Cerro/Medinah/Auryn- 2018 Q2 General Discussion ⛰

You may want to lookup minority shareholder rights in a Chilean SpA company and let me know what position Medinah was in last October to challenge the move. (a good move for mdmn shareholders, imo)

It is not that difficult to understand. . Say MDMN own 50% of Auryn and Auryn owns 100% of all the properties and CDCH owns nothing to make things simple and say those properties have a book valve of save $5M. Then Auryn invest $10 Million into the company of which 80% has been spent on capital improvements and has $2.0 M cash on hand, of which our ownership is reduce our to 25% to fund. Then Auryn agreeing to transfer the assets to third party CDCH . So what should be transferred its $10M asset, plus capital improvements of $8M and cash on Hand of $2.0 M or 15M in total on to the books of to the new company CDCH of which we now own 25 % . We should get 25% of the original $10 m plus 25% of the $8M capital in improvement Plus 25% of the cash on hand. The way this deal is structure it appear only the title in the properties have been transfer and not the contribution we made to the capital of AURYN…

This makes absolutely no sense at all except for Auryn as why would MDMN agree to this transfer without transferring the capital structure of Auryn. MDMN and CDCH are not being dealt fairly in giving up its ownship in Auryn. JMO

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Does not make it right or fair and you as CEO should never have agreed to it . BE is right!!! I guess that is why they never shared the agreement as they promised. I never seen such a crock of BS.

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You can say all you want but minority interests should always getting an accounting of their interest even in a private company. BTW I thought Auryn was a Italian SPA?

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I wasn’t CEO when it occurred. Even if I was I would not have objected given the current state of affairs at the time I left.

And you are 100% wrong if you think MDMN had any ability to prevent the AURYN / CDCH deal.

I guess you don’t remember how easily LP and JJ shuffles property after property in and out of the various Chilean sub companies.

Italian? No. It’s always been a Chilean company.

What is the way forward for this company and shareholders? Pointing fingers is unproductive and does not show the best way forward.

It is still possible things may work out for the long time shareholders here eventually. I still believe that AURYN is not ready to promote exploitation of the Caren adit veins and the rest of the properties until all 7B shares are consolidated. It will be necessary for a portion of the AS being free trading and some held in reserve for treasury shares. This was outlined by HR and me quite sometime ago. Shareholders need to know that until CDCH shares are free trading (and treasury shares are available to fund the mining), there is unlikely to be cash flow from exploitation. Shareholders expectations of much news before shares become unrestricted to promote and focus upon the activities on the mountain moving forward are unrealistic.

Continuing the discussion from CDCH - Discussion:

The closest thing we have to AURYN becoming publicly traded is CDCH’s claim ownership, and AURYN’s majority interest is not free trading, yet.

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LOL it is not about what they can and can not do, it is all about what is fair an equitable. I guess I was wrong about you being CEO but I guess it also does matter since I was also wrong about Auryn being fair and equitable as well!

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B.E. I could not agree more !!!

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Trust me, you don’t want fair and equitable. Medinah dealt fraudulently with AURYN and its shareholders, in my opinion. The largest shareholder of Medinah bought shares and entered an agreement based on misrepresentation by Medinah’s appointed Chilean representative and by extension, its BOD.

You want fair and equitable? You’ll have nothing left. The property was never controlled by MDMN USA or its shareholders – all of whom were poorly served and represented by the previous parties.

Medinah never had any money, and for all appearances, was kept cash poor on purpose.

That is all water under the bridge at this point. It appears that everything will be consolidated into CDCH with MDMN shareholders getting shares of CDCH, CDCH being consolidated, and AURYN coming public through CDCH. This was all written and explained.

The sooner it happens, the better for all of us.

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Kevin, what do you view “Auryn coming public through CDCH” to consist of? The properties are in CDCH already. Employees can change companies at will and managers are already listed on Cerro’s web page, obviously without salaries at this point. CDCH isn’t going to hire actual miners on the ground in Chile if there is an attempt at Caren production as Auryn has claimed there will be. So obviously that will be done with a contract mining company and the only thing that makes sense is to build on the work already done by Auryn potentially with Auryn being the working / mining arm of Cerro in Chile (many public mining companies that own properties make use of local contract mining companies for their labor just like they may rent much of their equipment from heavy equipment rental companies).

So beyond this, what else is there to “becoming public” in your view?

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20/20 hindsight is wonderful! MDMN was broke and AURYN was not mining with a cash flow. I think we got that! AURYN is doing what it can to move forward on the property:

These shares have a one-year restriction on them. AURYN will work with its shareholders to convert their AURYN stock to CDCH stock.
As the majority owner of Cerro, we look forward to working with current Cerro management. This includes the following:
• Creating a management team and Board of Directors suitable for an exploration company intent on becoming a junior and major mining company.
• Launching a massive exploration program on the Altos de Lipangue mining district including entering JV agreements with companies that have the specific expertise necessary for exploring and mining the variety of targets we believe we have in the district.
• Focusing our resources on becoming an active gold producer by reopening the Fortuna gold mine and actively exploring and mining the gold veins found in the Larissa tunnel.
• Subject to regulatory approval, consolidating the capital structure, changing the name of the company, and moving to a higher exchange or tier on the OTC.

From what I see, AURYN has completely outlined what it intends to do to bring liquidity back and restore what value it can to shareholders. All shareholders will have to wait until shares are unrestricted to allow promotion and news to begin again. Not singling out BE when I say, venting is one thing, complaining post after post is something else. Posters should realize that no shareholders are pleased with the events that have transpired over the years. If AURYN cannot do what it has set out to do we all lose here, so why keep beating the same dead horse?

Nobody is pointing any fingers at you. If they are, it’s a poor read on the situation. Not sure original holders in MDMN/CDCH will ever realize any value by the time the mountain is monetized but it’s better than a 100% guarantee of a 100% loss. However, the sooner shareholders understand the realities of this investment, the better. IMO, viewing AMC as a white knight isn’t exactly accurate either but those are the cards we’ve been dealt.

If you don’t mind addressing one question that’s been bothering me ever since the MDMN financials came out: Why has JJ been able to exercise his remaining preferreds? There’s 100% chance he took those shares and sold them into the market. He seems to be the only individual who’s managed to make a dime in MDMN yet, in my mind, he’s as culpable as Les. Thanks in advance.

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Easy. Unfortunately the horse I’ve been beating has been, for the most part, the right horse (or wrong depending on how you look at it). As events unfold (like the CDCH financials) I comment on them. When I disagree with statements made (we “got a great deal with AMC,” expect an IPO, there is pending news but it won’t be made until the shares are consolidated, etc, etc, etc) I express those views.

It’s becoming clear, even when I make a factual post (CDCH pro forma market cap = $50M) you feel the need to respond. I’m uncomfortably flattered but you’ll have some extra time on your hands to cut and paste previous posts or company PRs not worth the digital paper they’re printed on for many months. I’m going into hibernation until December.

I’ve never seen a share consolidation (reverse split) of 1000 to 1 but I guess that would be cool.

Maybe Auryn can pull off a JV. Common shareholders will be diluted (on the % ownership in the asset) into oblivion but, if we can negotiate some $$ up front there may be the possibility to monetize some of the smaller mines while the partner goes after the Alto, etc. This would be our best option by faaaar.

Maybe a stream could be negotiated but, in this market, it would be hard to envision.

Doc’s book on the MDMN saga: “Unicorns Without Wings” could make the NYTimes best seller list?

Easy. I’m relying on you to keep me informed until the end of the year.

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The preferred shares that were allowed to convert were the last of the preferred. According to the records, JJ obtained those shares recently by returning 20,000,000 common shares to the company in exchange for the preferred shares.

In order for the company to have denied the conversion, we would have had to have a court order. Getting one was cost prohibitive, and not guaranteed. Given that these were the last of the preferred shares on the books, we converted them and wrapped up the preferred issue.

20,000,000 over 3,000,000,000 was less than 2/3 of 1%. This amounted to less than $0.0000195 per share for each shareholder. I figured that was worth it to be done with the issue and not risk any possible legal shenanigans that JJ would try to pull on us in Chile because of the conversion denial.

PS @Baldy - I don’t think JJ is selling those shares into the market. He doesn’t have a lot of market savvy and will have trouble finding a broker in Chile who would take shares from him. jmo

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I recall numerous conversations about how a 1-2% NSR was the norm for Juniors when partnering. Even if we give up 3/4 to a major it seems that 6.25% ( MDMN ) and 1.25% ( CDCH ) equity positions is still favorable.

I think you summed it up. I believe HR posted something some time ago as well. I’m not involved so I don’t know exactly how it plays out.

At the end of the day though, I see CDCH being renamed, consolidated, and MDMN going bye-bye after it receives and distributes its shares in CDCH (or newly named company) prorata to the MDMN shareholders.

I don’t know how this will be done, i.e. special dividend, exchange, or some other mechanism. That will be up to management with input from the securities lawyers. I do know that it’s not easy to get anything like this passed FINRA these days.

Karl, fair or unfair, it really isn’t that difficult to understand. Shareholders in CDCH and MDMN had been cheated for years before AURYN entered the picture. Unfortunately, your bookkeeping example does not represent the reality of the situation.

Old management misrepresented things not only to shareholders, but also to AURYN. While AURYN may not be the white knight that many originally thought of it as. The fact of the matter is that in AUG 2016, both CDCH and MDMN were essentially completely broke, could not pay the taxes for claims they still had on record, and would have been a 100% loss to all shareholders had AURYN allowed both to fold. AURYN instead hosted an informational meeting and management in CDCH and MDMN was reorganized to salvage what it could during the past 2 years.

$21 cash and $1210 liabilities on the balance sheet speaks loudly. What is hidden is guidance from AURYN on the next phase of this investment. Unless things change, even though CDCH and MDMN are publicly traded companies, both will likely only report minimally required information. My expectation is that shareholders will have to wait until all CDCH shares become unrestricted to see what AURYN has planned to monetize and exploit the Caren and remaining claim areas. At least I don’t expect we’ll see a reverse split of 1000 to 1! A more realistic ratio might look more like a 70:1 reverse split for the trading shares and a restatement of the AS for 500M.

We still don’t know what Dr. Sillitoe’s evaluation revealed to AURYN’s management, but based on the last reports from progress on the Caren Adits #3 & #2, including the Larissa adit, I have confidence there is a plan to exploit this area with a positive cash flow. Will there be a time that AURYN buys back the claims from CDCH? I don’t think they can do that unless and until CDCH qualifies to move up to the OTCQX® or OTCQB® tier of OTC Markets. AURYN would likely have to have at least a year of audited financials before this could occur and meet certain other requirements.

Bottom line, this whole thing is F#%^ up, and without AURYN, we would be 100xF#%^ up.
My only recent mistake with this stock is I should have converted IRA to a Roth this month and not Jan
This is just a nightmare that is all my fault because I got suckered in with this board and all the BS.
Maybe one day I will wake up and a F#%^! ing miracle will have happened.
TDK
PS - MDMN to CDCH to whatever I am sure is the next F#%^! ing I will get.

God, please forgive me for this post.

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That’s a lot of F#%^! ing going on😂

I’ve come to the realization that I lost everything I invested here. Maybe one day I’ll wake up to Madman dream of this investment taking off. Lesson learned

Most shareholders have accepted responsibility for the decisions and mistakes made over the years in this investment. As WIZ said, it’s all water under the bridge at this point. If there’s one thing to be learned from the posts on this forum lately … get busy, busy with living!