UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

x

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2006

o

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to __________

Commission file number 000-501191

UREX ENERGY CORP.
(Exact name of registrant as specified in its charter)

 

Nevada
(State or other jurisdiction of incorporation or organization)

 

98-0201259
(I.R.S. Employer Identification No.)

 

10580 N. McCarran Blvd., Building 115-208
Reno, Nevada 89503
(Address of principal executive offices)

 

775.747.0667

(Issuer's telephone number)

 

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

 

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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  x      No  o

 

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act).

 

Yes  o   

No  x

APPLICABLE ONLY TO CORPORATE ISSUERS

There are 94,425,600 shares of common stock issued and outstanding as of October 31, 2006.

Transitional Small Business Disclosure Format (Check one):  

Yes  o   

No  x

 

 



- 2 -

 

 

PART I - FINANCIAL INFORMATION

Item   1.    Financial Statements.

It is the opinion of management that the interim consolidated financial statements for the quarter ended September 30, 2006 include all adjustments necessary in order to ensure that the interim consolidated financial statements are not misleading.

Our interim consolidated financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

 

 



- 3 -

 

 

 

 

UREX ENERGY CORP

(f/k/a LAKEFIELD VENTURES INC.)

 

(An Exploration Stage Company)

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

 

 

 

 

 



 

- 4 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

September 30, 2006 and March 31, 2006

 

 

September 30,

March 31,

ASSETS

2006

(Unaudited)

2006

(Audited)

 

 

 

Current

 

 

Cash

$              107,871

$              34,572

Prepaid and other current assets

9,573

136

Due from related party

2,366

-

Accounts receivable

-

15,000

 

119,810

49,708

 

 

 

Advance on assignment agreement

-

50,000

 

-

50,000

 

 

 

TOTAL ASSETS

$              119,810

$              99,708

 

 

 

LIABILITIES

 

 

 

Current

 

 

Accounts payable and accrued liabilities

$                75,836

$              50,138

Note payable to related party

22,500

22,500

Note payables

468,082

204,577

 

566,418

277,215

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

STOCKHOLDERS' DEFICIT

 

 

 

Capital stock

 

 

Authorized:

 

 

 

300,000,000

common shares with a par value of $0.001

 

 

10,000,000 preferred shares with a par value of $0.001

 

 

Issued and outstanding:

 

 

94,425,600

common shares (March 31, 2006 – 78,425,600)

94,425

39,213

NIL preferred shares

-

-

Additional paid-in capital

5,547,574

2,787

Deficit accumulated during the exploration stage

(6,087,908)

(219,507)

 

(318)

 

Total stockholders' deficit

(446,248)

(177,507)

 

 

 

Total liabilities and stockholders' deficit

$            119,810

$           99,708

 

 

 



 

- 5 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURE S, INC.)

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS

For the three and six months ended September 30, 2006 and 2005 and

For the period February 6, 2002 (Date of Inception) to September 30, 2006

 

 

 

 

 

 

 

 

Three months ended
September 30,

Six months ended
September 30,

February 6,
2002 (Date of
Inception) to
September 30,

 

 

 

2006

2005

2006

2005

2006

 

 

 

 

 

 

Expenses

 

 

 

 

 

Management fees

$          35,226

$                    

$          65,936

$                   

$       125,226

 

 

 

 

 

 

Professional fees

39,121

 

56,207

 

119,738

Consulting fees

11,631

 

21,631

 

21,631

Exploration costs

33,730

-

34,842

-

89,006

Donated services

-

-

-

-

11,577

Interest on loans

6,062

 

8,802

 

 

Goodwill

-

-

5,662,012

-

5,662,012

General and administrative

17,945

2,518

19,421

7,636

58,718

 

 

 

 

 

 

 

-

-

-

-

-

 

 

 

 

 

 

Net loss for the period

$      (143,715)

$         (2,518)

$   (5,868,851)

$        (7,636)

$  (6,087,908)

 

 

 

 

 

 

Basic and diluted loss per share

$            (0.00)

$           (0.00)

$            (0.00)

$          (0.01)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of

shares outstanding

 

94,425,600

 

 

 

94,425,600

 

 

 

 

 

 

 

 

 

 

 

 

 



 

- 6 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six months ended September 30, 2006 and 2005 and

For the period February 6, 2002 (Date of Inception) to September 30, 2006

 

 

 

 

February 6, 2002

 

Six months ended

September 30,

February 6, 2002
(Date of Inception)
to September 30,

 

 

2006

2005

2006

 

 

 

 

Cash Flows from Operating Activities

 

 

 

Net loss for the period

$        (5,868,851)

$           (7,636)

$         (6,087,908)

Amortization

-

100

2,500

Impairment of goodwill

5,662,012

 

5,662,012

Adjustments to reconcile net loss to cash used in

operating activities:

 

 

 

Accounts receivable

15,000

-

-

Prepaids

(9,437)

-

(9,573)

Accounts payable and accrued liabilities

13,436

37,500

52,624

 

 

 

 

Net cash used in operating activities

(187,840)

29,964

(380,345)

 

 

 

 

Cash Flows from Investing Activities

 

 

 

Option agreement

-

(30,000)

-

 

 

 

 

Net cash used in investing activities

-

(30,000)

-

 

 

 

 

Cash Flows from Financing Activities

 

 

 

Proceeds from line of credit

-

-

-

Shares issued for cash

-

-

-

Payments to related party

(2,366)

 

(2,366)

Notes payable

263,505

-

468,082

Notes payable to related party

-

-

22,500

 

 

 

 

Net cash provided by financing activities

261,139

-

488,216

 

 

 

 

 

 

 

 

Increase (decrease) in cash during the period

73,299

(36)

107,871

 

 

 

 

Cash, beginning of the period

34,572

492

-

 

 

 

 

Cash, end of the period

$               107,871

$                456

$              107,871

 

 

 

 

 

 

 

 



 

- 7 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY)

For the period February 6, 2002 (Date of Inception) to September 30, 2006

 

 

Common Stock

Additional
Paid-in

Capital

Deficit
Accumulated
During the
Exploration
Stage

Total

Number of

Shares

Amount

 

 

 

 

 

 

Balance, February 2, 2002

-

$               -

$                     -

$                    -

$                     -

 

 

 

 

 

 

Shares issued at $0.001

33,420,000

33,420

(31,920)

-

1,500

Shares issued at $0.01

34,534,000

34,534

(19,034)

-

15,500

Net loss for the period

-

-

-

-

-

Balance, March 31, 2002

67,954,000

$      67,954

$       (50,954)

$                   -

$           17,000

 

 

 

 

 

 

Shares issued at $0.05

5,458,600

5,459

6,791

-

12,250

Net loss for the period

-

-

-

(25,559)

(25,559)

Balance, March 31, 2003

73,412,600

$      73,413

$       (44,163) -

$       (25,559)

$             3,691

 

 

 

 

 

 

Shares issued at $0.05

5,681,400

5,681

7,069

-

12,750

Net loss for the period

-

-

-

(3,076)

(3,076)

Balance, March 31, 2004

79,094,000

$      79,094

$         (37,094)

$       (28,635)

$           13,365

 

 

 

 

 

 

Cancellation of stock

(668,400)

(668)

668

-

-

Net loss for the period

-

-

-

(35,689)

(35,689)

Balance, March 31, 2005

78,425,600

$      78,426

$       (36,426)

$       (64,324)

$        (22,324)

 

 

 

 

 

 

Net loss for the period

-

-

-

(155,183)

(155,183)

Balance, March 31, 2006

78,425,600

$      78,426

$       (36,426)

$     (219,507)

$      (177,507)

 

 

 

 

 

 

Shares issued for acquisition

16,000,000

16,000

5,584,000

-

5,600,000

Net loss for the period

-

-

-

(5,868,851)

(5,868,851)

Balance, September 30, 2006

94,425,600

$      94,426

$     5,547,574

$    (6,087,908)

$      (446,358)

 

 

 

 



 

- 8 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

 

Note 1

Interim Reporting

While the information presented in the accompanying interim consolidated financial statements is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. These interim consolidated financial statements follow the same accounting policies and methods of their application as the March 31, 2006 annual financial statements of Urex Energy Corp. f/k/a Lakefield Ventures, Inc. (Company). All adjustments are of a normal recurring nature. It is suggested that these interim financial statements be read in conjunction with the Company’s March 31, 2006 audited financial statements.

Operating results for the six months ended September 30, 2006 are not necessarily indicative of the results that can be expected for the year ended March 31, 2007.

Note 2

Going Concern

These interim 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 twelve months. Realization values may be substantially different from carrying values as shown and these interim 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. At September 30, 2006, the Company had not yet achieved profitable operations, has accumulated losses of $6,087,908 since its inception, and expects to incur further losses in the development of its business. These factors cast 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.

Note 3

Summary of significant accounting policies

Basis of consolidation and presentation

The accompanying interim consolidated financial statements include the results of operations of all subsidiaries over which the Company holds a majority interest The results of operations of these companies are accounted for using the consolidated method of accounting. All material inter-company accounts and transactions have been eliminated.

 

 



 

- 9 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

Foreign Currency Translation

The Company is located and operates outside of the United States of America. It maintains its accounting records in Argentinean Pesos as follows:

At the transaction date, each asset, liability, revenue and expense is recorded into Argentinean Pesos using the exchange rate in effect at that date. At the year end, monetary assets and liabilities are translated into US dollars using the exchange rate in effect at that date. The resulting foreign exchange gains and losses are included in operations.

Note 4

Mineral Properties

On April 15, 2002, the Company entered into an Option Agreement to acquire 90% interest in a total of six mineral claims located in the Levy Township in Quebec, Canada. In order to earn its interests, the Company made a cash payment totaling $2,500 upon consummating the agreement. Under the terms of the agreement, the Company is required to incur exploration expenditures totaling $150,000, of which $15,000 was required to be expended by December 31, 2004 and $135,000 was required to be expended by December 31, 2005. The properties are subject to 1% net smelter return royalty fees. During December 2004, $15,000 was expensed in accordance with the requirements of the option agreement. The Company has abandoned its interest on this option agreement.

In December 2005, the Company acquired 100% interest in the La Jara Mesa Extension uranium property consisting of 137 unpatented mining claims of approximately 2,740 acres through staking, in the Grants Mining District of Cibola County in New Mexico, USA. The Company plans to commence a drilling exploration program as soon as financing is arranged.

Note 5

Merger and acquisition

Urex Energy Corp.

The Company established a wholly owned subsidiary in the State of Nevada named Urex Energy Corp. (“Urex”) on June 8, 2006. Concurrently, the Company and Urex entered into an agreement and plan of merger whereby Urex and Lakefield agreed to be merged with and into Lakefield, with Lakefield remaining as the surviving company under the name "Urex Energy Corp."

The Company’s authorized capital was increased due to the merger from 150,000,000 common shares to 300,000,000 common shares, and included an additional authorized 10,000,000 preferred shares with par value of $0.001 per share.

 

 



 

- 10 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

United Energy Metals, SA

On September 22, 2005, the Company entered into an Assignment Agreement with International Mineral Resources Ltd. (IMR), whereby IMR assigned its right, title and interest in the Option Agreement entered between IMR and United Energy Metals, SA (UEM) to the Company. The Option Agreement allows for the holder of the option to acquire 99.8% of UEM, an Argentina company which in turn holds a 100% interest in a commanding property position of 170,000 hectares adjacent to the Cerro Solo Uranium deposit known as the “Rio Chubut” property. As consideration for the assignment of the Option from IMR to the Company, the Company is required to issue to IMR 8,000,000 common shares of the Company and pay IMR $50,000. Furthermore, IMR will retain a 5% net smelter royalty.

The Company paid IMR $50,000 in January 2006 and, subsequent to its year end, the Company also issued 8,000,000 common shares of the Company to IMR in June 2006. This acquisition was recorded as a purchase of UEM. The value of UEM was determined as the consideration paid plus the fair market value of the shares issued. The purchase price was then allocated against the fair market value of the assets and liabilities assumed, with the balance recorded as goodwill. Because UEM has no proven mineral reserves, the amount allocated toward goodwill was considered 100% impaired and written off at the date of acquisition.

Note 4

Related Party Transactions

On December 10, 2004, the Company issued a note payable in the amount of $25,000 to the former President of the Company for the purpose of funding exploration activities. The note bears no interest and is due and payable on demand. As of September 30, 2006, the balance of the loan is $22,500.

Effective October 1, 2005, the Company began paying a management consulting agreement with Minera Teles Pires Inc., a company controlled by the President and director of the Company. The agreement provides a fixed fee of $10,000 per month of which $5,000 is paid and the other $5,000 deferred until financing is obtained by the Company. During the six months ended September 30, 2006, $60,000 in management fees were due to Minera Teles Pires Inc., of which $30,000 has been paid and $30,000 has been accrued in accordance with the agreement noted above.

 

 



 

- 11 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

 

Note 5

Promissory Notes Payable

The promissory notes payable are unsecured and bear interest at 5% per annum. They are due on demand.

 

 

September 30,

2006

March 31,

2006

 

 

 

November 15, 2005

$         85,349

$         84,317

December 01, 2005

19,343

19,109

January 06, 2006

102,398

101,151

 

 

 

 

$       207,090

$       204,577

 

 

 

The promissory note payable is unsecured and bear interest at 6% per annum. It is due on demand.

 

 

September 30,

March 31,

 

2006

2006

 

 

 

August 31, 2006

$ 150,000

$ 814

 

Note 6

Stock Dividend

The Company effected a forward stock split of 2 common shares for each 1 common share issued and outstanding. The merger and forward stock split became effective as of July 3, 2006. The total issued and outstanding common shares (post-split) is 94,425,600. All references in the accompanying financial statements to the number of common shares and the per share amounts have been restated to reflect the forward stock split.

 

 



 

- 12 -

 

 

UREX ENERGY CORP.

(f/k/a LAKEFIELD VENTURES, INC.)

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2006

Note 7

Subsequent Events

The former President and former Director of the Company entered into an agreement with the Company to return 20 million common shares which he beneficially owns back to treasury for cancellation.

 

 



 

- 13 -

 

 

Item 2. Management's Discussion and Analysis or Plan of Operation.

This quarterly report contains forward-looking statements as that term is defined Section 27A of the United States Securities Act of 1933 and Section 21E of the United States Securities Exchange Act of 1934. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "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", that 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, performance 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 interim consolidated financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles. The following discussion should be read in conjunction with our interim consolidated financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report, particularly in the section entitled "Risk Factors" of this quarterly report.

In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "common shares" refer to the common shares in our capital stock. As used in this quarterly report, the terms "we", "us", "our" and "Urex" mean Urex Energy Corp., unless otherwise indicated.

Corporate History

We were incorporated in Nevada on February 6, 2002 under the name of Lakefield Ventures Inc. Effective June 2, 2006, we increased our authorized common stock from 50,000,000 shares, par value $0.001, to 150,000,000 shares, par value $0.001, and we effected a 11.4 for one (1) forward stock split of our issued and outstanding common stock. Effective July 3, 2006, we changed our name from “Lakefield Ventures Inc.” to “Urex Energy Corp.” as a result of a merger with Urex Energy Corp., our wholly-owned subsidiary that was incorporated solely to effect the name change. In addition, on July 3, 2006, we effected a two (2) for one (1) forward stock split of our authorized, issued and outstanding common stock.

Our principal executive office is located at 10580 N. McCarran Blvd., Building 115-208, Reno, Nevada. The telephone number of our principal executive office is 775.747.0667.

We are also registered as a foreign company in Argentina, and our legal address in Argentina is 1052 San Martin Avenue, 3rd Floor, Office 17, Cuidad Mendoza, Province of Mendoza, Argentina.

We have one majority-owned subsidiary, United Energy Metals S.A., an Argentina company, of which we own 99.8% of the issued and outstanding capital stock.

Since inception, we have been primarily engaged in the acquisition and exploration of uranium mining properties, but have not yet realized any revenues from our planned operations. Currently, we have two uranium prospects, the Rio Chubut Property located in the Chubut Province of Patagonia, Southern Argentina and the La Jara Mesa Property located in Cibola County, New Mexico.

 

 



 

- 14 -

 

 

Plan Of Operations And Cash Requirements

During the next twelve month period, we plan to complete a Phase 1 initial exploration program on the La Jara Mesa Property and the Rio Chubut Property. We anticipate that this program will cost $1.1 million as set forth below:

La Jara Mesa Extension: Proposed Exploration Expenditures ($USD)

 

Salaries & Wages

 

$

40,000

Consulting and Technical Services

 

$

50,000

Surface work

 

$

265,000

Environmental

 

$

10,000

Property Costs

 

$

24,000

Administrative & General

 

$

34,000

Machinery expense

 

$

24,000

TOTAL

 

$

447,000

 

Rio Chubut: Proposed Exploration Expenditures ($USD)

 

Salaries & Wages

 

$

40,000

Consulting and Technical Services

 

$

170,000

Surface work

 

$

360,000

Environmental

 

$

10,000

Property Costs

 

$

15,000

Administrative & General

 

$

34,000

Machinery expense

 

$

24,000

TOTAL

 

$

663,000

                 In addition, we anticipate incurring the following costs during the next twelve month period: $60,000 on professional fees; $60,000 on salaries and wages; $30,000 on travel costs; $50,000 on promotional expenses; $60,000 on other administrative expenses; and an additional $630,000 in surface work and drilling. As a result, we anticipate that we will incur approximately $2,000,000 in operating expenses during the next twelve month period.

We incurred a loss of $5,868,851 for the six month period ended September 30, 2006 compared to a loss of $7,636 for the six month period ended September 30, 2005. As of September 30, 2006 we had a working capital deficiency of $446,608 compared to a working capital deficiency of $177,507 as of March 31, 2006. As indicated above, our estimated working capital requirements and projected operating expenses for the next twelve month period total $2,000,000. As our current working capital will likely not be sufficient to cover our estimated capital requirements during the next twelve month period, we will be required to raise additional funds through the issuance of equity securities or through debt financing. There can be no assurance that we will be successful in raising the required capital or that actual cash requirements will not exceed our estimates. We intend to fulfil any additional cash requirement through the sale of our equity securities.

Given that we are an exploration stage company and have not generated revenues to date, our cash flow projections are subject to numerous contingencies and risk factors beyond our control, including exploration and development risks, competition from well-funded competitors, and our ability to manage growth. We can offer no assurance that our expenses will not exceed our projections. If our expenses exceed estimates, we will require additional monies during the next twelve months to execute our business plan.

There are no assurances that we will be able to obtain funds required for our continued operation. 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 obtain additional financing on a timely basis, we will not be able to meet our other obligations as they become due and we will be forced to scale down or perhaps even cease the operation of our business.

 

 



 

- 15 -

 

 

There is substantial doubt about our ability to continue as a going concern as the continuation of our business is dependent upon obtaining further long-term financing, successful exploration and development of our property interests and, finally, achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

Exploration and Development Costs

We have applied for a permit to start an exploration program in regards to our La Jara Mesa Property consisting of approximately 3200 metres (10,000 feet) of drilling planned (10 holes) that should start in late November 2006. The drill program is designed to test for the extension of uranium mineralization defined at Laramide Resources’ La Jara Meza Deposit located on the south-western corner of the property. Depending on the results from the initial round of drilling, a second phase drilling program may follow in early 2007.

Our proposed budget is also expected to support a seismic refraction geophysical survey followed by a 5,000 meter (15,000 foot) drill program (40 drill holes) in regards to our Rio Chubut Property, which is designed to test for new uranium ore bodies in the central Chubut Province, Argentina which is adjacent to the Cerro Solo uranium deposit.

Capital Expenditures

As of September 30, 2006, our company did not have any material commitments for capital expenditures and management does not anticipate that our company will spend additional material amounts on capital expenditures during the next twelve month period.

Employees

Currently our only employees are our executive officers. We do not expect any material changes in the number of employees over the next twelve month period. Given the early stage of our development and exploration properties, we intend to continue to outsource our professional and personnel requirements by retaining consultants on an as needed basis.  However, if we are successful in our initial and any subsequent drilling programs, we may retain additional employees.  

RESULTS OF OPERATIONS

As at September 30, 2006, we had a working capital deficiency of $446,608. Our interim consolidated financial statements report a net loss of $5,868,851 for the six month period ended September 30, 2006 as compared to a net loss of $7,636 for the six month period ended September 30, 2005. Our accumulated losses for the period from February 6, 2002, our date of inception, to September 30, 2006 was $6,087,908.

Our total liabilities as of September 30, 2006 were $566,418, as compared to total liabilities of $277,215 as at March 31, 2006.  The change was due to increases in notes payable and increased business activity.

Cash Flow Used in Operating Activities

Operating activities used cash of $187,840 for the six months ended September 30, 2006 compared to generating $29,964 for the six months ended September 30, 2005. The increase in cash used during the six months ended September 30, 2006 was commensurate with our increase in net loss.

Cash Flow Used in Investing Activities

Investing activities used cash of $nil during the six months ended September 30, 2006 compared to $30,000 for the six months ended September 30, 2005. The decrease in cash used during the six months ended September 30, 2006 resulted from a decrease in investing activities.

 

 



 

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Cash Flow Provided by Financing Activities

Financing activities provided cash of $261,139 for the six months ended September 30, 2006 as compared to $nil for the six months ended September 30, 2005. The increase in cash provided from financing activities for the six months ended September 30, 2006 resulted from increases in notes payable.

Trends and Uncertainties

Our ability to generate revenues in the future is dependent on whether we successfully explore and develop our current property interests or any property interests that we may acquire in the future. We cannot predict whether or when this may happen and this causes uncertainty with respect to the growth of our company and our ability to generate revenues.

Off-Balance Sheet Arrangements

Our company has no outstanding derivative financial instruments, off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. Neither our company nor our operating subsidiary engages in trading activities involving non-exchange traded contracts.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures of our company. Although these estimates are based on management's knowledge of current events and actions that our company may undertake in the future, actual results may differ from such estimates.

Going Concern

The audited financial statements included with our annual report on Form 10-KSB filed with the Securities and Exchange Commission on July 14, 2006 have been prepared on the 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. Accordingly, the audited financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary should we be unable to continue as a going concern. Due to the uncertainty of our ability to meet our current operating expenses and the capital expenses noted above, in their report on the annual financial statements for the year ended March 31, 2006, our independent auditors included an explanatory paragraph regarding concerns about our ability 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 our financial statements.

Mining Properties

Mineral property acquisition, exploration and development costs are expensed as incurred until such time as economic reserves are quantified.  From that time forward, we will capitalize all costs to the extent that future cash flows from mineral reserves equal or exceed the costs deferred.  The deferred costs will be amortized over the recoverable reserves when a property reaches commercial production.  Costs related to site restoration programs will be accrued over the life of the project.  To date, we have not established any proven reserves on our mineral properties. As at September 30, 2006, we do not have any proven reserves.

 

 



 

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NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No. 123(R), "Accounting for Stock-Based Compensation".  SFAS 123(R) establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services.  This Statement focuses primarily on accounting for transactions in which an entity obtains employee services in share-based payment transactions.  SFAS 123(R) requires that the fair value of such equity instruments be recognized as expense in the historical financial statements as services are performed.  Prior to SFAS 123(R), only certain pro-forma disclosures of fair value were required.  SFAS 123(R) shall be effective for us as of the beginning of the first interim or annual reporting period that begins after December 15, 2005. The adoption of this new accounting pronouncement does not have an impact on our consolidated financial statements.

In March 2005, the FASB issued Interpretation No. 47, Accounting for Conditional Asset Retirement Obligations, an interpretation of FASB Statement No. 143 (“FIN 47”). FIN 47 requires the recognition of a liability for the fair value of a legally-required conditional asset retirement obligation when incurred, if the liability’s fair value can be reasonably estimated. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective for fiscal years ending after December 15, 2005. The adoption of FIN 47 did not have an impact on our financial statements.

RISK FACTORS

Much of the information included in this quarterly report includes or is based upon estimates, projections or other "forward-looking statements". Such forward-looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions, or other future performance suggested herein. We undertake no obligation to update such forward-looking statements to reflect events or circumstances occurring after the date of such statements.

Such estimates, projections or other "forward-looking statements" involve various risks and uncertainties as outlined below. We caution readers of this quarterly report that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward-looking statements". In evaluating us, our business and any investment in our business, readers should carefully consider the following factors.

We have had negative cash flows from operations and if we are not able to continue to obtain further financing our business operations may fail..

To date we have had negative cash flows from operations and we have been dependent on sales of our equity securities and debt financing to meet our cash requirements and have incurred a net loss of $5,868,851 for the six month period ended September 30, 2006, and cumulative losses of $6,087,908 to September 30, 2006. As of September 30, 2006 we had a working capital deficiency of $446,608. We do not expect to generate positive cash flow from operations in the near future. There is no assurance that actual cash requirements will not exceed our estimates. Any decision to further expand our company’s operations or our exploration properties is anticipated to involve consideration and evaluation of several significant factors including, but not limited to:

 

costs to bring each property into production, including exploration work, preparation of production feasibility studies, and construction of production facilities;

 

availability and costs of financing;

 

ongoing costs of production;

 

 



 

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market prices for the minerals to be produced;

 

environmental compliance regulations and restraints; and

 

political climate and/or governmental regulation and control.

The occurrence of any of the aforementioned events could adversely affect our ability to meet our business plans.

We depend almost exclusively on outside capital to pay for the continued exploration and development of our properties. Such outside capital may include the sale of additional stock and/or commercial borrowing. Capital may not continue to be available if necessary to meet these continuing development costs or, if the capital is available, that it will be on terms acceptable to us. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may be unable to continue our business and, as a result, we may be required to scale back or cease our business operations, the result of which would be that our stockholders would lose some or all of their investment.

A decline in the price of our common stock could affect our ability to raise further working capital and adversely impact our operations .

A prolonged decline in the price of our common stock could result in a reduction in the liquidity of our common stock and a reduction in our ability to raise capital. Because our operations have been primarily financed through the sale of equity securities, a decline in the price of our common stock could be especially detrimental to our liquidity and our continued operations. Any reduction in our ability to raise equity capital in the future would force us to reallocate funds from other planned uses and would have a significant negative effect on our business plans and operations, including our ability to develop new products and continue our current operations. If our stock price declines, we may not be able to raise additional capital or generate funds from operations sufficient to meet our obligations.

We have a history of losses and fluctuating operating results which raises doubt about our ability to continue as a going concern.

From inception through to September 30, 2006, we have incurred aggregate losses of approximately $6,087,908. Our loss from operations for the six month period ended September 30, 2006 was $5,868,851. There is no assurance that we will operate profitably or will generate positive cash flow in the future. In addition, our operating results in the future may be subject to significant fluctuations due to many factors not within our control, such as general economic conditions, market price of minerals and exploration and development costs. If we cannot generate positive cash flows in the future, or raise sufficient financing to continue our operations, then we may be forced to scale down or even close our operations. Until such time as we generate revenues, we expect an increase in development costs and operating costs. Consequently, we expect to incur operating losses and negative cash flow until our properties enter commercial production.

We have a limited operating history and if we are not successful in continuing to grow our business, then we may have to scale back or even cease our ongoing business operations.

We have no history of revenues from operations and have no significant tangible assets. We have yet to generate positive earnings and there can be no assurance that we will ever operate profitably. Our company has a limited operating history and must be considered in the development stage. The success of our company is significantly dependent on a successful acquisition, drilling, completion and production program. Our company’s operations will be subject to all the risks inherent in the establishment of a developing enterprise and the uncertainties arising from the absence of a significant operating history. We may be unable to locate recoverable reserves or operate on a profitable basis. We are in the development stage and potential investors should be aware of

 

 



 

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the difficulties normally encountered by enterprises in the development stage. If our business plan is not successful, and we are not able to operate profitably, investors may lose some or all of their investment in our company.

Trading in our common shares on the OTC Bulletin Board is limited and sporadic making it difficult for our shareholders to sell their shares or liquidate their investments.

Our common shares are currently quoted on the OTC Bulletin Board. The trading price of our common shares has been subject to wide fluctuations. Trading prices of our common shares may fluctuate in response to a number of factors, many of which will be beyond our control. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with no current business operation. There can be no assurance that trading prices and price earnings ratios previously experienced by our common shares will be matched or maintained. These broad market and industry factors may adversely affect the market price of our common shares, regardless of our operating performance.

In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs for us and a diversion of management's attention and resources.

Because of the early stage of development and the nature of our business, our securities are considered highly speculative.

Resource exploration and development is a speculative business, characterized by a number of significant risks including, among other things, unprofitable efforts resulting not only from the failure to discover mineral deposits but from finding mineral deposits which, though present, are insufficient in quantity and quality to return a profit from production. The marketability of minerals acquired or discovered by our company may be affected by numerous factors which are beyond the control of our company and which cannot be accurately predicted, such as market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment and such other factors as government regulation, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection, the combination of which factors may result in our company not receiving an adequate return of investment capital.

As our properties are in the exploration and development stage, there can be no assurance that we will establish commercial discoveries on our properties.

The mining and exploration business relies upon the accuracy of determinations as to whether a given deposit has significant mineral reserves and resources. This reliance is important in that reported mineral reserves and resources are only estimates and do not represent with certainty that estimated mineral reserves and resources will be recovered or that they will be recovered at the rates estimated. Mineral reserve and resource estimates are based on limited sampling, and inherently carry the uncertainty that samples may not be representative. Mineral reserve and resource estimates may require revision (either upward or downward) based on actual production experience. Market fluctuations in the price of metals, as well as increased production costs or reduced recovery rates, may render certain mineral resources uneconomic. Inaccurate estimates may result in a misallocation of resources such that an excess amount could be allocated to a less than economic deposit or, conversely, failure to develop a significant deposit.

Our company will be subject to operating hazards and risks which may adversely affect our company’s financial condition.

Mineral exploration involves many risks, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. Our operations will be subject to all the hazards and risks normally incidental to exploration, development and production of metals, such as unusual or unexpected formations, cave-ins or pollution, all of which could result in work stoppages, damage to property and possible environmental damage. We do not have general liability insurance covering our operations and do not presently intend to obtain liability

 

 



 

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insurance as to such hazards and liabilities. Payment of any liabilities as a result could have a materially adverse effect upon our company's financial condition.

Our company’s activities will be subject to environmental and other industry regulations which could have an adverse effect on the financial condition of our company.

Our activities are subject to environmental regulations promulgated by government agencies from time to time. Environmental legislation generally provides for restrictions and prohibitions on spills, releases or emissions of various substances produced in association with certain mining industry operations, such as seepage from tailing disposal areas, which may result in environmental pollution. A breach of such legislation may result in imposition of fines and penalties. In addition, certain types of operations require the submission and approval of environmental impact assessments. Environmental legislation is evolving in a manner which means stricter standards and enforcement, and more stringent fines and penalties for non-compliance. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in governmental regulations could have an adverse effect on the financial condition of our company.

Our operations, including exploration and development activities and commencement of production on our properties, which will require permits from various federal, state, provincial and local governmental authorities, are and will be governed by laws and regulations governing prospecting, development, mining, production, exports, taxes, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in the development and operation of mines and related facilities generally experience increased costs and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits.

Failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities. Such actions may cause operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations and, in particular, environmental laws.

Our current property interests are located in North and South America, and the current and future economic, political and social conditions, as well as the governmental policies of the respective jurisdictions, could have an adverse effect on our company’s overall financial condition and ability to general revenues.

We expect that a substantial portion of our business, including future assets and operations of our company, will be located and conducted in North and South America, including Argentina and New Mexico. The economy of such countries differs from the economies of most developed countries in many respects. While the economies of such countries, including Argentina and Mexico, have experienced significant growth in the past twenty years, growth has been uneven, both geographically and among various sectors of the economy. The governments of such countries have implemented various measures to encourage economic growth and guide the allocation of resources. While some of these measures benefit the overall economy of such countries, they may have a negative effect on our operations. For example, our operating results and financial condition may be adversely affected by government control over capital investments or changes in tax regulations applicable to us. If there are any changes in any policies by such governments and our proposed business is negatively affected as a result, then our financial results, including our ability to generate revenues and profits, will also be negatively affected.

Competition may have an adverse impact on our company’s ability to acquire suitable mineral properties, which may have an adverse impact on our company’s operations.

Significant and increasing competition exists for the limited number of mineral acquisition opportunities available. As a result of this competition, some of which is with large established mining companies with substantial capabilities and greater financial and technical resources than our company, we may be unable to acquire attractive mineral properties on terms we consider acceptable. Accordingly, there can be no assurance that any proposed exploration and development program will yield any reserves or result in any commercial mining operation.

 

 



 

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We currently rely on certain key individuals and the loss of one of these certain key individuals could have an adverse effect on our company.

Our company’s success depends to a certain degree upon certain key members of our management. These individuals are a significant factor in our company's growth and success. We do not have key man insurance in place in respect of any of our senior officers or personnel and we do not anticipate obtaining such insurance in the near future. The loss of the service of members of our management and certain key employees could have a material adverse effect on our company. In particular, the success of our company is highly dependant upon the efforts of our president and director, Mr. Richard Bachman, the loss of whose services would have a material adverse effect on the success and development of our company.  

We are an exploration stage company, and there is no assurance that a commercially viable deposit or reserve exists on any of our properties that we have, or might obtain, an interest.

We are an exploration stage company and cannot give assurance that a commercially viable deposit, or reserve, exists on any properties for which our company currently has or may have an interest. Therefore, determination of the existence of a reserve depends on appropriate and sufficient exploration work and the evaluation of legal, economic, and environmental factors. If we fail to find a commercially viable deposit on any of our properties, our financial condition and results of operations will be adversely affected in a material manner.

Investors' interests in our company will be diluted and investors may suffer dilution in their net book value per share if we issue additional shares or raise funds through the sale of equity securities.

Our constating documents authorize the issuance of 310,000,000 shares, consisting of 300,000,000 shares of common stock, par value $0.001 per share and 10,000,000 shares of preferred stock, par value $0.001. In the event that we are required to issue any additional shares or enter into private placements to raise financing through the sale of equity securities, investors' interests in our company will be diluted and investors may suffer dilution in their net book value per share depending on the price at which such securities are sold. If we issue any such additional shares, such issuances will cause a reduction in the proportionate ownership and voting power of all other shareholders. Further, any such issuance may result in a change in our control.

Trading of our stock may be restricted by the Securities and Exchange Commissions’ "Penny Stock" regulations which may limit a stockholder's ability to buy and sell our stock.

The United States Securities and Exchange Commission has adopted regulations which generally define "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors." The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the Securities and Exchange Commission which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of, our common stock.

 

 



 

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NASD sales practice requirements may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described above, the NASD has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, the NASD believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The NASD requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Item 3. Controls and Procedures.

As required by Rule 13a-15 under the Exchange Act, as of the end of the period covered by this report, being September 30, 2006, we have carried out an evaluation of the effectiveness of the design and operation of our company's disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our company's management, including our company's President. Based upon that evaluation, our company's President concluded that our company's disclosure controls and procedures are effective as of the end of the period covered by this report. There have been no changes in our internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our company's reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our company's reports filed under the Exchange Act is accumulated and communicated to management, including our company's President, to allow timely decisions regarding required disclosure.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material, active or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

None.

 

 



 

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Item 6. Exhibits and Reports of Form 8-K.

Exhibit
Number


Description

3.1

Articles and Bylaws incorporated by reference from our Registration Statement on Form 10-SB filed on February 27, 2003

3.2*

Certificate of Amendment to the Articles of Incorporation dated June 2, 2005

3.3*

Certificate of Change dated June 2, 2005

3.4

Certificate of Amendment to the Articles of Incorporation incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

3.5

Certificate of Change incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

3.6

Articles of Incorporation of Urex Energy Corp. incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

3.7

Articles of Merger incorporated by reference from our Current Report on Form 8-K filed on July 5, 2006

3.8

Certificate of Change incorporated by reference from our Current Report on Form 8-K filed on July 5, 2006

3.9

Certificate of Correction with respect to the Certificate of Change incorporated by reference from our Current Report on Form 8-K filed on July 5, 2006

3.10

Certificate of Correction with respect to the Articles of Merger incorporated by reference from our Current Report on Form 8-K filed on July 5, 2006

10.1

Consulting Agreement between our company and Minera Teles Pires Inc., dated September 27, 2005 incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

10.2

Assignment Agreement between our company and International Mineral Resources Inc., dated September 22, 2005 incorporated by reference from our Current Report on Form 8-K filed on September 29, 2005

10.3

Option Agreement between International Mineral Resources Inc. and United Energy Metals S.A., dated September 21, 2005 incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

10.4

Agreement and Plan of Merger between Urex Energy Corp. and Lakefield Ventures Inc., dated June 8, 2006 incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

31*

Section 302 Certification of Richard Bachman, dated November 17, 2006

32*

Section 906 Certification of Richard Bachman, dated November 17, 2006

 

 

 



 

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99.2

Independent Review of the Rio Chubut Uranium Project prepared by Brian Cole, P.Geo., dated September 23, 2005 incorporated by reference from our annual report on Form 10-KSB filed on July 14, 2006

* Filed herewith.

 

 

 



 

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

UREX ENERGY CORP.

By: /s/ Richard Bachman

Richard Bachman

President and Director

Dated: November 17, 2006

 

 

 

 

 

 

DEAN HELLER
Secretary of State
204 North Carson Street, Suite 1
Carson City, Nevada 89701-4299
(775) 684-5708
Website: secretaryofstate.biz

Entity#
C3046-2002

 

Document Number:

20050206382-98

 

Date Filed:

6/2/2005 10:15:23 AM

IN THE OFFICE OF
/s/ Dean Heller
DEAN HELLER SECRETARY OF STATE

 

Certificate of Amendment
(PURSUANT TO NRS 78.385 and 78.390)

 

 

Important: Read attached instructions before completing form.

ABOVE SPACE IS FOR OFFICE USE ONLY

Certificate of Amendment to Articles of Incorporation

For Nevada Profit Corporations

(Pursuant to NRS 78.385 and 78.390 - After Issuance of Stock)

1.

Name of corporation:

Lakefield Ventures Inc.

2.

The articles have been amended as follows (provide article numbers, if available):

 

 

 

The corporation has determined to increase the authorized capital of common stock in Article Four from 50,000,000 shares of common stock to 150,000,000 shares of common stock and also to effect a forward stock split of the issued and outstanding shares of common stock on a basis of 11.14:1 (11:14 new shares for each one(1) old share)

(please see certificate attached.

3.             The vote by which the stockholders holding shares in the corporation entitling them to exercise at least a majority of the voting power, or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may be required by the provisions of the articles of incorporation have voted in favor of the amendment is: 2,750,000 (77.5%). *

4.

Effective date of filing (optional):                           June 2, 2006                         

 

5.

Officer Signature (required): /s/ Michael Iverson                                          

*If any proposed amendment would alter or change any preference or any relative or other right given to any class or series of outstanding shares, then the amendment must be approved by the vote, in addition to the affirmative vote otherwise required, of the holders of shares representing a majority of the voting power of each class or series affected by the amendment regardless of limitations or restrictions on the voting power thereof.

IMPORTANT: Failure to include any of the above information and remit the proper fees may cause this filing to be rejected.

SUBMIT IN DUPLICATE

 

 



 

 

This form must be accompanied by appropriate fees. See attached fee schedule.

 



 

 

CERTIFICATE OF AMENDMENT TO THE

ARTICLES OF INCORPORATION OF

LAKEFIELD VENTURES INC.

“I, the undersigned Michael Iverson, Director of Lakefield Ventures Inc. (the “Corporation”), do hereby certify that the Board of Directors of said Corporation by way of written consent resolution, dated April 26, 2005, adopted a resolution to amend the original articles as follows:

FIRST: The name of the corporation is Lakefield Ventures Inc.

SECOND: The Articles of Incorporation, as currently in effect and as heretofore amended and restated, are hereby amended as follows:

“ARTICLE FOUR . (Capital Stock) The corporation shall have authority to issued an aggregate of ONE HUNDRED AND SIXTY MILLION (160,000,000) shares of stock, par value ONE MILL ($0.001) per share divided into two (2) classes of stock as follows for a total capitalization of ONE HUNDRED AND SIXTY THOUSAND DOLLARS ($160,000).

(A)          NON-ASSESSABLE COMMON STOCK: ONE HUNDRED AND FIFTY MILLION (150,000,000) shares of Common Stock, Par Value ONE MILL ($0.001) per share, and

(B)          PREFERRED STOCK: TEN MILLION (10,000,000) shares of Preferred Stock, Par Value ONE MILL ($0.001) per share.

All capital stock when issue shall be fully paid and non-assessable. No holder of shares of capital stock of the corporation shall be entitled as such to any pre-emptive or preferential rights to subscribe to any unissued stock, or any other securities, which the corporation may now or hereafter be authorized to issue.

The corporation’s capital stock may be issued and sold from time to time for such consideration as may be fixed by the Board of Directors, provided that the consideration so fixed is not less than par value.

Holders of the corporation’s Common Stock shall not possess cumulative voting rights at any shareholders meetings called for the purpose of electing a Board of Directors or on other matters brought before stockholders meetings, whether they be annual or special.”

THIRD: The purpose of the amendment to Article Four is to increase the authorized capital of the Company from 50,000,000 shares of common stock to 150,000,000 shares of common stock with a par value of $0.001/share and to give effect to a 1:11.14 forward stock split of the Company’s Common Stock (the “Forward Stock Split”).

FOURTH: The number of shares of the Company issued and outstanding and entitled to vote on amendments to the Articles of Incorporation is Three Million Five Hundred Fifty Thousand (3,550,000) common $0.001 par value stock, that the said changes and amendments have been consented to and approved by a vote of the stockholders holding at least a majority of each class of stock outstanding and entitled to vote thereon.

IN WITNESS WHEREOF, Lakefield Ventures Inc. has caused these presents to be signed in its name and on its behalf by Michael Iverson, its President on this ___ day of May, 2005, and its President acknowledges that this Certificate of Amendment is the act and deed of Lakefield Ventures Inc., and, under the penalties of perjury, that the matters and facts set forth herein with respect to authorization and approval are true in all material respects to the best of his knowledge, information and behalf.

LAKEFIELD VENTURES INC.

By: /s/ Michael Iverson

 

Michael Iverson, President

 

 

 

 

 

 

 

DEAN HELLER
Secretary of State
204 North Carson Street, Suite 1
Carson City, Nevada 88701-4299
(775) 684 5706
Website: secretaryofstate.biz

Entity #
C3046-2002
Document Number:
20050206383-09
Date Filed:
6/2/2005 10:15:23 AM

IN THE OFFICE OF
DEAN HELLER, SECRETARY OF STATE

 

Certificate of Change Pursuant
to NRS 78.209

Certificate of Change filed Pursuant to NRS 78.209

For Nevada Profit Corporations

1. Name of corporation:

Lakefield Ventures Inc.

2. The board of directors have adopted a resolution pursuant to NRS 78.207 and have obtained any required approval of the stockholders.

3. The current number of authorized shares and the par value, if any, of each class or series, if any, of shares before the change:

50,000,000 shares of common stock par value $0.001 and 10,000,000 preferred shares par value $0.001

4. The number of authorized shares and the par value, if any, of each class or series, if any, of shares after the change:

150,000,000 shares of common stock par value $0.001 and 10,000,000 shares of preferred stock par value $0.001.

5. The number of shares of each affected class or series, if any, to be issued after the change in exchange for each issued share of the same class or series:

39,547,000

6. The provisions, if any, for the issuance of fractional shares, or for the payment of money or the issuance of scrip to stockholders otherwise entitled to a fraction of a share and the percentage of outstanding shares affected thereby:

Fractions of 0.5 or greater will be rounded up and fractions les than 0.5 will be rounded down so no fractional shares are issued

7. Effective date of filing (optional): 6/2/05

8. Officer Signature:

/s/ Michael Iverson
Signature


Title

IMPORTANT: Failure to include any of the above information and submit the proper fees may cause this filing to be rejected.

 

 



 

- 2 -

 

 

CERTIFICATE OF AMENDMENT TO THE

ARTICLES OF INCORPORATION OF

LAKEFIELD VENTURES INC.

“I, the undersigned Michael Iverson, Director of Lakefield Ventures Inc. (the “Corporation”), do hereby certify that the Board of Directors of said Corporation by way of written consent resolution, dated April 26, 2005, adopted a resolution to amend the original articles as follows:

FIRST: The name of the corporation is Lakefield Ventures Inc.

SECOND: The Articles of Incorporation, as currently in effect and as heretofore amended and restated, are hereby amended as follows:

“ARTICLE FOUR . (Capital Stock) The corporation shall have authority to issued an aggregate of ONE HUNDRED AND SIXTY MILLION (160,000,000) shares of stock, par value ONE MILL ($0.001) per share divided into two (2) classes of stock as follows for a total capitalization of ONE HUNDRED AND SIXTY THOUSAND DOLLARS ($160,000).

(A)          NON-ASSESSABLE COMMON STOCK: ONE HUNDRED AND FIFTY MILLION (150,000,000) shares of Common Stock, Par Value ONE MILL ($0.001) per share, and

(B)          PREFERRED STOCK: TEN MILLION (10,000,000) shares of Preferred Stock, Par Value ONE MILL ($0.001) per share.

All capital stock when issue shall be fully paid and non-assessable. No holder of shares of capital stock of the corporation shall be entitled as such to any pre-emptive or preferential rights to subscribe to any unissued stock, or any other securities, which the corporation may now or hereafter be authorized to issue.

The corporation’s capital stock may be issued and sold from time to time for such consideration as may be fixed by the Board of Directors, provided that the consideration so fixed is not less than par value.

Holders of the corporation’s Common Stock shall not possess cumulative voting rights at any shareholders meetings called for the purpose of electing a Board of Directors or on other matters brought before stockholders meetings, whether they be annual or special.”

THIRD: The purpose of the amendment to Article Four is to increase the authorized capital of the Company from 50,000,000 shares of common stock to 150,000,000 shares of common stock with a par value of $0.001/share and to give effect to a 1:11.14 forward stock split of the Company’s Common Stock (the “Forward Stock Split”).

FOURTH: The number of shares of the Company issued and outstanding and entitled to vote on amendments to the Articles of Incorporation is Three Million Five Hundred Fifty Thousand (3,550,000) common $0.001 par value stock, that the said changes and amendments have been consented to and approved by a vote of the stockholders holding at least a majority of each class of stock outstanding and entitled to vote thereon.

IN WITNESS WHEREOF, Lakefield Ventures Inc. has caused these presents to be signed in its name and on its behalf by Michael Iverson, its President on this ___ day of May, 2005, and its President acknowledges that this Certificate of Amendment is the act and deed of Lakefield Ventures Inc., and, under the penalties of perjury, that the matters and facts set forth herein with respect to authorization and approval are true in all material respects to the best of his knowledge, information and behalf.

LAKEFIELD VENTURES INC.

By: /s/ Michael Iverson

 

Michael Iverson, President

 

 

 

 

CERTIFICATION

 

I, Richard Bachman, certify that:

1.            I have reviewed the quarterly report on Form 10-QSB of Urex Energy Corp.;

2.            Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.            Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this quarterly report;

4.             I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and I have:

a)             designed such disclosure controls and procedures to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b)            evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and

c)             disclosed in this quarterly report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting.

5.             I have disclosed, based on my most recent evaluation of internal controls over financial reporting, to the small business issuer’s auditors and the audit committee of the small business issuer’s board of directors (or persons performing the equivalent functions):

a)             all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

b)            any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

 

Date: November 17, 2006

 

/s/ Richard Bachman

Richard Bachman, President

(Principal Executive Officer, Principal Financial Officer

and Principal Accounting Officer)

 

 

 

 

 

Exhibit 32

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

The undersigned, Richard Bachman, President of Urex Energy Corp., hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)           the Quarterly Report on Form 10-QSB of Urex Energy Corp. for the quarterly period ended September 30, 2006 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)           the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Urex Energy Corp.

 

Dated: November 16, 2006

 

 

/s/ Richard Bachman

Richard Bachman

President

(Principal Executive Officer, Principal Financial Officer

and Principal Accounting Officer)

 

 

 

 

 

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Urex Energy Corp. and will be retained by Urex Energy Corp. and furnished to the Securities and Exchange Commission or its staff upon request.