Significant Accounting Policies - Continued

Recent Accounting Pronouncements - continued

b. Accounting standards not yet adopted

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers”. This guidance, as amended by subsequent ASUs on the topic, supersedes current guidance on revenue recognition in Topic 605, Revenue Recognition. This guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods. Early application of the guidance is permitted for annual reporting periods beginning after December 31, 2016. The Company is currently evaluating this guidance to determine the potential impact on its consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern,” which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if “conditions or events raise substantial doubt about the entity’s ability to continue as a going concern.” The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is currently assessing the impact the new standard will have on the consolidated financial statements.

In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes ”. ASU 2015-17 requires deferred tax assets and liabilities, along with related valuation allowances, to be classified as non-current on the balance sheet. Each tax jurisdiction will now only have one net non-current deferred tax asset or liability. The new guidance does not change the existing requirement that prohibits offsetting deferred tax liabilities from one jurisdiction against deferred tax assets of another jurisdiction. The guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is permitted. The Company does not expect the adoption of this update to have a material effect on the Company’s consolidated financial statements.

In February 2016, FASB issued ASU 2016-02, “Leases”, which requires the recognition of lease assets and lease liabilities on the balance sheet by lessees for those leases currently classified as operating leases under ASC 840 “Leases.” These amendments also require qualitative disclosures along with specific quantitative disclosures. These amendments are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. Entities are required to apply the amendments at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact that the standard will have on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting ”, which modifies the accounting for excess tax benefits and tax deficiencies associated with share-based payments, the accounting for forfeitures, and the classification of certain items on the statement of cash flows. ASU 2016-09 eliminates the requirement to recognize excess tax benefits in additional paid-in capital ("APIC"), and the requirement to evaluate tax deficiencies for APIC or income tax expense classification, and provides for these benefits or deficiencies to be recorded as an income tax expense or benefit in the income statement. With these changes, tax-related cash flows resulting from share-based payments will be classified as operating activities as opposed to financing, as currently presented. The standard is effective for the Company in the first quarter of fiscal year 2018, although early adoption is permitted. We are currently assessing the impact the new standard will have on our consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 significantly changes the impairment model for most financial assets and certain other instruments. ASU 2016- 13 will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of allowances for credit losses on loans and other financial instruments. the amendments in this Update are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the impact the adoption of ASU 2016-13 will have on the Company's consolidated financial statements.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 3 - Mineral Properties

A summary of mineral property costs for the period ended December 31, 2016 and year ended May 31, 2016 were incurred and accounted for in the consolidated statement of operations as follows:

Summary of mineral property expenditures		Gaoping Phosphate Property

Balance, May 31, 2015	$	1,074,701
Administrative		3,362
Consulting fees		16,323
Mining permit		10,922
Travel & promotion		13,092
Wages and benefits		58,075
Balance, May 31, 2016	$	1,176,475
Administrative		3,026
Consulting fees		4,272
Travel & promotion		5,544
Wages and benefits		29,841
Balance, December 31, 2016	$	1,219,158

a. Gaoping Phosphate Property

During the period ended December 31, 2016, the Company incurred mineral property expenditures of $42,683 (year ended May 31, 2016: $101,774). As of December 31, 2016, the Company has incurred total mineral property costs of $1,219,158 (May 31, 2016: $1,176,475) on this property which have been expensed to the statement of operations as disclosed in the table above.

On May 31, 2016, in accordance with its accounting policy, the Company performed an impairment test on the carrying value of the Gaoping Phosphate Property. Due to the prolonged and significant decline in the phosphate price and the lack of planned exploration program on the property, the Company recorded impairment provisions to the full amount of mineral properties and its related environmental deposit of $3,147,801 and $123,204, respectively, during its fiscal year ended May 31, 2016.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 4 - Equipment

	Computer Equipment		Automobile		Office Equipment		Machinery		Total

Cost

May 31, 2015	14,126		60,256		3,590		164,625		242,597

Addition	733		-		-		-		733

Foreign exchange difference	(117	)	(3,518	)	(209	)	(9,613	)	(13,457	)

May 31, 2016	14,742		56,738		3,381		155,012		229,873

Foreign exchange difference	(119	)	(2,957	)	(177	)	(8,441	)	(11,693	)

Impairment	(2,171	)	(53,781	)	(3,204	)	(146,571	)	(205,728	)

December 31, 2016	12,452		-		-		-		12,452

Accumulated Depreciation

May 31, 2015	13,809		38,801		3,590		78,088		134,288

Addition	678		8,617		850		21,994		32,138

Foreign exchange difference	(414	)	544		(1,059	)	(7,046	)	(7,975	)

May 31, 2016	14,073		47,962		3,381		93,035		158,451

Addition	213		6,430		-		9,267		15,910

Foreign exchange difference	(97	)	(2,704	)	(177	)	(5,409	)	(8,387	)

Impairment	(1,814	)	(51,688	)	(3,204	)	(96,893	)	(153,599	)

December 31, 2016	12,375		-		-		-		12,375

Net Book Value

May 31, 2015	317		21,455		-		86,537		108,309

May 31, 2016	669		8,776		-		61,977		71,422

December 31, 2016	77		-		-		-		77

The depreciation for the period ended December 31, 2016 was $15,910 (year ended May 31, 2016: $32,138).

On December 31, 2016, due to the dissolvement of Hongyu (Note 11), the Company recorded impairment provisions on Hongyu’s equipment of $52,129 (year ended May 31, 2016: $Nil).

Note 5 - Related Party Transactions and Balances

The Company was charged by companies controlled by directors and former directors for administrative, corporate, financial, engineering, and management services during the period ended December 31, 2016 totalling $24,747 (year ended May 31, 2016: $18,019).

Included in accounts payable and accrued liabilities is $368,780 (May 31, 2016: $397,181) which was due to companies controlled by the directors and former directors for their services provided in previous years.

During the period ended and as of December 31, 2016, the Company advanced $554,477 (May 31, 2016: $Nil) to Euroclub for general working capital purpose. The advance is non-interest bearing and repayable on demand.

These transactions were measured at the amount of consideration established and agreed to by the related parties.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 6 - Capital Stock

a) Capital Stock

There were 93,000,000 shares issued in escrow during the year ended May 31, 2016 in connection with the Purchase and Sales Agreement and were then cancelled on September 9, 2016 (Note 9).

On December 6, 2016, the Company issued 10,000,000 share units at $0.05 each to its subscribers. Each share unit consists of one common share and one Series “F” share purchase warrant exercisable at the price of $0.15 per share, expiring on December 6, 2017 for $500,000 received.

On December 6, 2016, the Company amended its Articles of Incorporation to authorize the Company to issue up to a total of 700,000,000 shares of all classes of stock; consisting of 200,000,000 shares of preferred stock, par value $0.001 per share (hereinafter the “Preferred Stock”), and 500,000,000 shares of common stock, par value $0.00l per share (hereinafter the “Common Stock”). The terms and limitations of each series of Preferred Stock will be determined by the Board of Directors without shareholders’ approval.

As of December 31, 2016, the Company received share subscriptions in sum of $97,392 for 1,096,600 share units. Among these share units, 736,600 share unit consists of one common share and one Series "G" warrants exercisable at the price of $0.15 per share with a term of 1 year. The remaining 360,000 share unit consists of one common share and one Series "E" warrants exercisable at the price of $0.15 per share with a term of 1 year. The shares are issued subsequent to December 31, 2016 (Note 11).

b) Stock Options

There were no stock options granted during the period ended December 31, 2016 and year ended May 31, 2016.

At December 31, 2016, there were 5,200,000 stock options (May 31, 2016: 5,200,000) outstanding and exercisable with an exercise price at $0.25 each expiring on February 3, 2019, with an aggregate intrinsic value of $nil (May 31, 2016: $nil).

c) Share Purchase Warrants

On December 6, 2016, the Company issued 10,000,000 Series “F” share purchase warrants exercisable at the price of $0.15 per share, expiring on December 6, 2017. The fair value of the 10,000,000 Series “F” Share Purchase Warrants was $Nil as the share price was under the market quoted price on the day of issuance.

At December 31, 2016, there were 34,570,000 share purchase warrants (May 31, 2016: 24,570,000) outstanding and exercisable with weighted average exercise price at $0.189.

c) Share Purchase Warrants - continued

Series	Number		Price	Expiry Date
"A"	3,817,500	$	0.50	February 17, 2017	*
"D"	20,752,500	$	0.15	February 17, 2017	*
"F"	10,000,000	$	0.15	December 6, 2017
	34,570,000

*All outstanding share purchase warrants have expired. (Note 11).

Note 7 - Foreign Currency Risk

The Company is exposed to fluctuations in foreign currencies through amounts held in China in RMB: Cash $20,986 (May 31, 2016 - $30,615).

The Company is exposed to fluctuations in foreign currencies through amounts held in Canada in CAD: Cash $15,508 (May 31, 2016 - $15,595).

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 8 - Segment Information

The Company has offices in Canada and China, with operations in one segment only, i.e. mineral resources sector. The Company’s assets are allocated to each country as follows:

		December 31, 2016						May 31, 2016
		Canada		China		Total		Canada		China		Total

Cash	$	21,333	$	715,253	$	736,586	$	132,382	$	774,776	$	907,158
Prepaid expense and receivable		14,432		1,540		15,972		6,438		6,182		12,620
Advance to Euroclub		554,477		-		554,477		-		-		-
Equipment		77		-		77		154		71,268		71,422
Environmental deposit		-		1		1		-		1		1
Mineral properties		-		1		1		-		1		1
	$	590,319	$	716,795	$	1,307,114	$	138,974	$	852,228	$	991,202

Note 9 - Purchase and Sales Agreement

On April 9, 2016, the Company signed a Purchase and Sale Agreement (“Agreement”) with Chenguo Capital Limited (“Chenguo”). As a result of the transaction, the Company had plans to diversify and become a timeshare exchange provider, a manager of timeshare assets through agreements, and a developer of timeshare assets with fee relationships with other organizations or resorts.

Under the terms of the Agreement, the Company would be required to issue 85,000,000 shares on April 19, 2016 to Chenguo. Pursuant to an escrow agreement, the 85,000,000 shares were contingently issuable and only released from escrow upon completion of the transaction and when the timeshare assets are transferred to the Company. In connection with this agreement, the Company also issued 8,000,000 shares, pursuant to an escrow agreement, representing a finder’s fee to be released on completion of the transaction.

The Company also remitted RMB1,895,353 ($295,726) to the other party on April 22, 2016 for the development of the timeshare platform. The amount has been recorded as “project development cost” during the year ended May 31, 2016.

During the year ended May 31, 2016, the Company also expensed $23,840 for expenses incurred by the other parties affiliated with Chenguo termination in “due diligence cost” in the consolidated statement of operations.

On September 5, 2016, both parties agreed to terminate the Agreement and the Company agreed to reimburse the parties to the Agreement HK$125,000 ($16,090) on the related expenses incurred.

Pursuant to the termination agreement, on September 9, 2016, the Company cancelled the 85,000,000 escrow shares and 8,000,000 shares issued as finder’s fees, subject to the escrow agreement. Sterling HK was hereby transferred back to Chenguo for 1.00 HK dollar free and clear of all liens, claims and debts assignments, transfers, deeds, quit claims, novation agreements.

The Company has determined there is a contingent liability related to the cancellation of the 8,000,000 shares related to the finder’s fee . Based on the early stage of the claim and evaluation of the facts available at this time, the amount or range of reasonably possible losses to which the Company is exposed cannot not be estimated and the ultimate resolution of this matter and the associated financial impact to the Company, if any, remains uncertain at this time. We believe the claim is without merit and intend to defend ourselves vigorously.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 10 - Deferred Tax Assets

The Company and its subsidiaries are subject to income tax laws in their respective tax jurisdictions, which are the same as their respective place of incorporation.

The following table reconciles the income tax benefit at the U.S. Federal statutory rate to income tax benefit at the Company's effective tax returns.

	For the period ended		For the year ended
	December 31, 2016		May 31, 2016
	$		$
Net loss before tax	(242,250	)	(3,091,745	)
Statutory tax rate	35.00%		35.00%
Expected income tax expense (recovery)	(84,788	)	(1,082,100	)
Non-deductible items	185		-
Change in estimates	(435,760	)	-
Change in enacted tax rate	38,019		-
Foreign currency adjustments	13,200		-
Foreign tax rate difference	12,093		282,200
Change in valuation allowance	457,051		67,213
Income tax expense (recovery)	-		(732,687	)

Deferred taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their corresponding values for tax purposes.

Deferred tax assets (liabilities) as at December 31, 2016 and May 31, 2016 are as follows:

	December 31, 2016		May 31, 2016
	$		$
Equipment - U.S.	1,695		2,300
Stock based compensation - U.S.	1,096,800		1,096,800
Net operating losses - U.S.	1,263,976		814,850
Equipment - China	46,367		31,190
Mineral property - China	51,578		54,500
Non capital losses - China	140,895		149,350
Non capital losses - Hong Kong	6,740		2,010
Valuation allowance	(2,608,051	)	(2,151,000	)
Net deferred tax asset (liability)	-		-

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 10 - Deferred Tax Assets - Continued

As at December 31, 2016, the Company has non-capital loss carry forwards for the U.S. income tax purposes of approximately $3,611,359 from the Company's U.S. entity available to reduce taxable income in U.S.:

U.S.

Expiry		$
2036		468,358
2035		263,326
2034		397,306
2032		396,266
2031		170,618
2030		122,000
2029		161,553
2028		106,915
2027		864,485
2026		461,201
2025		199,331
TOTAL		3,611,359

As at December 31, 2016, the Company has non-capital loss carry forwards for Chinese income tax purposes of approximately $563,578 from the Company's China subsidiary available to reduce taxable income in China:

China

Expiry		$
2020		93,169
2019		154,823
2018		315,586
TOTAL		563,578

The Company also has $40,850 of non-capital loss carry forwards for the period ended December 31, 2016 that may be carried forward indefinitely to apply against future income for Hong Kong income tax purposes, subject to the final determination by taxation authorities.

Note 11- Subsequent Events and Commitments

In February 2017, the Company paid an individual for consulting services in sum of $9,000 which was settled by issuance of 360,000 shares and 360,000 Series “E” warrants exercisable at $0.15 each expiring on February 24, 2018. All the shares and shares to be issued upon exercise of warrants will be subject to Rule 144 restrictions, i.e. these restricted shares are not tradable on the market within 6 months after issuance.

The reverse takeover transaction with Euroclub Holding Ltd. was completed on January 11, 2017. On the same date, the Company issued 170,285,696 common shares and 791,500 redeemable and exchangeable preferred shares to Euroclub's shareholders. Each preferred is redeemable at $5, subject to conditions, or exchangeable for 25 Sterling common shares per preferred share. For each exchangeable common share the owner is entitled, 5 warrants were issued exercisable at $0.15 each with a term of 3 years.

On February 16, 2017, the Company extended the expiry date of 3,817,500 Series "A" Share Purchase Warrants (the "A" Warrants) to the earlier of May 17, 2017 or the close of business on the 30th day after a takeover bid for the Company's issued and outstanding share capital has been made by a third party and approved by the shareholders of the Company. Upon exercise of the Series "A" Share Purchase Warrants at $0.50 each, the holder will receive one Common Share of the Company and a Series "B" Share Purchase Warrant exercisable at $1.00 for another year. The Series "A" Share Purchase Warrants were originally issued pursuant to a private placement commenced in February 2004.

Sterling Group Ventures, Inc.
Notes to the Consolidated Financial Statements
December 31, 2016
(Stated in US Dollars)

Note 11- Subsequent Events and Commitments - Continued

The Company extended the expiry date of 20,752,500 Series "D" Share Purchase Warrants (the "D" Warrants) to the earlier of September 17, 2017 or the close of business on the 30th day after a takeover bid for the Company's issued and outstanding share capital has been made by a third party and approved by the shareholders of the Company. The exercise price of the "D" Warrants remains unchanged at $0.15 per share. The Series "D" Share Purchase Warrants were originally issued pursuant to a private placement commenced in December 2010.

The expiry date of the Series "A" and "D" Warrants will be accelerated at any time prior to the extended expiry date of the Warrants to the close of business on the 30th day after the day on which the closing price of the Company's shares exceeds 25 cents for a period of 20 consecutive trading days.

All outstanding share purchase warrants are subsequently expired.

On April 21, 2017, the Company has closed a $703,992 private placement. Under the terms of the private placement, the Company issued 5,866,600 common shares at $0.12 and 5,866,600 Series "G" warrants with exercise price of $0.15 with a term of 1 year, expiring April 21, 2018.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

a. Evaluation of Disclosure Controls and Procedures:

The management of the Company including its chief executive officer and chief financial officer has evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) under the Exchange Act), as of the end of the period covered by this report and has concluded that the disclosure controls, and procedures were effective based upon their evaluation as of the end of the period covered by this report.

b. Management's Report on Internal Control over Financial Reporting

The Company’s management, including our chief executive officer and chief financial officer, is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed by, or under the supervision of, our chief executive and chief financial officers and implemented by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. Because of their inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an assessment of the effectiveness of the design and operation of the Company’s internal controls over financial reporting based on certain criteria established in Internal Control – Integrated Framework (1992 edition) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the Company’s internal control over financial reporting is effective as of December 31, 2016.

c. Changes in Internal Control over Financial Reporting:

There were no changes in the Company’s internal control over financial reporting identified in connection with the Company’s evaluation required by paragraph (d) of Rule 13a-15 or Rule 15d-15 under the Exchange act that during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

All directors of the Company hold office until the next annual general meeting of the shareholders or until their successors are duly elected and qualified. The officers of our company are appointed by our board of directors and hold office until the earlier of death, retirement, resignation or removal.

Our directors, executive officers and other significant employees, their ages, positions held and duration each person has held that position, are as follows:

Name	Position Held with the Company	Age	Date First Elected / Appointed
Nicolaos Mellios	Chairman of the Board, CEO	48	November 11, 2016
Chris Tsakok	Director	37	July 18, 2014
Robert Smiley	Director	73	June 6, 2007
Chris Ruck	CTO	53	November 11, 2016
Sachin Pawa	Director	39	November 11, 2016
Patrick Martin	Director	40	November 11, 2016
Chris MacPherson	Director, CFO	53	December 6, 2016

Business Experience

The following sets forth the business experience of each of the Company's directors and executive officers:

Nicolaos Mellios, Chairman & CEO

Mr. Nick Mellios has been appointed as CEO and Chairman of the Board as of November 11 ^th , 2016. Mr. Nick Mellios, BSc, MBA, is responsible for overall technical and strategic management, and brings a broad background in technology and business development to his lead role at Euroclub. As co-founder and CEO, he has been responsible for raising financing, and assembling the technical and operations teams to build and support Euroclub's iGaming platform. He also leads business development efforts negotiating agreements with on-line and land-based gaming operators, and third party gaming providers. Prior to Euroclub, Mr. Mellios was the CEO of Yummy Interactive. Mr. Mellios co-founded Yummy to build a games-on-demand distribution and DRM (digital rights management) solution for mobile/broadband service providers, and application/game developers and publishers. Prior to Yummy, Nick held positions in New Business Development and Program Controls and Management at Hughes Aircraft. He graduated from the University of British Columbia with an MBA and a bachelor of science in mathematics.

Chris Ruck, Chief Technology Officer

Chris Ruck will become the company’s CTO. Chris has created and manages Mojo’s technology, architecture and ongoing IP development. Chris has over 25 years of experience specializing in architecting and deploying back-office systems, multiplayer games, DRM solutions and billing systems previously for Look Communications, Yummy Interactive, Euroclub and now Mojo. Chris has been with the company since inception from 2010.

Christopher L. MacPherson, Director, Chief Financial Officer

Mr. Christopher MacPherson has joined the Company as Director and CFO. He has spent 25 years at CIBC Wood Gundy as Vice President & Portfolio Manager. Chris has extensive experience in the capital markets and is co-founder of Mojo. Chris will be responsible for finance and marketing activities, funding and acquisition opportunities as well as assist in strategic and tactical matters. He has sat on a number of boards including BC Hydro and been quite active on the political stage. He has also been involved in a number of charities including Children's Miracle and Nepal House Society.

Chris Tsakok, Director, Chairman of the Audit Committee

Mr. Tsakok has been in the investment business for the past 10 years. He is President and CEO of Richco Investors, Inc., a company whose principal business is to provide financial, management and other administrative services to early development stage business. He holds a Bachelor of Commerce (B.Comm.), an MBA degree, and is a Chartered Financial Analyst (CFA).

Robert G. Smiley, J. D, Director

Mr. Smiley is a business consultant working with junior companies. He has been self-employed in this capacity for the past ten years. He is a former lawyer who specialized in oil and gas and securities law for twenty-five years. He is currently a director of Richco Investors Inc, Canadian Imperial Ventures Corp., Teuton Resource Corp. and Silver Grail Resources Inc. He has served on the boards of a number of junior and intermediate companies in the past.

Patrick Martin, Director

Patrick Martin, BSc, MBA, is the principal of business strategy at Zappos since 2014 and one of the architects of the current best customers strategy. He has expanded the data science and business intelligence capabilities of the organization. He has additionally held previous roles as a product manager at Zappos, and a senior engineer and development director at Electronic Arts Sports. Mr. Martin's areas of expertise include business strategy, technology management, big data and on-line/direct marketing. He received his BSc in Computer Software Engineering from the University of British Columbia and received his MBA from Northwestern University's Kellogg School of Management.

Sachin Pawa

Sachin Pawa, BBA, MBA, has over 10 years of experience in building gaming ventures in India. He co-founded and developed Sol Entertainment Private Ltd., the operating company of the Crown Casino in Goa, India. He was the chief executive officer of Online for Playwin, India's largest licensed lottery business. He was also the co-founder and CEO of Blue Square Services, which operated the site Maharjahclub and was licensed in the United Kingdom. He has also set up and managed various successful retail stores and operations for distribution of mobile devices, including partnerships with the major network carriers in the United States. He graduated from the University of Technology, Sydney, Australia, with an MBA and from the Apeejay School Of Management in Delhi, India, with a BBA.

Our directors, executive officers and control persons have not been involved in any of the following events during the past five years:

	1.	any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
	2.	any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offences);
	3.	being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
	4.	being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

Audit Committee and Charter

We have an audit committee and audit committee charter. Our audit committee is comprised of Mr. Christopher Tsakok, Chris MacPherson and Mr. Robert Smiley. Mr. Christopher Tsakok qualifies as an "audit committee financial expert" as defined in Item 407(5)(ii) of Regulation S-K. We believe that the audit committee members are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. During the year ended December 31, 2016, the audit committee met eight times. A copy of our audit committee charter is filed as an exhibit to the Form 10-K on August 28, 2009.

The Audit Committee's responsibilities include:

selecting and reviewing our independent registered public accounting firm and their services;
reviewing and discussing the audited financial statements, related accounting and auditing principles, practices and disclosures with the appropriate members of management;
reviewing and discussing our quarterly financial statements prior to the filing of those quarterly financial statements;
establishing procedures for the receipt of, and response to, any complaints received regarding accounting, internal accounting controls, or auditing matters, including anonymous submissions by employees;
reviewing the accounting principles and auditing practices and procedures to be used for the audit of our financial statements and reviewing the results of those audits; and
monitoring the adequacy of our operating and internal controls as reported by management and the independent registered public accounting firm.

Code of Ethics

We have adopted a corporate code of ethics that applies to all employees, including our directors and officers. A copy of the code of ethics is filed as an exhibit to the Form 10-K on August 28, 2009. We believe our code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.

ITEM 11. EXECUTIVE COMPENSATION

(a) Officers' Compensation.

Compensation paid by the Company for all services provided up to the period ended December 31, 2016 and May 31, 2016 to each of the executive officers and to all officers as a group is set forth below.

SUMMARY COMPENSATION TABLE OF EXECUTIVES
(For December 31, 2016 and May 31, 2016)

		Cash Compensation			Security Grants	TOTAL ($)
Name and Principal Position	Period ended December 31,	Salary ( $) (1)	Bonus ($)	All Other Compensation ( $) (2)	Option Awards ($)(3)	TOTAL ($)
Richard Shao President (resigned on April 3, 2016)	Dec 31, 2016	0	0	0	0	0
Richard Shao President (resigned on April 3, 2016)	May 31, 2016	0	0	0	0	0
Christopher Tsakok Chairman & CEO resigned November 11, 2016)	Dec 31,2016	0	0	2,979	0	2,979
	May 31, 2016	0	0	0	0	0
Chris MacPherson, CFO	Dec 31, 2016	0	0	11,172	0	11,172
Kathy Wang Secretary	Dec 31, 2016	0	0	10,596	0	10,596
Kathy Wang Secretary	May 31, 2016	0	0	18,019	0	18,019
Nicolaos Mellios, CEO & Chairman	Dec 31, 2016	0	0	0	0	0
Officers as A Group	Dec 31, 2016	0	0	24,747	0	24,747
	May 31, 2016	0	0	18,019	0	18,019

(1)	Executive officers did not receive any salary during the period ended December 31, 2016 or May 31 2016.
(2)	The amounts listed under the Column entitled “All other Compensation” in the “Summary Compensation Table” related to consulting fees earned during the period reported.
(3)	Please refer Note 6(b) to the financial statements included herein.

(b) Directors' Compensation

Directors who are also officers receive no cash compensation for services as a director. However, the directors will be reimbursed for out-of-pocket expenses incurred in connection with attendance at board and committee meetings. The Company granted options to directors under its 2004 Incentive Stock Option Plan subsequently adopted.

SUMMARY COMPENSATION TABLE OF DIRECTORS
(For December 31, 2016 and May 31, 2016)

		Cash Compensation			Security Grants		TOTAL ($)
Name and Principal Position	Year ended May 31,	Annual Retainer Fees ($)	Meeting Fees ($)	Consulting Fees/ Other Fees ( $)	Option Awards ($)(1)	All Other Compensation ($)	TOTAL ($)
Christopher Tsakok Director	Dec 31, 2016	0	0	2,979	0	0	2,979
Christopher Tsakok Director	May 31, 2016	0	0	0	0	0	0
Richard Shao Director (resigned on April 3, 2016)	Dec 31, 2016	0	0	0	0	0	0
Richard Shao Director (resigned on April 3, 2016)	May 31, 2016	0	0	0	0	0	0
Gerald Runolfson Director ( resigned on November 7, 2016)	Dec 31, 2016	0	0	0	0	0	0
Gerald Runolfson Director ( resigned on November 7, 2016)	May 31, 2016	0	0	0	0	0	0
Robert G. Smiley Director	Dec 31, 2016	0	0	0	0	0	0
Robert G. Smiley Director	May 31, 2016	0	0	0	0	0	0
Chris L MacPherson Director	Dec 31, 2016	0	0	11,172	0	0	11,172
Patrick Martin Director	Dec 31, 2016	0	0	0	0	0	0
Sachin Pawa Director	Dec 31, 2016	0	0	0	0	0	0
Nicolaos Mellios Director	Dec 31, 2016	0	0	0	0	0	0
Directors as a Group	Dec 31, 2016	0	0	14,151	0	0	14,151
Directors as a Group	May 31, 2016	0	0	0	0	0	0

(1)	Please refer Note 6(b) to the financial statements included herein.

During the year ended May 31, 2011, we granted 3,100,000 stock options to our directors or officers. The options are granted at an exercise price of $0.25 per share and expiring on February 3, 2019.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

(For period ended December 31, 2016)

Name	Number of securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable	Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)	Option Expiration Date	Number of Unvested Shares (#)	Market Value of Unvested Shares ($)	Number of Unearned Unvested Shares (#)	Market Value of Unearned Unvested Shares ($)
Richard Shao President (resigned on April 3, 2016)	800,000	0	0	$0.25	Feb 3, 2019	0	0	0	0
Christopher Tsakok Chairman	300,000	0	0	$0.25	Feb 3, 2019	0	0	0	0
Kathy Wang Secretary	300,000	0	0	$0.25	Feb 3, 2019	0	0	0	0
Gerald Runolfson Director	600,000	0	0	$0.25	Feb 3, 2019	0	0	0	0
Robert G. Smiley Director	600,000	0	0	$0.25	Feb 3, 2019	0	0	0	0
Chris L MacPherson, Director	0	0	0	0	0	0	0	0	0
Nicolaos Mellios, Chairman	0	0	0	0	0	0	0	0	0
Patrick Martin, Director	0	0	0	0	0	0	0	0	0
Sachin Pawa, Director	0	0	0	0	0	0	0	0	0
Total	2,600,000	0	0			0	0	0	0

Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. Our board of directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director. No director received and/or accrued any compensation for their services as a director, including committee participation and/or special assignments.

There are no management agreements with our directors or executive officers and we do not anticipate that written agreements will be put in place in the foreseeable future.

We have no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control.

There are no plans or arrangements in which we provide pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the Board of Directors or a committee thereof.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth, as of May 1 ^st 2018, certain information with respect to the beneficial ownership of our common shares by each shareholder known to us to be the beneficial owner of 5% of our common shares, and by each of our officers and directors. Each person has sole voting power with respect to the common shares, except as otherwise indicated. Beneficial ownership consists of a direct interest in the common shares, except as otherwise indicated. As of May 1 ^st 2018 , there were 256,016,038 common shares issued and outstanding.

Title of Class	Name and Address of Beneficial Owner (1)	Amount and Nature of Beneficial Ownership	Percentage of Class(2)
Common stock	Raoul Tsakok	19,500,000 (3) (4)	7.61%
Common stock	Christopher Tsakok	1,910,000 (6)	0.75%
Common stock	Nicolaos Mellios	25,669,598	10.02%
Common Stock	Chris L MacPherson	25,645,000	10.01%
Common Stock	Chris Ruck	4,684,702	1.83%
Common stock	Robert Smiley	600,000 (5)	0.23%
	TOTAL	78,009,300	30.45%

	(1)	The address of each beneficial owner is 520 – 409 Granville St, Vancouver, BC Canada V6C 1T4
	(2)	Based on 256,016,038 shares outstanding as of May 1 ^st , 2018 and, as to a specific person, shares issuable pursuant to the conversion or exercise, as the case may be, of currently exercisable or convertible debentures, share purchase warrants and stock options within 60 days.
	(3)	15,000,000 common shares held through Cobilco Inc., a company 100% owned by Mr. Raoul Tsakok.
	(4)	Includes 800,000 stock options.
	(5)	Includes 600,000 stock options.
	(6)	Includes 300,000 stock options.

Changes in Control

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

There have been no transactions, or proposed transactions, which have materially affected or will materially affect us in which any director, executive officer or beneficial holder of more than 10% of the outstanding common stock, or any of their respective relatives, spouses, associates or affiliates, has had or will have any direct or material indirect interest.

As at the date of this annual report, we do not have any policies in place with respect to whether we will enter into agreements with related parties in the future.

We have determined that Chris Tsakok, Patrick Martin, Sachin Pawa and Robert G. Smiley are independent directors.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Audit Fees

BDO Canada LLP (“BDO”) provided audit services to the Company in connection with its annual report for the fiscal years ended May 31, 2016 and May 31, 2015 and the quarter ending November 2016. The aggregate fees billed by BDO for the May 31, 2016 audit and the fiscal year 2016 quarterly reviews of the Company was $81,120. The aggregate fees billed by BDO for the May 31, 2015 year ended audit and the fiscal year 2015 quarterly reviews of the Company was $67,945.

MNP LLP (“MNP”) provided audit services to the Company in connection with its annual report for the period ended December 31, 2016. The aggregate fees billed by MNP for the period ended audit of the Company was $38,000.

Audit Related Fees

No fees were billed by BDO to the Company for professional services that are reasonably related to the audit or review of the Company's financial statements for the years ended May 31, 2016 and 2015.

No fees were billed by MNP to the Company for professional services that are reasonably related to the audit or review of the Company’s financial statements for the period ended December 31, 2016.

Tax Fees

No fees were billed by BDO to the Company in the years ended May 31, 2016 and 2015 for professional tax services.

No fees were billed by MNP to the Company in the period ended December 31, 2016 for professional tax services.

All Other Fees

No fees were billed by BDO to the Company for other professional services rendered or any other services not disclosed above during the years ended May 31, 2016 and 2015.

No fees were billed by MNP to the Company for other professional services rendered or any other services not disclosed above during the period ended December 31, 2016.

Audit Committee Pre-Approval

The Audit Committee has the sole authority to appoint, terminate and replace our independent auditor and to approve the scope, fees and terms of all audit engagements, as well as all permissible non-audit engagements of our independent auditor. All the services provided by the auditors were approved by our Audit Committee.

All audit work was performed by the auditors' full time employees.

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

The following documents are filed as part of this report :

1. Financial Statements.

Our consolidated financial statements are included in Part II, Item 8 of this report:

		Page
	Report of Independent Registered Public Accounting Firm	21
	Consolidated Balance Sheets	22
	Consolidated Statements of Operations	23
	Consolidated Statements of Changes in Stockholders' Equity	24
	Consolidated Statements of Cash Flows	15
	Notes to the Consolidated Financial Statements	26-38

2.	Financial statement schedules and supplementary information required to be submitted.

	Schedules other than that listed above are omitted because they are not applicable.

3.	Exhibits

A list of the exhibits filed or furnished with this report on Form 10-K (or incorporated by reference to exhibits previously filed or furnished by us) is provided in the Exhibit Index beginning on page 41 of this report. Those exhibits incorporated by reference herein are indicated as such by the information supplied in the parenthetical thereafter. Otherwise, the exhibits are filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

STERLING GROUP VENTURES INC.

By:	/s Nicolaos Mellios
	Nicolaos Mellios
	Chief Executive Officer and President, (Principal Executive Officer)

	Date: May 1 ^st , 2018

Pursuant to the requirements of Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date

/s/ Nicolaos Mellios
Nicolaos Mellios	President and Chief Executive Officer	May 1 ^st , 2018
	(Principal Executive Officer)
/s/ Chris L MacPherson
Chris L MacPherson	Chief Financial Officer	May 1 ^st , 2018

/s/ Chris Tsakok
Chris Tsakok	Director	May 1 ^st , 2018

/s/ Robert Smiley
Robert Smiley	Director	May 1 ^st , 2018

Index of Exhibits

Exhibit
Number		Description

3.1		Articles of Incorporation of the Company, (filed as Exhibit 3.1 to the Company's Registration Statement on Form SB-2 filed on July 26, 2002, and incorporated herein by reference).
3.2		Bylaws of the Company (filed as Exhibit 3.2 to the Company's Registration Statement on Form SB-2 filed on July 26, 2002, and incorporated herein by reference).
4.1		Specimen stock certificate (filed as Exhibit 4.1 to the Company's Registration Statement on Form SB-2 filed on July 26, 2002, and incorporated herein by reference).
10.1		Acquisition Agreement between the Company and Micro Express Ltd., dated January 20, 2004. (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on January 29, 2004, and incorporated herein by reference).
10.2		Joint Venture Contract between Micro Express Ltd. (the Company’s wholly subsidiary) and Sichuan Province Mining Ltd., dated April 5, 2005 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on April 11, 2005, and incorporated herein by reference).
10.3		Agreement for Development of DXC Salt Lake Property between Micro Express Holdings Inc. (the Company’s wholly subsidiary) and Beijing Mianping Salt Lake Research Institute, dated September 16, 2005 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on September 21, 2005, and incorporated herein by reference).
10.4		Agreement for Termination of Joint Venture between Micro Express Ltd. and Sichuan Province Mining Ltd., dated March 3, 2006 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on March 6, 2006, and incorporated herein by reference).
10.5		Agreement between the Company, Zhong Chuan International Mining Holding Co., Ltd., and shareholders of Monte Sea Holdings Ltd., dated July 8, 2008 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on July 15, 2008, and incorporated herein by reference).
10.6		Agreement between the Company, Hongyu Mining Co., Ltd. , and the shareholders of Hongyu Mining Co., Ltd., dated October 18, 2010 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on October 21, 2010, and incorporated herein by reference).
10.7		Letter of Intent between the Company and Shimen County Merchants Bureau, dated November 10, 2010 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on November 16, 2010, and incorporated herein by reference).
10.8		Agreement for Termination of Joint Venture between the Company, Micro Express Holdings Inc. and Beijing Mianping Salt Lake Research Institute, dated October 31, 2011 (Filed as Exhibit 10.1 to the Company's current report on Form 8-K filed on November 3, 2011, and incorporated herein by reference).
14.1		Code of Ethics. (Filed as Exhibit 14.1 to the Company's annual report on Form 10-K filed on August 28, 2009, and incorporated herein by reference).
31.1		Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
31.2		Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
32.1		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Sec. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
32.2		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Sec. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
99.1		Audit Committee Charter. (Filed as Exhibit 99.1 to the Company's annual report on Form 10-K filed on August 28, 2009, and incorporated herein by reference).
101.INS		XBRL Instance Document. Furnished herewith.
101.SCH		XBRL Taxonomy Extension Schema Document. Furnished herewith.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document. Furnished herewith.
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document. Furnished herewith.
101.LAB		XBRL Taxonomy Extension Label Linkbase Document. Furnished herewith.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document. Furnished herewith.

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