Member Info for KB007

Ned they can offset their ENSA but if it dilutes below 10% it reverts to a 0.5% NSR which in turn SOLG can buy back for $3.5m

CAPEX for SOLG to take to production is circa $2.7B on their 85% share of ENSA which in turn would mean the costs for CGP would be in the region of $476.5m for their 15% holding

To be frank I do not think CGP expected the discovery to be as big as it is!

As such I believe this has caught them out on interpreting what their share of funding costs would be.

Zoros,

Sure !

FTNY,

When the deal was signed by Alan Martin I was ****-a-hoop!

CGP have already sold SOLG shares to fund their company. Their is a huge reliance on their part on the Cascabel tenement and they will not have any income from that until such times as a mine is up and producing. It can take about 2 - 4 years from BFS to get the mine up and running.

The question is can CGP afford to jointly share the costs after feasibility - a truthful answer would be no !

Can they afford billions of $'s in getting the mine to production in order to recoup. No!

AS CGP took the financing option their ENSA responsibilities are separate as this subsidiary is run by Ecuador and as such ENSA is the legal and beneficial owner of the tenement - (Term sheet 5.1 (a) 5)

SOLG issued stock to CGP in acquiring 85% of the ENSA and the sale of the other 15% would be determined by ENSA alone, not CGP, and in turn SOLG would have that first right of refusal.

CGP has their own subsidiary CESA for the La Encrucijada part of the joint ownership with SOLG and in turn SOLG would have no rights in how CGP determined any sale or takeover of the CESA.

CESA has been afforded the 15% holding in ENSA on behalf of CGP and if the 15% holding dilutes below 10% then the stake in ENSA will be diluted to a 0.5% NSR which will mean that CESA has no equity stake in ENSA and SOLG will have the right to purchase the NSR for $3.5m.

All these points are in the term sheet signed 24 Feb 2014 and filed on SEDAR in July 2017.

I would suggest the knowledgable ones check it out and that way they can maybe correct me should I be wrong.

However I feel my interpretation is correct.

Schlemiel !

You'll note that SOLG states on their presentation the first refusal of ENSA as well as it being stated in many RNS's over the past years. The Term sheet on SEDAR also states (in clause 3 (b) 5) "SOLG shall be granted first right of refusal of the remaining holding of Cornerstone in ENSA)" that is verbatim !!

Further in the term sheet states (clause 3 (c) 2 & 3) summarised

2 - "On completion of feasibility operations shall be jointly funded going forward. If any party fails to fund it's proportionate share when due it's equity in ENSA shall be diluted down by way of transfer to the other party. CGP has 120 days after feasibility to review and let SOLG know in writing whether it jointly wants to fund it's share of the costs. If CGP has not decided within the 120 days CGP will be deemed not to be funding and if CGP elects to fund going forward they will pay the costs from the date of feasibility"

3 - "SOLG shall receive 90% of CGP's distribution of ENSA funds until CGP has fully paid the costs of exploration back to SOLG at a rate of LIBOR plus 2%"

What that means to me is that CGP will have to incur shared costs after feasibility until the production stage before they receive any income and additionally cannot repay their financing option costs until a mine is up and running. Can they afford to do that - I don't think so !

IMHO

SOLG will be able to raise CAPEX through NSR's or streaming finance via Franco - Nevada now that the business relationship is up and running. I agree with Miagi that CGP will struggle to raise the financing for the share of costs moving forward after feasibility out with being taken out however in the event of a TO of CGP the ENSA part of the agreement is non transferable and as a double blow to CGP SOLG has first right of refusal on ENSA as CGP chose the financing option for SOLG to carry the costs.

MAJWandCo , zoos has been on another planet for donkeys ... he has about turned a degree in that he is less negative than he was initially: however I still think he's a shill !

1.2% ... forgot I did that !

will be down to 1% when we hit 30p so I can buy another 500k in OMI

What you think I hold Jerry?

It's okay found it.... $52m

Cornerstone's share to completion of the Feasibility Study of Alpala is debt funded by SolGold and post Feasibility Study, Cornerstone must contribute to all expenses and capital costs. If Cornerstone's equity stake in ENSA is diluted below 10%, its equity stake will be converted to a 0.5% NSR which SolGold can then acquire for US$3.5 million at any time. SolGold's debt funding to Cornerstone accrues interest at LIBOR plus 2% per annum and is to be repaid from 90% of Cornerstone's distributions of earnings or dividends from ENSA or the Cascabel concession. Currently Cornerstone's indebtedness to SolGold is US$30.5 million. The latest budget indicates that this liability is expected to reach US$52.0 million in the period to completion of the Feasibility Study.

Zoros, wrong again !!

AS soon as the BFS is complete CGP need to stump up their costs that SOLG covered for the last 10 years.. circa $85m although don't quote me on it as it could be more as I think $125 was touted by an analyst at some point...

Anyway CGP's share of the costs become immediately payable on completion of the BFS

Colonel talking dogs !!!

SOLG appointed Citi to protect any hostiles; why do you think Citi would sit on shares or manipulate the price in favour against SOLG... tripe !!! Reputation for one would prevent it and I don't know about the legalities.

The strong option now for SOLG is too rapidly bring it to BFS and screw CGP who have no funds to pay their share of costs to ENSA ...!

Cmon GGP 3 years I've waited ...

Over 5 years with OMI which will follow suit soon. ...

Now SOLG please can I have the icing !!!!

I'm doing okay Jerry, got a good amount here, GGP has given me a fourfold rise and still holding, OMI is about to come good and another big holding there, Actually made a profit from Val but out now, INO I doubled my dough, RMS is a good prospect down the line and small gains on my other holdings.

Mock all you like

Please just come back when you go back to being a glass half full guy again.

If you are long term then as you are clearly getting high blood pressure and possibly ulcers with your about turn in the faith you had in your investment from years ago, then if your mind has changed, why are you still here.

Did you think when you invested that a mine would be up and running immediately, when you initially invested we didn't have the other 72 tenements... or did you invest at a peak when we were Solomon Gold and the Solomon Islands rush boosted the SP.

I'm disappointed at reading your woe is me comments when for years you have been relatively positive

Ah that's where your hope for 50p comes from Jerry.... bought at peak then lol

10,749 deaths in Ecuador since Feb 15th, and still climbing.

Think there was more important priorities, plus there was the constitutional court fiasco last year.

You say no drilling for 2 years ! Drills are turning ! Update from April last year...

189,984m of diamond drilling comprising 168 drill holes completed to-date on the Alpala Deposit, representing a further 56,408m of drilling completed since release of MRE#2 with 6,654m of recent drilling with assay results pending..

Now it is obvious further drilling was conducted as it increased the size of the project through the MRE3.

The company does not need to update on assays, if it were the case we would have a news release every day.