thanks for sharing this information. I'm kind of AR about typos.
it does make sense that they would increase the A/S as an agenda item, when they already have other items to vote on. It's not like they doubled the A/S. It seems a more reasonable increase, but right now, there are still 830 million issued. At the rates of dilution that we have witnessed since Keevil started, this would last SRSR at least the next couple years. This seems a good buying opportunity now, as the market has already priced in the 11% A/S increase, even though none of those shares have yet been issued and may not ever be.
The objectives they are pursuing with the spinouts and resource estimates, metallurgical studies, and economic assessment are all things that will have a direct positive effect on share price.
HKHE is a financing group that will get to appoint 2 board members, while srsr will appoint three. Then, they will have raised up to $10 million canadian to do prefeasibility and scoping in order to prepare a preliminary economic assessment. The deal provides sufficient capital to do these studies and generate the PEA, which will also contain updated resource estimates.
So, the main point is that the shareholder vote will set this plan in motion. It's a fairly clear business plan and hopefully people here see that. They clearly have a plan, and they have the funds to carry it out through the point of the preliminary economic assessment.
PEA in hand, they will have an idea of the project economics that can then be pitched to instutional investors as they pursue an IPO type listing. They are suggesting this will likely involve a spin out.
Though we don't know who the financing partner is that appoints 2 directors to HKHE, we can be confident that this is a long term partnership. Perhaps, there is an NDA with the HKHE financing partner, not to disclose their identity until the shareholder vote occurs and the option financing is agreed to.
Merle provides confirmation once again that DR is still on board.
SRSR is still in control to the point of having a preliminary economic analysis in hand and the company is funded up to that point, at which time they have the ability to pursue an IPO/uplisting. There will be many opportunities for value recognition events to occur leading up to and including the PEA itself. Share price should be considerably higher as they complete scoping studies, resource estimates, etc and definitely higher by the time the PEA is completed.
Meanwhile, the Shining Tree spinout approval will allow for the next steps to be carried out, which in my view are going to be to follow the recommendations in phases 1 and 2 of the Shining Tree NI report that's filed on SEDAR with the goal of generating a resource estimate. I expect once the spinout occurs, they will do a share issuance to fund that exploration round.
And, what's left of SRSR at that point? Well, it will still have the HKHE shares up to the point of the possible spin out in 2012. The 100 million shares A/S increase will not be used though for Nemegosenda, as this is the purpose of the 5.5-10 million in the option agreement. Instead, I look for SRSR to maybe acquire a new project or try to develop Deadmoose.
I asked Merle about the audited financials for Nio-Star that are supposed to be up on the website, and he responded that they will be up shortly.
AI
