Franklin Lake Resources Inc. an exploration stage mining company with no ore reserves or mining operations. Our activities to date have been, and our current activities are, limited to searching for material from which we may be able to extract precious minerals and designing a process for profitable extraction. There is no assurance that commercially viable mineral deposits exist on our property, and further exploration will be required before a final evaluation as to the economic and legal feasibility of our plans can be made. Franklin Lake was originally incorporated as Naxos Resources Ltd. ("Naxos") in British Columbia under the Canada Business Corporations Act on May 23, 1986, with its principal place of business in Vancouver. In the year 2000, we moved our executive and administrative offices to South San Francisco, California, effectively ending our business connections in Canada. On October 29, 2001, Articles of Incorporation and Articles of Domestication were filed with the Secretary of State of Nevada and Naxos was "continued" as a Nevada corporation under the name Franklin Lake Resources Inc. On January 9, 2002, the name change (to Franklin Lake Resources Inc.) became effective for trading purposes. At the same time, a reverse split of the Company's shares on the basis of one new share for each ten shares held also became effective and the Company received a new trading symbol, FKLR.
Exploration Stage Company
We are a company in the "exploration stage", as the term is defined in the SEC's Industry Guide No. 7 (Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations). Industry Guide 7 defines exploration stage companies to include "all issuers engaged in the search for mineral deposits (reserves) which are not in either the development stage or the production stage. Development stage companies are those engaged in preparing for extraction of mineral reserves that have been proved to be commercially mineable. Production stage companies are those engaged in the actual exploitation of commercial reserves. As of the date of this report, we have not established that minerals exist on our property of a type and in a quantity and concentration that would warrant commercial mining. There can be no assurance that commercially viable mineral deposits will be found to exist on our properties, or that we will be able to design a commercially viable process to extract the precious metals.
As an exploration stage company, we are not in a position to fund our cash requirements through our current operations. Recently, we have been able to raise a limited amount of capital through private placements of our equity stock, but we are uncertain about our continued ability to raise funds privately. Further, we believe that in general, junior resource companies such as Franklin Lake have a difficult time raising capital. If we are unable to secure adequate capital to continue our exploration efforts, shareholders may lose some or all of the value of their common stock.
Finances
During our fiscal year ended October 31, 2006, we issued a total of 2,930,770 shares of our common stock. Of the total shares issued, 2,060,770 were issued for cash (including 230,770 issued upon exercise of an option); 870,000 shares were issued for services and rent. Each share (except the shares issued upon exercise of the option) was accompanied by a warrant to purchase one additional share.
Staffing
As of December 31, 2006, besides its four executive officers (only one of which works full time), the Company employed one part-time employee, who works at our Amargosa facility. We believe our relationship with our employees is good.
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Regulation And Licensing
As a publicly held corporation, we are required to file reports with the SEC in addition to other federal and state agencies. Principal among these are the Annual Reports on Form 10-KSB, Quarterly Reports on Form 10-QSB, and Current Reports on Form 8-K; all such reports were filed as required for the
period covered by this report.
Our exploration activities are subject to various laws and regulations governing prospecting, labor standards, occupational safety and health, waste disposal, protection and reclamation of the environ- ment, protection of endangered and protected species, toxic substances and other matters. In the future, we may be subject to clean up liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and other federal and state rules that establish cleanup liability for the release of hazard- ous substances. Further, amendments to current laws and regulations governing operations and activities of companies involved in mineral exploration are actively considered from time to time and could have a material adverse impact on us.
We do not believe we qualify as a solid waste generator under the Resource Conservation and Recovery Act ("RCRA" -- formerly the Hazardous Waste Disposal Act), due to the small quantities of corrosive materials we handle.
Exploration Stage Company
We are a company in the "exploration stage", as the term is defined in the SEC's Industry Guide No. 7 (Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations). Industry Guide 7 defines exploration stage companies to include "all issuers engaged in the search for mineral deposits (reserves) which are not in either the development stage or the production stage. Development stage companies are those engaged in preparing for extraction of mineral reserves that have been proved to be commercially mineable. Production stage companies are those engaged in the actual exploitation of commercial reserves. As of the date of this report, we have not established that minerals exist on our property of a type and in a quantity and concentration that would warrant commercial mining. There can be no assurance that commercially viable mineral deposits will be found to exist on our properties, or that we will be able to design a commercially viable process to extract the precious metals.
As an exploration stage company, we are not in a position to fund our cash requirements through our current operations. Recently, we have been able to raise a limited amount of capital through private placements of our equity stock, but we are uncertain about our continued ability to raise funds privately. Further, we believe that in general, junior resource companies such as Franklin Lake have a difficult time raising capital. If we are unable to secure adequate capital to continue our exploration efforts, shareholders may lose some or all of the value of their common stock.
Finances
During our fiscal year ended October 31, 2006, we issued a total of 2,930,770 shares of our common stock. Of the total shares issued, 2,060,770 were issued for cash (including 230,770 issued upon exercise of an option); 870,000 shares were issued for services and rent. Each share (except the shares issued upon exercise of the option) was accompanied by a warrant to purchase one additional share.
Staffing
As of December 31, 2006, besides its four executive officers (only one of which works full time), the Company employed one part-time employee, who works at our Amargosa facility. We believe our relationship with our employees is good.
- 1 -
Regulation And Licensing
As a publicly held corporation, we are required to file reports with the SEC in addition to other federal and state agencies. Principal among these are the Annual Reports on Form 10-KSB, Quarterly Reports on Form 10-QSB, and Current Reports on Form 8-K; all such reports were filed as required for the
period covered by this report.
Our exploration activities are subject to various laws and regulations governing prospecting, labor standards, occupational safety and health, waste disposal, protection and reclamation of the environ- ment, protection of endangered and protected species, toxic substances and other matters. In the future, we may be subject to clean up liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and other federal and state rules that establish cleanup liability for the release of hazard- ous substances. Further, amendments to current laws and regulations governing operations and activities of companies involved in mineral exploration are actively considered from time to time and could have a material adverse impact on us.
We do not believe we qualify as a solid waste generator under the Resource Conservation and Recovery Act ("RCRA" -- formerly the Hazardous Waste Disposal Act), due to the small quantities of corrosive materials we handle.
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