Finally, A No-Nonsense Post to the Rescue
Here is some Common Sense Info, Take your time to read it all, not just the cover.
Reposted from Doc at MP
Quote from: brecciaboy on Today at 05:01:43 PM
"SOME THOUGHTS THAT I HOPE MIGHT ALLEVIATE SOME ANXIETY AMONGST SHAREHOLDERS:
1) First of all, I have no idea of the proximity of the JV agreement being worked on. Yet once again it “feels” close but I really have no clue. I have the distinct feeling that if one is executed it will be dropped on the shareholders when they least expect it. This is how it should be. I also know that people react to frustration in different ways. Some people roll up their sleeves and figure out a way to proactively dig in to help relieve their own anxiety as well as that of others. The first inclination of others is to lash out and do damage to any party that might have a causative role in their frustration whether it is of that party’s doing or more circumstantial. People are different.
2) I’m not sure if management is going to address the 2 rather interesting “notices of litigation” brought up on the various blogs recently but I imagine they do find the timing to be very interesting (do not interpret that as involving the proximity of any JV deal as I have been through so many dry runs that I haven’t a clue). One school of thought says that dignifying those with an explanatory rebuttal might feed into their intent IF their intent was to distract management from the task at hand. The other school of thought is that once the issue is raised it needs to be addressed lest management’s refusal to address them be interpreted as a plea of guilty. My personal attitude is that only a moron would dignify those remarks or any remarks made in regards to any possible future litigation as it can only work against the corporation and its shareholders. I guess the bashers might win this round if the intent was to stir up shareholder anxiety and induce selling but as far as delaying any deal I would rather doubt it.
3) For those major shareholders that have been approached over the last 5 years by “BB” (one of the parties threatening legal action)you know exactly what is going on and you probably sleep quite well at night as his actions speak directly to the value of the property and the future value of shares.
4) Greg has been constantly riding JJ for many months to communicate more often via “updates” and “Q and A’s”. Greg is currently paying all of the bills for Medinah USA and has been for a very long time. He just cut yet another check to the new promo group which might indicate what he thinks is going on but by the same token he was paying about $7,000 per month for the Las Vegas office well before we needed one. “Following the money trail” often leads to the truth when visibility is limited.
4) Greg is a board member and JJ is the hands on "management" as well as a board member. When Greg signed on as a result of Larry Regis’s urging he made it explicitly clear that his plate was currently full but he’d help out where he could as a favor to Larry. JJ is equally busy with many corporate responsibilities over and above his roles for Medinah and Cerro Dorado which are front and center in his life. His legal practice has taken a back seat due to his involvement with Medinah and Cerro Dorado and his efforts to conclude the long overdue joint venture on the Lipangue property complex.
5) JJ is 100% embarrassed about the Sumitomo and Hochschild "leaks" and is naturally paranoid of a recurrence. In retrospect, this may have been a blessing in disguise as gold has moved up enormously since that timeframe but admittedly that doesn’t alleviate the current shareholder anxiety.
6) The "pendulum" of JJ's communications has quite naturally swung from too communicative to totally buttoned up and he keeps cutting the checks. His superior visibility of the finish line and hopefully its proximity probably makes his mindset become “just hang in there shareholders we’re almost there” and I assume he sleeps well at night. That mindset, however, doesn’t fly with frustrated shareholders watching the share price tank in that they have not arrived at a similar comfort level because of the lack of an insider’s view of the finish line and its proximity and the lack of communication. JJ’s seems to be in a catch-22. Does he communicate more and risk sabotaging yet another deal or does he keep quiet and risk the ire of already frustrated shareholders?
7) There appear to be some very big powers at the table and apparently JJ does not want to allow Medinah to present itself as a bunch of nonprofessionals that can't keep a secret and are not trustworthy business partners. Mining is a very secrecy-obsessed business and loose lips do indeed sink ships as we have painfully learned.
Greg is at wits end with JJ's lack of communication and his being held responsible for JJ’s “communication pendulum” being where it currently is BUT HE UNDERSTANDS IT AND HE REALIZES THAT IT IS WHAT IT IS and lo and behold he keeps cutting checks while dodging shareholder bullets. One must keep in mind that JJ is indeed a very caring person and his leak at the AGM many years ago was made in an effort to REDUCE shareholder angst. He could have pulled this deal away from Medinah while they were technically in default 3 or 4 years ago but he didn’t. His historical relationship with Les is to thank in this regard.
9) JJ's mindset at this moment in time appears to be that anything that's already been communicated to shareholders, anything that might violate an NDA/non-circumvention agreement or anything that might negatively affect Medinah’s negotiation strategies should not be put out into the public domain. Perhaps he’s in a “once bitten twice shy” mode. From a frustrated shareholder’s point of view this attitude sucks right now. Greg’s recent trip to Chile answered a lot of his questions and he confirms that they were in nonstop meetings in Chile with about 5 different parties some of which are interrelated.
10) When a tiny unheard of junior explorer is negotiating with billion dollar major miners there is no such thing as receiving “earnest money” and the like unless the junior is willing to give up something and that typically is “exclusivity” i.e. in exchange for your earnest money we promise to only deal with you while fine tuning the details in contract form off of your previously tendered signed term sheet.
11) Until a breakthrough occurs on any front management and the BOD currently are in a “no win” scenario yet they keep cutting checks. Half of the shareholders say "communicate more" others say keep quiet until the big news arrives. Management is screwed no matter what they do because anything they put out short of a huge press release will be dissed by the half of the disappointed shareholders thinking it was “the big news” and the other half preferring silence UNTIL a breakthrough is made. Individual shareholders frustrated by delays seem to think they have the right to vent their frustration at management and the BOD and perhaps they do. This is especially true if they own Microsoft or GM and their venting of anger has no chance of rocking the boat for all shareholders. The trouble in this particular deal is that the 2 guys that just so happen to be paying all of the bills, making all of the personal sacrifices and with the most to lose are the only parties available to vent at. That sucks for all of us BUT IT IS WHAT IT IS. This reality seems pretty dangerous to those of us familiar with the history of this company that have learned to bite our tongue during these seemingly endless delays. The reality that very few seem to appreciate is that nobody is more frustrated than GC or JJ who have put a lot more money, hours and personal sacrifices in than any of us could ever imagine. The naked short sellers must be just relishing the current chemistry of this deal.
12) JJ reportedly just cut yet another large personal check recently on behalf of Medinah for the Pumillahue project. I don’t think people realize how cash intense the mineral exploration industry is and how fortunate Medinah shareholders are to have some (perhaps used to be) deep-pocketed insiders.
13) Another example of the “management can’t win” syndrome has to do with updates or Q and A’s coming from JJ. After an update a year or so ago the shareholders absolutely teed off on GC for allegedly “over-editing” JJ’s updates. GC’s attitude became OK “ask and you shall receive”. The next update came out in the broken English that one might expect from a Chilean national. Management once again got attacked this time for putting out such an “unprofessional” update. Well, which is it going to be as once again those doing all of the hard work, making all of the sacrifices and paying all of the bills are screwed no matter what they do.
13) The shorts are playing the psyches of frustrated shareholders like a fiddle. It is so easy to induce panic selling under these circumstances that they must be in basher heaven.
14) As it stands now the experienced “tongue biting” shareholders familiar with Medinah’s unique history have a new concern. It’s the activities of those without the discipline to bite their tongue that claim that they have “the right” as shareholders to vent their frustration. All that the disciplined “tongue biters” ask is that these admittedly frustrated folks firstly exercise their right to do thorough due diligence so that they can learn what repercussions might be associated with their exercising of these rights to vent.
15) Interestingly, Greg is averaging 2 or 3 calls per day from naked short sellers wanting to buy large blocks of stock out of the treasury. They are digging a very deep grave as all Medinah needs to do is make some headway ON ANY FRONT whether it be Lipangue, Pumillahue, LDM, a certificate registration effort or the Polo claims. When I say making some headway on any front I mean that with gold at $1,200 you don’t need a potential flamethrower like a Lipangue JV to light the fuse of a bomb the shorts have been building for 12 years.
16) Hopefully the Medinah shareholders that have not been through one of these naked short selling “bear raids” can appreciate that management with no “Directors’ and Officers’” (“D and O”)insurance is highly incentivized to error on the side of being LESS communicative than more communicative especially when it comes to releasing good news prematurely. For these people their families come in front of even the Medinah and Cerro shareholders. Can you imagine the frivolous lawsuits being initiated by those meaning harm to the corporation if the share price advanced markedly upon the release of good news that was not 100% ready to be released and the share price fell back down precipitously when people learned that things weren’t 100% done yet. Trust me when I tell you that our enemies sitting on a 1 billion share naked short position are dying for a management screw up.
17) Yet another litigation was brought to my attention 2 hours ago in regards to our shareholders not getting delivery of demanded for certificates over a very long time. In this one the amount of shares obviously naked shorted was either in the high 8 digit range or low 9 digit range. In the other litigation the naked short sold shares were well into the 9 digit range. In this latter case the criminal proceedings have already commenced with the civil proceedings to follow. With some information received today the net open naked short position being 1 billion shares plus or minus 100 million appears to be extremely solid. We are not going to bother JJ to canvass the street name shareholdings held in Chile until he is done with the tasks at hand.
18) My advice is to expect the unexpected from those that racked up this naked short position. We did a study over at “DeepCapture.com” a few years back of I think it was 15 heavily naked short sold corporations. Either frivolous lawsuits or the threat of frivolous lawsuits occurred unanimously when these battles heat up. Of the lawsuits 14 of the 15 were filed by the same now bankrupt legal firm. The Internet bashers are probably going to intensify their efforts soon. Their job is to induce “FUD” i.e. Fear, Uncertainty and Doubt. When there are an extra 1 billion readily sellable “security entitlements” in your share structure then inducing a certain percentage of the buyers of BOTH real and fake shares to panic sell can be powerful especially if your employees might be forced to cover those positions in the near future. This anxiety is no fun and hopefully our overdue rewards are within sight. A special thank you to management and the BOD and your families for your generosity and for putting up with us. dr. d
(Disclaimer: Do not buy or sell shares based upon this communiqué. It’s intent was to provide some educational information and to create a sense of balance with what is being said on the Internet blogs.)
