|1.||Organization, Nature of Business, Going Concern and Managements
Panex Resources Inc. (Panex
or the Company) was incorporated in the State of Nevada on May 28, 2004. The Company is considered to be an Exploration
Stage Company. The Companys principal business is the acquisition and exploration of mineral resources.
Going concern and managements
The accompanying financial statements
have been prepared assuming that the Company will continue as a going concern. Since its inception on May 28, 2004, the Company
has not generated revenue and has incurred net losses. The Company incurred a net loss of $583,360 for the nine months ended May
31, 2012, and a deficit accumulated during the exploration stage of $13,126,773 for the period May 28, 2004 (inception) through
May 31, 2012. Accordingly, it has not generated cash flow from operations and has primarily relied upon advances from shareholders
and proceeds from equity financings to fund its operations. These conditions raise substantial doubt about the Companys
ability to continue as a going concern.
The Company has no mineral property interests
as of the date of this report. Certain mineral property interests are presently being considered, however it is too early to determine
whether they may be considered appropriate for acquisition.
As of May 31, 2012, the Company had cash
During the next 12 months, managements
objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector.
Management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition
Panex is seeking a viable business opportunity
through acquisition, merger or other suitable business combination method, with a focus on undervalued mineral properties for eventual
acquisition. Panex intends to concentrate its acquisition efforts on mineral properties or mineral exploration businesses that
management believes to be undervalued or that management believes may realize a substantial benefit from being publicly owned.
Panex will continue to identify and assess undervalued mineral properties when capital raisings are completed. A small number of
mineral properties are presently being reviewed, but it is too early to say whether they may be considered appropriate for acquisition.
The Company is in the process of raising new capital up to a maximum of $2,400,000 whereby Panex is offering up to 30,000,000 shares
of common stock on a self-underwritten basis. At the date of this report a total of $978,989 has been raised under this offering.
A Prospectus on Form 424B4 was filed on February 17, 2012 and June 18, 2012 with the Securities and Exchange Commission.
The financial statements do not include
any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts or classification
of liabilities that may result from the possible inability of the Company to continue as a going concern.