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AKGold, every now and then the dividend idea keeps popping up. While I would love to see that at SOLG, where was that ever used in cases like SOLG?

Snugg, we only need to be right once.

0.55 of a SolGold share offered for every one Cornerstone share tendered. Back in January, that would have been a 20% premium for CGP share holders. In January, the SOLG share price was about 5.7 times the price of CGP, today it's 9.6 times that.

NAPOLI!

Zibi, some of those scenes are from my hometown, most beautiful place in the world!

This is from the 2014 termsheet. It can be interpreted in different ways imho, but it looks like SOLG has the upper hand. I really don't understand how CGP think they can afford to antagonize SOLG.

Under the Second Revised Cornerstone Term
Sheet, SolGold has been granted a first right of refusal over the remaining holding of Cornerstone in ENSA.
Additionally, pursuant to the terms of the Second Revised Cornerstone Term Sheet, SolGold issued to Cornerstone, 488,560 Ordinary Shares at a price of C$0.2047 per Ordinary Share, for aggregate gross proceeds of C$100,000.
Cornerstone has agreed to give SolGold 5 business days notice if it proposes to sell all or part of such Ordinary Shares, to enable SolGold to determine if it can identify an appropriate buyer(s) of such Ordinary Shares. In the event that
SolGold is able to identify such a buyer(s), Cornerstone has agreed to sell such Ordinary Shares to the identified buyer(s).

Pad, if my reasoning is not misplaced, then the SOLG offer should look more and more appealing to CGP as time passes.

To answer my own question, CGP seem to gave enough cash for another few months, I think max to mid 2020.
Among their assets they quote a marketable one which is their 15pct of ENSA, otherwise they have liytle to offer. Since their 15pct of ENSA is dependent on them payinh toeards the ENSA exploration costs which they cannot pay, I think that SOLG have them by their cojones. No major has incentive to come to the rescue, Newcrest will have more leverage with CGP about their other JVs when CGP is famished. Dangerous game but brilliantly cruel strategy from NM if I am correct.

When is CGP running out of money?
One scenario we haven't thought about, that seems plausible enough to me, is that SOLG are playing with the timing of their own funding based on how quickly they can run CGP to the ground, just enough to push them to sell their SOLG shares and ENSA 15%, part company, and then move on in different directions. Then we get our funding, CGP are left to swallow our poisoned pill but are free from any future financial commitments, and if any of this is feasible, Newcrest will be happy to watch it unravel instead of making an offer on CGP.
Thoughts?

BNc, thanks as usual for bringing perspective, I have become a big fan EWT myself after your input. I likr this new twist you bring up buy I have a question: shouldn't there be some time relationship betwen the duration of the various waves, and IF that's the case, isn't this correction too long? I like your outlook better btw, mine points south until mid 2020, which I don't even want to really consider.

All numbers are precise earthling, 1.32 as much as 1.00 or 0.50.

Colonel, it's all plausible, although the earlier talk about "conditional" funding has been replaced by "streaming" funding. With conditional funding, as I understand it, you could have a big bond issuance in the form of convertible bonds, while streaming funding would link funding to a form of off-take agreement. ALl we know is that the two terms have been used at different times.

Realistically with everything going on in Ecuador, plus the fact that the resource is still being worked out, the CGP issue has not been sorted out yet, and generally it's not a good time for exploration funding as we learned from Newcrest, it must be an absolute b***h of a challenge for SOLG.

You just made me think about that, and I realized I have been confident since April 2011. That's a lot of confidence!

@coldcut, great job and thank you for taking the time to look into it.

A metal stream is essentially a financing technique structured as a commercial arrangement, namely a long-term contract for the purchase and sale of production from an identified mineral property. As such, in some ways it resembles an offtake arrangement, while in other ways it can be likened to a royalty with some additional features of a debtor/creditor relationship.

Under a stream, the purchaser (typically a specialised streaming company) is granted the right to purchase from time to time a quantity of metal representing a percentage of production from the mine at a significant discount to the spot market price of the metal, all in exchange for an up-front cash payment that constitutes a deposit against purchases to be made under the stream. As the reference mine produces, the purchaser pays the mining company the discounted cash price for metal purchased (ie, per pound or ounce of product). In the early years of the stream, the difference between the prevailing spot price and this discounted cash price is applied to reduce the amount of the upfront cash deposit; once the deposit is exhausted, the purchaser only pays the discounted cash price for the remaining life of the stream. The stream generally is intended to be a long-term obligation of the mining company, often life-of-mine or for a term of 25 years or more.

Notorious streaming finance companies (are we dealing with any one of these?):
- Franco Nevada Corporation
- Royal Gold Inc.
- Wheaton Precious Metals Corporation
- Osisko God Royalties Ltd.
- Sandstorm Gold Ltd.
- Abitibi Royalties
- Metalla Royalty & Streaming Ltd
- EMX Royalties Corporation
- Sailfish Royalty Corporation
- ELY Gold Royalties
- Mavrix Metals Inc

I suggest some reading about the trend towards streaming and its economics. If anything we might want to invest in these companies!

Stream financing, also known as resource streaming or metal purchase agreements, is becoming increasingly popular in the resources sector. Stream financing can be used to help bring a development stage project into production or to expand existing production capacity of an operating mine. It provides an alternative way of raising capital for a project at a time when market conditions make equity financings very dilutive and debt financing difficult and expensive to obtain.

Sweet, we can do with C$1.68....

"We would note that any potential streaming financing could be of the $1 billion plus size due to the enormity of the Alpala resource and could substantially remove any perceived “financing” overhang for the stock."

In a typical metals stream financing, a streaming company makes an upfront payment to a resource company in return for the right to purchase a fixed percentage of future production of one or more metals produced by a project, and makes on-going payments for each unit of metal delivered under the streaming agreement. Streaming transactions are generally long term in nature and are often for the life-of-mine. The upfront payment may be payable in one payment at closing but, for projects in the development stage, is often advanced in stages as the resource company reaches certain construction milestones.