I'm speculating. They're clearly broke if they are defaulting on $10k agreements in only 90 days. It's realistic to believe that they have virtual no operations right now.
One thing that doesn't sit well with me and causes me to not trust anybody at this point is the payments they've made to G8MI. My conspiracy theory right now is this:
Don and his pals through Stockpile Reserves and Group8 acquired the mineral rights to the Fencemaker mine. They then sold that off to FLPC for 83M shares of FLPC and $2MM for supposed property payments and exploration costs. The details of Group8's actual cost of acquiring Fencemaker are unknown, because Group8 is a privately held company which Don is the director of. They certainly could not have spent that much money doing proper exploration work, because it wasn't until this year that they actually scanned the entire property. The results of that scan are presumably pretty bad because they are now months late in delivering the results to investors.
They made a payment of $934,266 to G8MI sometime during the quarter ending January 31, 2014. That payment was financed through convertibles, as that is the only source of cash the company has been able to secure up until that time. What we will find out, I'm sure, is what FLPC got for that money is essentially a worthless, old, nearly depleted mine.
So, my theory is that they used FLPC to sell off a worthless asset. They either knew it was worthless when they acquired it, or discovered it later and came up with a way through FLPC to get their money back. They started blasting without doing any proper exploration for one reason, to increase the pps so that they could get convertible financing and pay G8MI. Furthermore, they traded the rest of their worthless rights to Fencemaker for 5M preferred shares of FLPC which gave them the voting rights they needed to increase the A/S and keep things going so they can complete the payment to G8MI. They signed agreements for other properties (Arabia, Rose Creed, etc) without any intention of ever getting to production, but only in an effort to pump the pps so they could get further funding to complete their payment to G8MI.
Either way, if Don and G8MI cared about the value of their 83M shares, they would not had taken $855,608 out of the company when they were essentially in pre-revenue mode. That money right now is the difference between FLPC's current state of affairs and actual production and potential profitability. So, it leads me to believe that their leading priority was the make the $2M cash payment to G8MI and that the rest of this is just smoke and mirrors.
Just think about all that... it's hard for me to see this any other way right now and the red flags are all in the filings.
AI
