General Metals Update: Comment On 10K Filing, Annual and Special Meeting and Subsequent Financing Activities Enabling Phase1 Drilling To Begin
General Metals Corporation (OTCBB: GNLM) (FWB: GMQ). The Company filed its 10-KSB for 2007 ahead of schedule to enable the Annual and Special Meeting to be held at the Company’s Reno offices @ 1:00 P.M. on Friday, June 29, 2007. This date becomes the record date for the proposed 11:10 forward split once the anticipated shareholder approval is received at the meeting. The effective date for the split will typically be a few days after the vote and will be determined by the NASD. A new trading symbol and cusip number will be assigned and your broker or transfer agent, as the case may be, will handle the change in securities. The Company is paying the costs associated with the transaction. Proxy cards have been mailed to all shareholders of record on May 22, 2007, the meeting record date.
As of the Company’s year end of April 30, 2007 we had $193,796 in cash and $11,200 in prepaid expenses for total current assets of $204,996, compared to last years $114,212. Our fixed assets grew $61,065 in 2006 to $83, 686 in 2007 by the acquisition of vehicles. Total Assets for 2007 were $288,682 compared with $175,277 in 2006. Accounts Payable increased from $32,043 in 2006 to $67,864 in 2007 but the increase was due to the $63,184 loan that the Company’s President and CEO advanced to the Company when financing was not available. Trade payables were only $4,680.
Exploration activities used $128,004 this year compared with $70,488 last year. The Company remains debt free and intends to maintain this condition.
Subsequent Events: Since April 30, 2007, the Company has been active in private placement and existing warrant exercise financing and has issued an additional 4,167,865 restricted common shares and 793,000 additional warrants with exercise prices ranging from $0.125 to $0.25 per share. Proceeds received were in excess of $400,000 cash and other assets. $35,000 of the above mentioned debt was also converted to restricted common shares by the Company’s President and CEO, which leaves $28,184 remaining.
The Company has approximately $600,000 for general corporate purposes and Phase 1 drilling activity on its Independence Mine. The Independence Shallow Target and the North Target will be drilled in six discrete sections, which allows for an open pit ore reserve to be developed a section at a time. The first section to be drilled is on the Independence shallow target and will also be the first section to be mined once permitting is received for the proposed cyanide heap leach operation. The Company has already drilled and sampled approximately 130,000 tons of mineralized material that should generate over $3,000,000 of revenue on recovery. This material is slated as over liner for the heap leach pad, which is the first material to go on the pad.
After a comprehensive review of all of the data in the Company’s possession at its Reno office, a 2007 report by Geologist Paul Lindberg concludes, “All of the known historic mine records and more recent surface drilling indicate that the mineralization found at the Independence Mine is merely the higher level expression of a deeper gold skarn ore target at depth. The Wilson-Independence property contains both shallow and deep economic grade mineral potential…. Once the initial … drill holes have been completed, fill-in drilling would help define an open pit ore reserve.”
Lindberg further states: “There are two known types of ore deposits in the Independence and Fortitude mine areas. Both are believed to have been formed peripherally around the Wilson lobe and the main body of the Copper Canyon stock, a 38 million year old granodiorite intrusive. These lobes may be connected at depth to a larger intrusion. The shallower Independence mine ore deposit contains … elevated silver values relative to gold, indicative of higher level epithermal veins that overlie deeper hypothermal mineralization where gold values are expected to increase … the second ore type is a gold bearing skarn in the more prospective Antler Peak Limestone that lies at depth below the Golconda thrust plate. This type of skarn ore is found at the Fortitude deposit and has also been found to underlie the epithermal veins found at the Independence mine. The greatest gold ore potential on the property lies at depth within the skarn zone.”
Paul Lindberg is a renowned structural geology expert and has consulted on very large projects for Phelps Dodge and other major mining companies over the years. The Company’s President and CEO, Steve Parent comments: “I was introduced to Paul Lindberg while working on a copper exploration project in Arizona in the 1980′s. We worked well together and we have consulted several times since. It became clear as we near the definitive drilling campaigns that Paul’s input would prove invaluable. He has agreed to assist us in making the Independence a world Class project.”
About General Metals: We currently control 100% of The Independence claims which are completely surrounded by Newmont Mining’s Phoenix Mine www.newmont.com and is a 240-acre island with legal access. From 1983 — 1997 there were several exploration campaigns conducted by Noranda, Teck Exploration, Northern Dynasty and Great Basin Minerals which resulted in about 80 reverse circulation and core drill holes being drilled and reported. The 1997 Carrington Report, the 1997 Akright Report, the 2006 Carew Report and the 2005 Frost and Larsen findings are available for review in their entirety at the Company’s office in Reno, Nevada. An Executive Summary is available on the Company’s website www.generalmetalscorporation.com.
The Company has an initial exploration budget for the Independence Mine of $1,350,000 which will be expended for geology, geophysics, phase 1 drilling and early permitting. The Company has received over $600,000 to start the Phase 1 drilling program. Targeted recovery: 235,000 oz. of gold and 2.5 million oz. of silver.
Notice Regarding Forward Looking Statements:
This news release contains “forward-looking statements”, as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, that the Company intends to proceed with Phase 1 drilling at its Independence Mine in Nevada later this year, the budget for the Phase 1 drilling program, that an estimated 235,000 ounces of gold and 2,500,000 ounces of silver are contained in the mineralized material in the “Shallow Target,” and is proposed to be mined and loaded onto a cyanide heap leach pad.
Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with mineral exploration. We are not in control of metals prices and these could vary to make development uneconomic. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-KSB for the 2007 fiscal year, our quarterly reports on Form 10-QSB and other periodic reports filed from time-to-time with the Securities and Exchange Commission.