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Thanks for information that company will file response in February.
How long do you believe state will take to accept, and for the August/Sept start date you project, by when would they need state acceptance ?
How much time do they need to get mill operating and work out any start up issues ?
How long do you think it will take to hire experienced mill personnel?
May I assume you believe the $9 million in orders are such that thier clients can deliver material to mill to be processed as early as August ?
What does $9 million in orders mean?
This is such an interesting situation.
just trying to be polite and keep conversations civil.
in any case, guess you have answered my questions as to your opinions- i.e. that even though they are gearing up for production your opinion is that their cash needs are decreasing since last quarter, and second that they have little expenditures related to meeting the conditions attached to permit approval.
In answer to your question, last quarter even using shares to settle some liabilities they still needed to take in a convertible to cover their cash expenses. Since I understand you believe that they are going into production this year, do you believe their cash needs this quarter went down ?
Second, in my opinion meeting the conditions for permit, even if I accept your contention this is only "paperwork" , must involve some cash expenditures to make sure facilities meet those conditions.
Basically it has been 2 months since they reported $5,000 in the bank, no new convertibles announced, so it would seem normal that company needs another convertible fast to keep moving forward.
I am not trying to be negative as I understand the huge challenge company has , which also provides the huge upside if they eventually go into production. However company is not transparent in even the most basic information.
Last 10q shows share issued and for what category. Shares issued absent a registration require normally a 6 month hold.If insiders sell and put back in the company that will show in the financial statements, as would one vendor receiving shares, selling then paying company bills. It might be possible but seems very complicated way to keep the lights on.
The 10q shows pretty clearly that company's net operating cash requirements some $40,000, and that convertible financing provided that.
Many mining companies struggling to survive, though most a bit more transparent than this company.
Thanks for information and I certainly will call tradestation just to see but I doubt they will permit naked short selling of this stock.
As far as market makers selling short this non-DTC eligible stock to settle in 3 days or as you indicate up to 13 days that still seems a bit unlikely, though selling short the same day to cover by market close probably very frequent. I talked to a friend who is active market maker in low priced stocks and his opinion that it would be uncommon in a stock at this price range and trading volume to be shorted more than a day. To add to your comments selling short works against a broker's net working capital requirement, basically effecting how much the broker can trade per day. Do brokers play games with bid/ask prices to try to influence market, of course they do.Will retail customers sell blocks they have to drop ask price to suddenly pick up more, certainly posible. Do brokers sell a stock into strength figuring they can cover later in the day, very understandable they would do this.
Some brokers for a non-DTC eligible stock will charge extra per trade,and when sold delay when proceeds can be sent until they are sure transaction goes through.The DTC chill generally has nothing to do with permits etc, but related to risk DTC sees and in particular in relation to prior share issues.
One thing I don't know is if the stock is not DTC eligible, are some trades still being settled via DTC,ie. from prior balances ? It would seem so. Anyone know ?
Their own financial statements show they had negative operating cash flow last quarter of some $40,000. Is it your opinion that gearing up to go into production in 6 1/2 months ,and having to meet conditions imposed by the permit, that they would need LESS
cash ? They must have utilities on or ready to go on at the mill, will utility company accept shares ? Can CPA sign off on quarterly review with too much of a past due balance ?
I agree they have shown they are able to be quite creative at paying expenses in various ways-but then again, that means more dilution too. I would expect more dilution so no surprise there.
The reason I ask the questions is to me most important is whether the company is on a path to production whether 2013 or 2014. Company doesnt release data any other company I have seen that is pre-production, in fact hard for an investor to gauge almost any key variable. As far as dilution I had been estimating 100 to 150 million shares but someone posted they are almost at 90 million already, so maybe closer to 200 million this year more likely.
In regards to a new convertible, I dont see what else choice they have at this point.Besides operatinge expenses, they have some big property payments,so it is worrisome if Company doesnt have some cash to negotiate with. It is even more worrisome if they are unable to bring in more convertibles.
I am mystified how meeting the conditions required for the permit would require no manpower ,equipment or construction of any sort either now or prior to production. You have indicated all just paperwork issues and you follow closer and longer than I- but if permit requires certain conditions to be met for tailings for example are you indicating they just have to present a different written plan or operating process with no modfications to actual infrastructure ?
You optimism that the permit wil be granted and then everything all of a sudden falls into place in time for September/October production is quite admirable. The idea that the copper mine will go into production in a year based on cash flow from custom milling from purchase orders for which it is not clear even the basic terms are, well sounds positive- if company would just provide us with some basic information we could all feel comfortable with !
Good questions.
1.) "Expert on CGFI" - I have never claimed this in fact the opposite, ie I have severl time stated I am new to this board and just asking questons to try to get a grasp on the probabilities of company meeting its projected Sept/Oct start date. If company released an update with key assumptions and information all this would have been already answered.
2.) I have no idea how many employees they have at the mill and cant tell from their public information. It seems odd that if there are conditions to be met that these dont include any actions at the mill, and that this wouldnt incur some costs.I assume officers hired any subcontrators, and since company apparently has no cash they have relied on existing relationships to conduct any such work. I can say you dont just flick a switch to turn on a mill that hasnt operated for a numebr of years, and there will most likely be safety and other inspections - so tomeet a Sept/Oct start date they would probably have to turn the mill over at least 1 month if not 2 months earlier to work out the bugs.
3.)How much is this costing ? I have same question,especially since in 10q/10k discussions on liquidity ect company seems to ahve addressed all otehr needs except cost to put mill in operation.
4.)I have no photos.
How can cash on hand be irrelevant to a company gearing up to go into producton in 6 1/2 months ? Sorry I am missing the logic here.
I agree let's look at their financials : yes signficiant portant of expenses are non cash and company apparently has shown creativity in meeting these epxenses.
Last 10q shows actual cash required for operations at $46,802. I think we can agree as company proceeds towards operating a mill etc these expenses wont decline ! Second, another $43,805 spent on asset acquisition.
They financed this by proceeds from a convertible note,$105,000,just like the year before.
It is January 25, financials were as of November 30, no new convertible has been announced. Therefore it does not seem an illogical question to ask how they have financed the company during this period. The bigger question IMO is whether this trend indicates they are on track to a re-start of production.
CFO may be working on some big financing potential thinking as many seem to think moment they get conditions removed off permit financing will be available,and in meantime delaying cash flow impact of expenses.
I admit this is possible, just seems so unlikely they can finance this company quarterly with beginning cash on hand as prior quarters do not indicate this. Second concern is why hasnt CFO brought in another convertible yet to keep things moving forward.
Company selling shares- You have answered my question, i.e. there is no indciation the Company is selling shares itself to the market, nor absent a registration does it seem likely, especially since they have a DCTC chill.
Someone else selling shares to benefit Company- I would have no way of knowing especially as a new person to this board whether Company or CFO have done deals to benefit the company indirectly or directly, though prhaps financials may show this.
Convertible Note Holders Selling - Well we can agree to disagree . Convertible note holders have a built in discount and generally their bigger concern is volume to absorb their sales, small difference like you menton in the I doubt most convertible note hodlers woudl really quibble about.Your point about the price dropping ( absent a strong and credible IR effort) is spot on until they replace the convertible financing- and with a DTC chill and financial challenges they have plus no reserve study it is hard for me to imagine they have a chance at traditional financing - I dont see much choice but for them to finance through convertible financing.
- A curious issue arises with this DTC chill and these convertible notes. If they can convert to free trading shares wont let such shares be settled but DTC wont let such shares settle electronically, how broker settle accounts ? Is there an imbalance between what the brokers show in their accounts vs DTC balances vs transfer agent balances ?
- As far as timing of bid-ask prices, and large share positions effecting the bid price in the manner you bring up, not surprising at all. I would ask though what were next three bids above the $.014 ? But if bid .014, they accepted .0136, was the .016 bidder same MM ?
- And of course I remain curious how you can short a stock like this, no one has ever answered which brokerage firm I can go to and short this stock.
I do appreciate you taking your time to answer my questons,and also whether people agree with you or not, you certainly generate discussion !
$5,000 is very little, for a publicly reporting company- they have transfer agent fees as one example, don't know their office expenses but their must be expenses related to the mill even during the winter.Heck I don't know exactly how they operate , but I do know if they are trying to comply with permit conditions and projecting production in the fall, it is difficult to believe $5,000 is all the expenses for a quarter. Press releases cost money, 8k filings incur a cost. Quarterly 10q alone will cost more than $5,000.
Yes the sources you mention might provide a convertible credit line of some sort, but as a public company they would need to file an 8k on any such arrangement.
Good point, Hemi vs Guyer -Hemi predicting dropping prices andreshare count, vs Guyer pulling a rabbit out of the hat !
Company may issue restricted stock to vendors and employees alike if they accept, but with a DTC chill on the stock and most brokerage firms not accepting certificates in this price range,hard to imagine many outside vendors accepting restricted shares for services.
If I understand situation they have registered some stock under s8 which means that some free trading shares can be issued to employees and consultants etc.
As far as company like this being able to issue shares and sell shares on open market I for one do not know how they would do that, that is why the earlier post about company selling shares on market-if I understand it-caught my eye.
That is why I am curious since no new convertible announced since 10q, and less than $5,000 in the bank how is company meeting basic expenses, how is it preparing for their forecast fall production ? $5,000 wont even cover the next 10q filing.
This is quite an interesting company. How is it funding expenses ? Last 10q showed under $5,000in the bank, and unless I missed no new convertible has been announced. Even if management and consultants paid now with s8 stock, how are other bills getting paid ?
Hi, no I must admit I do not understand how part of the volume today was from the company selling shares in the market if that is what you meant.If it was I am all ears to hear how this works.
Another question- company has convertibles that after 6 months can be converted to free trading shares at a discount.It seems pretty normal price would drop in this scenario,why does it surprise some people ?
I curious, what does "dumped by CGFI" mean? are you saying company somehow selling shares on the market ?
The $120 million value is based on an internal report of the amount metal in the ground based on at best a "resource" as no reserves have been established.
This is before substracting (a)CAPEX (b) costs of recovering metals (c) cost of mining and milling metals. (d) costs of deductons made by smelters prior to payment.
So I am unsure why this figure would be used for any sort of valuation.
However, it does at least show that there is a lot of potential if management can realize it.
Thanks for response, and in response :
Permit - since you have looked into quite a lot it seems, let me accept your assertion that it is only
"paperwork" and that it should be ready by september.Am I the only on ethough that feels it will require some expenditure on those very facilities and changes the state is requesting ? and usually state then wants to inspect ? (especially if it involves water discharge)
DTC chill- I can only go by what people in the industry , brokers and market makers have told me. Is your information from the DTC ?
Resources- I think we have a miscommunication. I am not questioning the amount of material and grades that were reported, I have to assume the President as a professional in the industry wouldn't report those incorrectly, and reporting a grade of .02 gold is hardly an aggressive result ! However as you indicate you know mining stocks you will of course agree that figure is meaningless as a method of valuation unless one knows the category of resource, cost to develop, recovery % of the metal in the ground, how can any judgement be made without key information ? If you add up the value per ton, then compare to the $150 per ton mining costs they quoted in 2009 it still looks like they can make a profit.But $120 million ?
I don't know what recovery would be , but I think pretty clear it wont be the same for each of the metals contained. I also didnt check the copper and lead for whether those grades were economic,so havent done my homework.
I dont disagree with you this could turnout to be an excellent speculation, just it seems - and I mean this well- time for company to get real and realistic. After all, if they only had $5,000 in the bank, that isnt even enough to file their 10q !
Thanks for taking the time to repsond to my prior post.
My two cents as a newbie here : normally I think it is a bad idea for shareholders to try to manage a company, simply they dont have enough information even in companies that are transparent- and from company standpoint my owno pinion is they need to bring in working capital fast to keep moving forward, and have some chips to negotiate with in terms of properties etc.Think of it this way if CFO doesnt know industry , why have people with even less knowledge telling him what to do ? In fact what would people have done differently ?
I do think though shareholders informing company they would like to see the current plan,well explained, and some benchmarks by which management will be judged the next 12 months is not unreasonable.
Better dilution now before they start operations as that will give everyone a chance to average down but seems those who have lost money also have lost faith in company. So why not make it a win-win situation ?
Reality is $5,000 cant even cover one quarter 10q filing, so something needs to be done quickly.
Thanks but actually I dont think most immediate issue start of millng operations but getting cash in the company and at same time help both the pro and anti posters on this site by releasing credible information to make a speculative investment decision on. Company might be very surprised at how positive a move this could be. Since neither CEO nor CFO seem to grasp 21st centure IR in mining sector they could study how other firms report NI43101 reports for example.
But they control a mill, and may have ability to continue controlling properties around it. It is a darn penny stock after all, and who woudlnt be surprized if it went back to sub-penny status ? But if CFO can pull this off, could be great entry point.
Good afternoon, a very productive and interesting discussion. As you know from my posts I am not a basher of the stock, but remain curious.
1.While you may be entirely correct that the permit requires simply plans to address the conditions surely there will be expenditure involved in the various environmental facilities required to be up to speed. Surely company needs some working capital to get ready for production in six months. How can a company with less than $5,000 in the bank be gearing up for custom milling in six months and also address other cash needs in their filings but not those related to production ?
(And by the way, do they need hoisting facilities at their mines)
2. You have quoted over $120 million value, but as I explained taking the amount of material in the ground ( which even the company doesnt provide any detail as to the category of resource)without calculation of processing and extraction costs, recoveries from milling, etc etc,provides a misleading impression. If you look at current metal prices times the totals they quoted,less their own projected mining cost of 3 years ago, how could that possible reach that figure ? That is precise reason normally regulators frown on such assertions.Am I missing something here ? It coudl be a very good copper mine, but company-in my opinion- need sto build credibility.
3. Most junior mining companies have had a terrible time getting funding the last two yars, so no surprise there. Idea of traditional financing sems a stretch for any banker to entertain but who knows. My bigger concern is even to produce in 2014 and develop their own ore to mine, lot should be done this year- it would seem they should be bringing in another convertible now to keep progressing.
I would be pleased to see (a) another convertible financing now (b) a realistic revised time frame (c) rough idea of capex costs and estimates for recoveries etc. (d) announcement of of an outside scoping study etc.(e) terms of their "orders".
They bit the bulet and did a 5000 to 1 reverse, maybe they can step up to the plate and provide shareholders with basic information.
4.The "chill" you speak of at DTC normally doesnt have much to do with permits or merits of a particlar business according to a few brokers and market makers I have spoken too. Where did this information come from ?
I admire your optimism, and notwithstanding my questions it would be great if CFO could pull this off.
This all sounds very positive, and I do hope they progress, but makes several assumptions that are a bit difficult to understand.
A NI43-101 report does not create reserves, this needs a feasibility study according to SME or CIMM standards- and as we have seen on today's press release, they are preparing technical reports using NI43-101 standards, not actual NI43-101 reports.Are you saying this company will have reportable reserves before September ?
It may very well be that permit can be granted when they submit paperwork but the conditions require certain actions to be done such as constructing the necessary facilities - i.e. and undoubtedly these need to be designed, constructed and then inspected.
I admit I do not understand company's difficulty releasing information they have- i.e. if they just did a report internally that showed the economics of the Silver Wing, they have already established a preliminary number. In any case the release today was helpful, i.e. we know now that the Silver Wing is a base metals mine primarily, and secondly a gold/silver mine.
This idea of asset-based financing I do find of great interest , but even with such financing certainly lender will require a cash flow forecast to show company could support loan payments. In any case they brought in $400,000 in financing last year without permit so one could assume they can rely on more convertibles.
Restrictions on shares to consultants etc normally 6 months.
Your sequence of events seems very straightforward. Do you believe they will be processing ore in 6 months ?
Don't get me wrong I am not bashing stock, just doesn't seem too transparent.
This all sounds very positive, and I do hope they progress, but makes several assumptions that are a bit difficult to understand.
A NI43-101 report does not create reserves, this needs a feasibility study according to SME or CIMM standards- and as we have seen on today's press release, they are preparing technical reports using NI43-101 standards, not actual NI43-101 reports.Are you saying this company will have reportable reserves before September ?
It may very well be that permit can be granted when they submit paperwork but the conditions require certain actions to be done such as constructing the necessary facilities - i.e. and undoubtedly these need to be designed, constructed and then inspected.
I admit I do not understand company's difficulty releasing information they have- i.e. if they just did a report internally that showed the economics of the Silver Wing, they have already established a preliminary number. In any case the release today was helpful, i.e. we know now that the Silver Wing is a base metals mine primarily, and secondly a gold/silver mine.
This idea of asset-based financing I do find of great interest , but even with such financing certainly lender will require a cash flow forecast to show company could support loan payments. In any case they brought in $400,000 in financing last year without permit so one could assume they can rely on more convertibles.
Restrictions on shares to consultants etc normally 6 months.
Your sequence of events seems very straightforward. Do you believe they will be processing ore in 6 months ?
Don't get me wrong I am not bashing stock, just doesn't seem too transparent.
Controlling the mill a great asset, and potential to start custom milling while they develop their own ore for production sounds like great plan.
It doesnt bother me that share count will increase, that there will be delays, and maybe a small reverse again as long as they are on the path towards eventual success. What I find difficult to understand idea they can get conditions met with no money,and they resist giving us basic information.
Dilution from convertible debt is not controllable as the convertible note holders can convert at their option after six months of holding the convertible generally. Seems from some posts it is not understood the convertible note holders can convert at any time to free-trading shares.
What other choice does CFO have but to use convertibles to stay alive ? If he could sell shares at less of a discount they would do so.
As far as another reverse many companies go through multiple reverse splits, though someone posted FNRA rules prohibit - maybe prohibition is only so many reverses per year or particular period ?
Could someone advise me what this continual reference to "shorts" is, is this shorthand for someone who wishes to sell, or does some one know of any brokerage firm that will permit clients to shortthis stock. I assume we are all speculators as company certainly doesn't release sufficient information to make an informed long term investment, and their 10k certainly outlines the risks of buying this stock.
Guess we will find out next month or two status of company's progress, or an announcement of a financing.
Would have been nice an outside firm reporting, but frankly how would company pay for ?
In my opinion I fully expect outstanding shares to reach at least 150 to 200 million this year, and another reverse, 1 for 5 or 1 for 10, and if I had to guess company wont start processing ore until 2014 for questions I have outlined previously.
Yet even doing that, could be a great success if CFO can get sufficient funding to keep the lights on and negotiate his way through this difficult year, and start laying groundwork for credible belief by releasing key projections.
While would have been nice a report form a non related party , it is not untypical for a company officer or director to be the qualified person for information released to the public in Canada. Nor after a 5000 to 1 reverse and a year they need to rasie money that a company wouldn't release news to maintain stockholder support. Keep in mind they havent prepared a NI43-101 report, just an internal report using the NI43-101 guidelines, at least that is what seems to be the case.
I keep seeing references to "shorts", does this simply mean people who wish to sell stock, or has someone identified a brokerage firm that one can sell short this stock ? To me it is fairly simple, the convertible note holders whenever they see volume sell at a discount to make their profit, as one would expect. The convertible holds may issue order to sell stock then cover with actual certificate within three days,which could be happening- though with a DTC chill and this stock price they must have a very cooperative broker !
Grade of gold appears to be per press release .02 and silver 1.77. If silver $35, gold $1600, last projected operating costs $150 per ton, and 95% recovery, silver and gold by product costs.
Looking at kitco.com will give current base metal prices, but I think lead $1 a pound and copper $3.66 per pound. If copper estimate some 20 million pounds, it quickly becomes apparent main revenue per ton would come from copper.
If 350 tons per day, question arises how many days would it produce per year and when could mill start. However their 2009 powerpoint stated would be a year before mining could commence, so we are back for this year (a) costs and timing to meet permit conditions (b) what are terms of $9 million orders to have any thought of what 4th quarter could be like. For 2014 surely working capital and CAPEX needed to develop ore to the point where production could commence.
Since company claims study showed it could be potentially economic, there must have been an assumption on operating costs per ton, recovery percentage, etc.No one would hold management accountantable for variations over the next year, but certainly if they are releasing grades and tonnage, and previously released operating cosst per ton, why not update now ?
Seeing copy of report would be nice, but since much information in NI43-101 report usually isnt disclosed in USA, that might be problematic for company.
However in my opinion this company really needs to understand they cant keep not releasing basic information if these wish to build credibility.
After three weeks of doing some initial due diligence I remain of opinion good short term speculation for small amounts of investment, good be a great speculation for larger sums IF management will wake up and release they key basic information that would allow an investor to make a reasonable guess whether they can pull off their busienss plan. My hat is off to CFO for keeping company alive and advancing permitting process the last year. I havent study prior years I admit.
My thanks to everyone for helping me to understand this company better, both positive and negative factors.
New Information on Silver Wing Copper/Lead/Zinc Mine per press release-
Nice to see some news though key information still not disclosed.
Per press release if my math correct:
Grade of gold - .023 ounces per ton
Grade of silver- 1.77 ounces per ton
Using $1600 ounce gold and $35 ounces silver,and their projected 2009 mining costs of $150, even without calculating recovery dilution, it is clear that gold and silver are by-products.
However copper/lead/zinc seem to be where main revenue will come from, and nothing wrong with having a copper/lead/zinc mine !
Glad to see some news, though nothing to indicate whether resource is per canadian standards inferred indicated or measured, or per SEC practice if it is mineralized material ( i.e. indicated and measured per SME standards).
This continual releasing of "metal in the ground" without estimates of recovery losses, capex required, etc is probably just inexperience on part of CFO and CEO of public junior mining sector. Hardly would NI43-101 criteria and practice support this, but as American geologist perhaps just a learning curve for CEO to learn NI43-101 criteria and practice.
.02 grade gold for underground vein mine is very low.
If they say mine is potentially economic, what recovery and CAPX assmptions used ? or is the report availabe anywhere ? Why is management so hesitant to release tehese estimates ? They really need someone who understands junior mining sector to guide them- or spend an afternoon loking at press releases from junior mining companies reporting results per NI43101 standards.
Pretty simple really, just a few estimates per the press release they must already have :
1.tons
2. grade
3. what category of resource
4. tons projected per day
5. recovery losses
6.operating costs per ton
7.capex required
8.costs required to meet permit.
Lot more one could ask for but these are the basics.
However to give credit, nice to see some information released, hopefully a trend for the future.Company controlling a mill advanced in permitting prcoess with potential for custom milling a great asset, just wish they would stop issuing unrealistic metal in the ground estimates which inexperienced investors think for some reasons equates to net value.
Reality is CFO has a big challenge this year and easiest method for him to raise funds is through use of convertibles. However if they do get mill up and operating this year, or even present a credible plan to do so and reach profitability in 2014, probably I would guess he will need a better share structure and share price, thus another reverse is a distinct possibility. Price is already below $.02 with another 20 million plus shares likely to be issued since last 10q to settle existing convertibles let alone new ones.
Hopefully though next reverse is below 1 for 10, and will come soon.
As far as accounting goes, their audited statements show some $5 million went to company during this period from financing activities which includes share issuances. Accounting is accounting and while there may be different ways to treat different transactions, this is pretty straightforward.
As far as the number of share syou indicated were issued, I will accept you have gone back and accounted for all reverse splits etc etc and come up with the number you mention.
As far as using market prices to determine what recipient of shares received,that would seem to be a difficult exercise to be exact about. Who knows ,maybe you are right.
I would assume if they could pull off putting mill into production at a profit they could make more money than they have so that is an incentive. In the meantime if they are making the type of money you are proposing they make, certainly they have incentive to keep things alive.
I would assuem anyone buying this stock knows it is a speculation and trades it accordingly.
Still just for my own education what is a scam and why is this a scam ?
(I admit I hadnt imagined people made $40 million out of this, so that is certainly an eye opener)
Inception to date financing activities show $5 million brought in, how would I reconcile that to $40 million ? Par Value and paid-in capital is over $23 million, but apparently part for shares issued for properties and services.
Well, quite a post to be sure !
The CFO may be experienced in junior mining sector,but otehr than that he seems to have the sort of varied financial experience that could be creative at finding solutions.
All non producing mining companies must dilute there stock to advance, and normally to take an exploration prospect through to commercial production can very well take years. Of course in this case with a mill that is claimed to be operational or very close, and nearby mines that can provide ore, one would expect the process to not take as long as a simple exploration prospect.
Are you saying they have spent company funds unwisely ?
Wow 31 billion shares is a lot.Are you saying they received to capital $40 million the past six years or am I misunderstanding ?
Of course there will be people dumping as holders of convertible notes make their money by converting shares at a discount.This will of course continue until they are paid off. Hopefully company can generate positive news to offset effects of the conversions.
You have used the word scam,and I must respect you have followed the stock longer than I. But if it were not a scam as you say, what would they do differently ? They are probably financing company only way they can, through convertibles. I dont know really what CFO makes, but it seems whatever he makes he has to hustle to receive,and seems he even lent company money.There is a long learning curve in mining business and CFO didnt have mining background. In summary, what makes this a scam ? If they dont meet projections this year is that hallmark of a scam or inexperience , or bad luck , or being overly optimistic about financing ?
How many people on this board would work for a company with less than $5,000 in the bank ?
Let's hope all progresses. I admit wouldnt surprize me a 1 for 5 or 10 reverse split by end of the year- but if they are progressing on the mill financing and re-opening might not be a negative. Many brokerage firms can't accept stock deposited under $.10 or even $.25, and certainly one would like to see stock issued at less of a discount than currently.
Well, first company is booking according to accounting convention( which I agree I have always found odd), so basically amount that can be converted is what they book + unamortized discount.
Second, you keep using market price. What you posted clearly shows that the note holder converts at market price LESS the discount so with 50% discount they convert at $.01.
Accounting a bit difficult to go through first time around to be sure !
Someone posted that there is some other restriction but I see nothing on filings indicating that.
These shares are converted free trading.
Think of it this way,insetad of buying restricted shares at a discount the note holder gets to choose when they convert and at what discount.Company records according to face value, but value of shares when converted doesnt come into play.
Of course if price drops the amount of shares to be issued increases.
My opinion is still they will reach at least 150 million outstanding this year, and twice the float you mention. However if they can achieve their stated projection stock should do well.
There is a discount to the market price which, unless I am, misunderstanding you , you are not factoring into your calculation. People issue convertibles normally to convert into free-trading discounted shares, your post clearly indicates the % discount to market price. so if discount 50% , and if market price is $.02, the note is converted to shares at price of $.01.
Second, why would you exclude the unamortized discount from face value of note to be converted ? i.e. if note is for $100,000 that is what can be converted. if they book net of the unamortized discount at say $40,000, I really do not understand why you wouldn't calculate shares at the face value. ( Note I do not include interests accruals in my calculation).
I am not CPA but the above seems clear from what you posted .Please let me know if I am incorrect.
Thanks for sending, where is this guide from by the way ?
Hi , even 1/3 oz gold per ton is good. I just went by their own powerpoint. This illustrates problem with this stock, basic information simply not available. Moment they develop a more credible story this stock could soar ! For me that is much more important than permit at this point- higher stock price gives CFO more tools to raise capital to implement business plan.
Permit delays and complications are common, and permit applications can go on for years .Look at the Kensington Mine, they finally had to go to court to get approved. So I do not know that anyone can say that definitely the permit wont be approved in the end.
Whether company can break out of cycle of issuing shares cheaply and having to do another reverse etc, and whether it can achieve its own projections, you and others have been following company and management for longer than I probably have a better take on that from experience than I do.