Member Info for mattlilly

In fact I'm wrong and this is now serious for CGP...

The original agreement says:

"At this stage, SolGold would have an indirect 85% interest in the Cascabel project. SolGold shall carry Cornerstone through a 15% interest in the project to completion of a bankable feasibility study on SolGold's schedule and budget."

The definition of a 'bankable' feasibility study is:

"A feasibility study is "bankable" if it has been prepared in enough detail and with enough objectivity that the company could submit it to investors or lenders when seeking financing for the project."

Given that NM is working towards the PFS being coterminous with the Contingent Financing Plan, I would read the PFS as the BFS...

So that begs two fundamental questions:

How will CGP finance the costs from completion of the BFS through to net positive cashflows, as the only costs they can defer are those up to the completion of a BFS

How on earth can they not have a contingent liability, not only for these costs, but also for the prospective $420 million they will have to stump up as part of the financing...we're not talking about costs here, we're talking about the finance to PAY the costs...

Wow! $7.7 million is a drop in the ocean...

Oh and BTW, having examined the 'corporate governance' shortfalls that CGP alleged, it seems to be only an incorrect N43-101 Report which SOLG refiled on 15 September...

Wow!

EGM what EGM...its all smoke and mirrors...meanwhile the CGP SP has fallen 15% from the meagre high they achieved...

From my reading it would be the Definitive Feasibility Study Quady...rather than Preliminary ,

However, if it were the latter it would explain their original statement, still in their November presentation that the PFS won't arrive until Q1 21...

And finally, there is the matter of 'going concern', which is fundamental to the viability of any company and here is what they say:

"The assessment of the Company’s ability to continue as a going concern and to raise sufficient funds to pay for its ongoing operating expenditures, meet its liabilities for the ensuing year, and to fund planned and contractual exploration programs, involves significant judgments based on historical experience and other factors including expectation of future events that are believed to be reasonable under the circumstances.
The Company’s business of exploring for minerals involves a high degree of risk and there can be no assurance that current exploration programs will ultimately result in profitable mining operations. The Company's continued existence is dependent upon the preservation of its interests in the underlying properties it acquires, the discovery of economically recoverable reserves, the achievement of profitable operations, the ability of the Company to raise additional financing, if necessary, or alternatively, upon the Company's ability to dispose of its interests on an advantageous basis. Changes in future conditions could require material write-downs to the carrying values of the Company’s assets. "

And finally, how can they possibly take these apparently directly contradictory positions:

"Consequently, because there is uncertainty about the completion of a positive feasibility study no provision for a contingent liability for the repayment of the Carried Interest has been recorded in the Consolidated Statement of Financial Position."

While valuing their interest in ENSA at $72 million as follows:

"Based on the enterprise value of SolGold, the valuation firm has calculated the implied mine value of the Cascabel project using the following key inputs:
• Risk adjusted CuEq lbs of 18,537 MMlbs
• Value attributable to Cascabel $/lbs ranging from 66% to 73%
• Adjusted $/lbs ranging from $0.026 to $0.028
• Marketability discount ranging from 0% to 10%"

Further astonishment on their Accounting policies, especially re Contingency:

They are using definitive forecasts of the completion of PFS and DFS in their public statements and presentations in order to validate the underlying value of their investment in Cascabel, but they make this statement in their Financial Statement:

"By their nature, contingencies will be resolved only when one or more uncertain future events occur or fail to occur. The assessment of the existence and potential quantum of contingencies inherently involves the exercise of significant judgments and the use of estimates regarding the outcome of future events."

Even if they made a mistake on the date of the DFS, it is still scheduled for completion no later than just over a year from now and yet they carry this outrageous statement in the FS as well:

"Consequently, because there is uncertainty about the completion of a positive feasibility study no provision for a contingent liability for the repayment of the Carried Interest has been recorded in the Consolidated Statement of Financial Position."

A quite astonishing conflicting statement...furthermore, while they don't say so anywhere, the only possible reason for saying there is uncertainty about a positive feasibility study is if they believe there will be a bid for Cascabel or Solgold...

Furthermore, they predicate their $18 a share valuation on the value of Solgold/Cascabel which could only be remotely true if the project goes to production.

Quady...I know their share of cots is significant and although they can be funded out of future Alpala revenues, they actually have to start paying their share of Alpala costs as soon as the DFS is completed (see below).

My reading of this is that, while the costs incurred up to DFS can be deferred as above, any costs incurred between DFS and net cashflows from production have to be paid immediately...

The prospective need to fund raise $420 million immediately after DFS is far more damaging and indeed I believe this will crystallise as soon as SOLG announce the CFP, which could still be by end December...which may partly explain why CGP's SP, far from being $18 is now virtually where it was on 14 September...and could well sink lower after the equity raise...

Meanwhile, further to the point about Contingency, the statement in the MDA says:

The Company has no significant contingencies other than which are disclosed under note 15 of the Company’s annual audited consolidated financial statements."

Note 15 says:

"Environmental contingencies: The Company’s exploration activities are subject to various laws and regulations governing the protection of the environment. The Company conducts its operations to protect public health and the environment and believes that its operations are materially in compliance with all applicable laws and regulations."

The only vague acknowledgement is this:

"The Company has no significant source of operating cash flow to fund its exploration and development projects. Funding for projects requires equity or debt financing. The Company has limited financial resources and there is no assurance that funding will always be available to allow the Company to fulfill its obligations on existing or future exploration projects."

What planet are they living on...As a FCA qualified Auditor I would be qualifying their MDA and Financial Reports...

CGP's latest filed MDA states:

"SolGold has announced that the PFS is expected to be completed prior to the end of Q3 2020, with a
definitive Feasibility Study scheduled for completion at the end of Q1 2021."

Apart from the fact that it directly contradicts this statement from the latest presentation:

"Pre-Feasibility Study (“PFS”) underway, expected to be completed Q1 2021, with definitive Feasibility Study end of 2021"

Which means they are either incompetent or wrong, but...

If the first statement is true and the DFS is "scheduled for completion at the end of Q1 2021."

This would be incredibly bullish for SOLG, who currently have this as by End Q4 21 and, from Cornerstone's own MDA the following statement means that they will have to start paying their proportion of any costs for Cascabel from the date of completion of the DFS...if their MDA is correct, that would be from 1 April 2021 and yet they have provided no contingent liability...

"Subject to the satisfaction of certain conditions, including SolGold’s fully funding the project through to completion of a feasibility study"

And I know we've had the debate about Cornerstone's liabilities, but the following is significant, because it mean that although they can repay

"the Company’s financed costs to completion of the feasibility study at Libor plus 2% from 90% of the Company’s share of the cash flows from the Cascabel project"

they have to find 15% of the CFP amount immediately after the DFS is completed...how on earth are they going to do that...? We're talking about, prospectively, $420 million, when they're struggling to raise $7.7 million just to keep the lights on. They say they will have no difficulty raising the money, but which banker is going to lend $420 million while Solgold has total control over the scale and pace of development of Alpala...?

"Pursuant to the agreement, SolGold will finance the Company’s 15% interest in the project to completion of a feasibility study on SolGold’s schedule and budget. Cornerstone’s intention is to monetize its interest in Cascabel, but if it is unable to do so on acceptable terms prior to completion of the feasibility study, then it intends to finance its 15% of Cascabel expenditures following completion of such feasibility study, which would be US$150 million for each US$1 billion of capital cost in the event of a positive feasibility study leading to a production decision."

UT at 36.35 down 3.3% on the day...despite the 244k purchase...!

Oh and they closed out at £791 million...

Manchester United were a quoted PLC...

The Glazers started in March 2003 with 2.9% bought in the market...by October they had increased that to 8.9%...

By Feb 2004 they were 16.3% when they instructed Commerzbank to explore a takeover...

By June they were up to 19% and still not the biggest shareholder, but by October they were approaching 30%...all so far by market purchases from the likes of you and me and smaller holders...

On May 12 2005 they persuaded three other significant shareholders to sell, taking them to 62% and by 16 May they were over 75%...theiur final offer was 300p on 23 May...game over...

They had started at around £2 a share and United had a 'diverse book', with fans determined not to sell out to anyone, especially the Glazers, but at least 50%v of the shares were held by them and they all succumbed in the end...

Mather and the Directors hold 20.94%...

Are you saying that with the diverse book (which includes Institutions under the 3% level, like Valuestone with 0.6%) and ourselves, the company is safe from a bid...?

Tell me who of the 89.06% would reject a 100p bid if it cam now from BHP, NCM, Barrick, etc....or a bid at 150p if it came from the Chinese, desperate tis secure an armlock on global copper resources...?

The diverse book would work in their favour...

Oh and BTW you can't compare with FTSE100 stocks...their books are massively diverse, for example BHP's largest single investor is Blackrock with 10% (sop we can guess who they would support...) and there is no other single investor with greater than 3% (apart from Nominees)...that's what you call diverse...

I suspect that part of the reason for the two RNSs is that NM wants us to get used to using our votes in case a bid comes along...

Oh dear Quady...a diverse book means more shares in 'non insider' hands...we have three investors with a 'foot in the door' and a fourth prepared to sell to the highest bidder...

A diverse book means a successful takeover would be easier to achieve provided the bid is high enough for the competing major holders to accept...it also increases the possibility of a 'concert party' between two...

And finally it reduces the chances of a 75% resolution getting through if you p**s off any of the holders...Nick didn't do that did he...?

AIMO as usual...

What specifically FTF?

Got it Luke...apologies...too quick on the trigger...

GGP not CGP...can't you read...

GGP will end up with only 25% of Havieron...

You're right Miagi...the power of the EGM which can be called at 2 weeks notice, rather than give carte blanche for a massive share issue without knowing the terms...

We had four further updates in the following 4 weeks...

We've had broken promises on PFS and no rebuttal of the CGP statement

Rio rigs were mobilised in October...we've had nothing on Blanca and La Hueca and POR must have reached 1500 meres by now...

So why is NM manipulating the news flow while begging us for our support...?

"our SP is predominently not driven by movements in the price of copper and gold?"

Nor is GGP, up 1300% since Jan 1 and now with a MCap £127 million bigger than ours, despite only a minority stake in a 'Tier 1' asset...we've already got at least two of those and probably three...

NM has absolutely no idea how to manage a share price, otherwise why has he just appointed a new Head of Investor Relations...?

Says it all really...

October 9...$3.14...SOLG hits an intraday 3 year high of 43p

November 26...copper hits its 4th daily 7 year high in the last five trading sessions, at $3.37...

SOLG up 1% in the same period and still down 13% since 9 October...languishing despite a supposed pipeline of news...

BHP up 10% in last five sessions...ANTO up 11%...ATYM up 5%...

Nuff said...

I agree Schlem and Interactive Investors are all over me like a rash with 3 emails to VOTE in just a few hours...

Remember were talking about a Board that until recently was dominated by Moeller and Mather...the DGR duo...they were kneejerked into change by CGPs Corporate Governance challenges...NM still dominates the Board...

Now that makes a lot more sense addict...well spotted...