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I sold my 4M shares at 0.0021 avg. 150k hole on this
why is every one jumping to conclude WITS won burnstone?
WITS just made their offer while negotiations going on with 3rd party acquirer and botching about their offer and dreaming like many shareholders here how much they can make out of it if their offer is accepted and voted on July 11th
Why WITS botching about its being selected as a sole preferred bidder?
Could not believe no other offer is better than WITS offer!
Yes. It is BS and we get nothing. Even creditors get shaft if they accept this offer
so Wits wants burnstone be successful. Let's see how creditors look at this offer and if they restructure the debt and let burnstone operations continue under southgold.
The volume should come in now any moment with BR plan published out to all affected parties. The cat is out of the bag and all affected parties who would receive the plan probably in the know of this 3rd party offer.
If burnstone pays off creditors ($286M USD) and settles all unsecured creditors of southgold even with fraction of recoveries, then what happens to hollister's 15% royalties stream to the bankruptcy trust? Will debenture holders take next in the priority to receive 15% royalty streams for their difference paid through their cut in southgold sale proceeds?
There is possiblity of some recovery to N6C resources (hopefully more than $50M USD probaly including interest obligation to Investec. According to monitor it's only a fraction of total debt. How much of 392M, approved final balance of claim by BRP is the question!)
Monitor's 10th report was based on sale proposals received from bidders on April 15th but notice there is a 3rd party acquirer from that point on introduced into sale negotiations and who knows what that information is? Monitor has signed off and relieved itself submitting to the court from any liabilities/conflicts/legal motions etc. So one can not hold monitor for dissiminating the 'factual' info available at the time they had that info.
Including N6C resources for the approved claim balance of 392M to the list of unsecured creditors is a glimmer of hope and the fraction of funds to N6C is going to be 31% of it same as its voting interest.
Does any one see if "Finance parties Claim" is different from "Security SPV" claim?
shows same amount in the table.
N6C resources is placed as one of 'concurrent creditor' along with note holders with an approved claim of 401M (CAD).
N6C resources is a subsidiary of GBGL.
But N6C resources along with N5C resources are guarantee to Investec loan to Tranter. I am not sure why GBGL has signed a guarantee agreement to tranter for purchasing back tranter's 26% interest in Southgold shares with 19M GBGL common shares.
Btw, tranter burnstone is (for the requirement) black's empowerment subsidiary formed and subscribed to and 'purchased' 821 shares of southgold constituted 26% interest in southgold.
It is all complex structure and agreements made that are in place and seem like a orchestrated failure.
OFF-BALANCE SHEET ARRANGEMENTS
On February 22, 2007, the Company entered into a framework agreement to achieve compliance with the requirements of South Africa’s broad-based Black Economic Empowerment Act in order to secure the new order prospecting rights in respect of Burnstone. On October 1, 2007, Tranter Burnstone (Proprietary) Limited (“Tranter Burnstone”), as the Company’s Black Empowerment partner, subscribed for and was allotted and issued with 812 new ordinary shares (“the Southgold Shares”) in the issued share capital of Southgold, a wholly owned subsidiary of Great Basin. The aggregate subscription price paid by Tranter Burnstone to Southgold was $37 million (ZAR260 million). The 812 new ordinary shares constituted 26% of the issued share capital of Southgold. Subsequent to the completion of the above, N6C Resources Inc. (“N6C Inc.”), a wholly owned subsidiary of Great Basin, purchased the Southgold shares from Tranter Burnstone in exchange for 19,938,650 common shares of Great Basin issued to Tranter Burnstone.
The Company, through its subsidiaries, N5C Resource Inc., N6C Resources Inc. and Rodeo Creek Gold Inc. signed a loan guarantee agreement pursuant to the conclusion of the transaction with Tranter Burnstone.
On October 1, 2007, Tranter Burnstone borrowed $28 million (ZAR200 million) from Investec to settle a portion of the purchase consideration of $37 million (ZAR 260 million) for the 812 Southgold shares. The security for the loan comprised, amongst other items, a loan guarantee which require N5C Resources Inc., N6C Resources Inc. and Rodeo Creek Gold Inc., in the event of default by Tranter Burnstone on any of its interest payments to Investec, at any time for the first four years, to lend not more than $11.3 million (ZAR80 million) to Tranter Burnstone in order to settle such repayment obligations.
The loan agreement with Investec requires Tranter Burnstone to deposit cash into a margin call account if the underlying value of the shares held by Tranter in Great Basin Gold is less than the outstanding loan and accrued interest. The decrease in the share price of the Company since September 2008 triggered the requirement for a cash deposit into the margin account. Tranter Burnstone defaulted on funding the short fall in the margin call account and the Company has been advised that Investec served Tranter Burnstone with a notice of default in December 2008. A notice of foreclosure has not been served on Tranter and the probability of the guarantee being called upon remains uncertain.
That can not be true. Monitor (in my opinion even with its lousy calculations) said unsecured creditors will only recover fraction of their debt which implies CS gets out with all the respect
first of all, BRP still has not yet been published. Monitor's report is vague, i say, as they seem only consider cash proceeds from the deal and 'understands' its limited distribution potential to unsecured creditors.
Receivership over GBGL was placed but not including burnstone mine. However, cash proceeds (after paying off CS debt) and any royalties etc from southgold sale will be administered by the receiver.
What if a sale agreement/BRP plan consists of more than just cash? We know Hollister with just 0.5M ounces of gold was 'disposed' off for a potential of upto 110M. Not saying we hit the max of it but even if we hit 50% of it will be 45M. Now, you see, monitor did not take into account hollister's 15% royalties. Also i do not expect monitor accounted for any other clause than cash in burnstone sale and thus of the opinion that it expects no payments to debenture holders.
But like finny said regarding a shell company, why would any one buy burnstone mine for cheap and tout with a shell company (even 90% shares owned) they would buy seperately and turn around to split profits even if to a minority shareholders. That does not make sense.
At the same time, it's beyond me and too much of a coincidence if some body is just wanting to acquire GBG as a shell company to use it for something else without any knots to its burnstone asset.
I agree. That's stupidity but then how do you explain where shares are going and why any one (remote chance of being an individual) or entity have been acquiring them?
not even acquiring sounds like 'transferring' shares quietly under the radar
I'd think people do not care any more to collect pea nuts dumping at sub sub penny prices. I can not dump the garbage I have as there are no buyers with big lot bids.
Ain't going to speculate over that. Just need 70M+ volume on the upside close to a penny and i will get out.
yes. you were right. I have to figure how to sell my shares.
except, with the suplement monitor report, there are no assets left to be seized by and for CS even after CCAA termination. Burnstone is under BRP and can not be siezed. However, burnstone probably sold for a 50% of its book value that is less than 350M. My understanding is that Creditors/DIP lenders and Adhoc group including bond holders have to settle those funds per the settlement agreement. Now the only hope is to recover from royalties for shareholders if any in the sale agreement. our monitor, as we have seen, would not take into account spread out royalty payments.
Even if some NPIs (not sure how many years) goes to creditors/bondholders after they distribute cash proceedings from the sale, probably after a few years, GBGL receiver gets some NPIs at a cost of administering these accounts and from remainings probably we see a penny or two distributed for a few years after all obligations are met.
Tamaman, whoever sold yesterday are all the people attached to this message board after monitor's discouraging report was out. I do not think any major shareholders have followed GBGLF CCAA and BRP proceedings day to day like we did. I think the volume should come in on the BRP plan release day or the following day whether positive or negative.
Hope i will be able to sell into that volume even if it is negative to add to my trading losses for continued tax write off year after year :(
But the question is who has sucked up those 10M shares yesterday and 3M shares today and what is their hope?!
I thought there is going to be another heck of dumping today but not! Also I do not see big lots at the ask. Some one sucked up all the dumping of shares yesterday and is watching quiet! :)
I do not find anywhere in the monitor's report talking about 15% NPI from hollister mine using towards paying off CS debt on hollister mine. Basically monitors treats hollister sale as just 15M and thus insufficient funds to pay DIP lenders and to cover councel and other charges. If burnstone strike the similar deal, I do not see how monitor would see it otherwise than just treating the cash proceeds in the sale as probably insufficient to lenders and unsecured creditors and came out with its 'expectations' and 'understanding'.
I guess we will find out soon. I could not wait to see BRP's 'Business Rescue Plan' and to know about this '3rd party acquirer'
This is what is MMs disguise in paradise. They might even take this to where they want and dump on people who are innocent to buy based on volume/pps and trend :(
who is still buying that it's bounced a bit today? :)
FTI consulting Inc is appointed as receiver to GBGL not to CS but it does not matter. If the information received by Monitor is true regarding proposed burnstone sale agreement, this is over. However, monitor has 'outdated' information and BRP extended dates to publish the plan saying the delay is unavoidable due to 3rd party acquirer negotiations. Note the '3rd party' mentioned as an acquirer. Also as some one saying GBGL is probably (have to check docs) one of unsecured creditors to SouthGold.
I will wait for BRP plan before abadoning shares. What about you?
that is very strange! They are royally (through court proceedings) 'winding' up all :)
Dano, what do you read of Monitor's 10th report?
I could not yet digest the report saying "Monitor understands that Southgold's unsecured creditors will recover only a fraction of their total debts"
Under liabilities/creditors, the debt totalled is about 415M.
It sounds like Monitor probably were informed about cash proceeds in the sale agreement and thus monitor's of the opinion that unsecured creditors recover only a fraction of their debts.
Also interesting to note that the total DIP loan 54M and entire existing lenders loan 230M are all being accounted to come off from burnstone sale proceeds and thus monitor 'expects' there will be nothing left for unsecured creditors?
pretty much they have flushed off every one. I will dump after BRP plan as i want to see through the end
very suspicious
there seems to be 3rd party acquirer (I would take that as outside of received bids via bidding approval process) and negotiations going on.
Monitor can easily defend that 'based on the information received at the time' and company can defend 'based on the situation at the time'.
Still hoping
I will wait for the BRP report to see how royally we got screwed and how well BRP rescued the company! Could not believe that any of 3 offers did not even hit the book value!
Look at section 7.3
gosh ...monitor says we got screwed
Meaning?
any one thinks they covered their probably massive short position after it's opened for trading on a foriegn exchange? or just drove the pps down using the same shares trading between their own accounts
The guy sounds like HRc60 :) but strangely I secretly admire his words and pray his words from his lips to god's ears.
Thanks dan.
In the scenario like this, shareholders get screwed
24Million ounces? Where did you get this resources number from?
We all know that one company big or small is not going to throw all the cash they have to buy burnstone needing some signficant capital. It must be JV terms by which creditors must have been rumbling about to accept/adjust or reject. I do not know what that means to shareholders. Probably shareholders will do better in long term if burnstone turns cash positive and in expected duration. We are probably looking at dead money for a course of time now
Some people kept saying burstone has 24M ounces of gold but i find only 12M ounces in my reading. Where is the other 12M ounces?