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 company.
- 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).
Note: In this article I have integrated the exact content of the original source, to be certain that this information is retained. If you would like to read this article on the website of the original publisher I recommend you to click the source link below.