Senior companies normally derive their income from mining or other business ventures (they need not be mining
companies) rather than from the issue of treasury shares.
The following criteria define a junior company:
It is neither a producing company nor the recipient of significant income from production or from some
other business venture.
Exploration funding does not come largely from accumulated cash flow from previous production or from the
investment income from such funds.
The exploration funds are not provided by a senior company that controls more than half the issued shares
of the subsidiary company in question.
The principal way of raising exploration funds is the issue of treasury shares.
The company is not primarily an oil and gas producer, nor is it the exploration arm of a large
It is not a government organization.
The above criteria are essentially identical to those of Kalymon et al (1978, pp. 13-14) and Freyman (1978,
Appendix A, p. 2).
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