Just a FYI, what AMC/MDMN’s end product is a concentrate. They shipped the concentrate to the refiner that refines it to dore bars. AMC/MDMN gets paid from the refiner for the quanity of gold and yes all these rat bastard refiners skim a little. Generally, the refiner will pay you less than spot so they can make a profit in adddition to their skim. So if gold is $1,200, you get paid $1050 to $1,100 per oz au.
AMC/MDMN would then pay a the NSR (say 2%) of the amount received from the refiner. So yes, 15% equity is far different from NSR. OK, beat that horse enough.
Just another FYI, here is link to a video (first video) that shows how surface mining is set up and done. Part way through the video, you will see the charcoal concentrate that is sent to the refiner. The end photos of pouring gold is done in their testing lab as sampling.
Please note that this company has to run its material through two circuits to grind it almost to sand and us aglomeration. That would not be necessary at the Caren.
Its amazing what a couple thousand dollars of normal open market can do to the downward pressure compared to a million dollars in a fixed behind the curtain sale on upward pressure
Anyone who doesn’t believe there is an enormous short position on this stock will be surprised if a cash dividend is issued. IMO
For many years we have had two sides in management!
One side was very self serving and could care less about shareholders!
The other side is exactly why we are still alive as a company and looking forward to the best of what was a very bad situation.
Overall a very big pain in the rear for everyone of us including myself!
Can’t at all complain about the anxiety of all shareholders, because it has been hell getting to this point.
I’ve lost two investor friends to cancer and another in very bad condition while we wait for this to transpire.
We are now 95% looking into a new life cycle for Medinah and I’m quite pleased with the current direction of the company.
Still a little clean up required, but nothing compared to where we were a short time ago!
Consider also the fact that background rumors reputedly from Les indicate that “equity” might not mean what we think it means and that MDMN will not have to “pay” for any mining infrastructure costs.
I think that’s true. We will be a shareholder in AMC. Shareholders do not pay for expenses. The company does.
If Medinah, in which you own shares, built a mine at the ADL Breccia, would you as a shareholder expect to “pay for mining infrastructure”? Would you have to write a new check to pay your fair share? No.
But those expenses one way or another come out of profits (directly, via debt, via dilution, etc). Therefore profits per share are less and so 15% is either less than 15% at the end of the day else it is just 15% of less. It is Less. (not Les)
So I would suggest Les’ rumors on that topic are in the strictest sense true, but they do not mean what you are taking them to mean. And that is Les’ art form. It is also taking the ADL contract at face value of what the text says without relying on any other undocumented hopefuls.
BTW - I was also the one who pointed out the reference to “Appendices” within the ADL contract. And these “appendices” have not been published. So I do not deny there are other documents somewhere that discuss something. But they do not fundamentally alter what the ADL contract states, else they would not be appendices to the same contract signed simultaneously with that contract. But that’s my non-law school IMO.
Once again another missing piece to our puzzle. Is out 15% equity interest simply straight equity interest, or not. My guess that until Auryn exercise the purchase option MDMN does not have capital contribution requirements. I also believe that Auryn will be public before the option is exercised and we will get 15% of the public company stock. The next piece is whether our 15% could be diluted or not, based on Auryn’s future capital needs. If the outstanding common stock remains fixed and all future financing is done via preferred stock( non convertible) and debt financing (non- convertible) our 15 % could remain undiluted. But if they do convertible debt or equity financing then our equity interest becomes dilutive unless there is a clause that MDMN always maintain 15% equity interest, which I doubt. But we must also realized that Auryn equity in their own company becomes dilutive as well unless they always buy equally into any dilutive financing in order to maintain their equity interest.
The other missing piece of the puzzle of course is what does 15% mean. Does it mean 15% FCI, or 15% straight equity interest or something inbetween. I leave that to whatever you like to believe, my thought is it is probably straight equity interest, but it could be something in-between as well. . JMO
Being a tax professional, I also know that partnerships may be structured in any number of ways. For example, a partner’s distributive share could be simply his percentage of net profit. It could also be a percentage of the GROSS earnings (before expenses). Admittedly, Auryn is a Chilean partnership, so once again we do not know exactly how it is structured. As you say, we can make “educated” guesses, but at the end of the day we still do not know. From my perspective, since I believe we have had reputable counsel, I believe we are well taken care of - but remain anxious to learn the actual “deal”.
Maybe yes, maybe no, but It should be fairly close, and it makes a significant difference in valuing the 15% since it will be determined by the market! JMO
The contract is clear. Why do people invent things that are not there? Just read the contract.
Forget these pie-in-the-sky dreams that make no sense in the real world. NOBODY is giving anyone 15% of the entire AMC owned ADL with a perpetual non-dilutable interest.
There will be cash calls. We will have to come up with the cash or be diluted. If it’s common stock of a public company we’ll suffer the same dilution any other common shareholder would suffer. AMC is not going to be giving MDMN some special non-dilutable interest. There is no free ride here.
Read section 5 of the contract on page 14.
We turn over 100% of the rights to all the properties. AMC pays us $100 million dollars and 15% of the shares of AMC SPA.
The reason I bring it up is that it makes me think of Masglas (AMC’s parent company). Essentially their self-description value-add is as a ‘consolidator’ for the majors. They find, consolidate, explore properties, get to formal resources and then sell in part or whole. They just did a deal with subsidiary of Pan American Silver (a silver major) with a “purchase Option” for Kootenay’s flagship property: 75% ownership for $8M in cash and $8M in exploration expenses. Their idea is to do the work now and then turn about and sell when the majors must buy as the market turns and they need to replenish reserves.
It sounds quite familiar.
In this mental model AMC is one subsidiary of the parent and the ADL is the flagship property being consolidated along with other properties Masglas has already publicly mentioned.
The cash from early production enables them to 1. pay the ADL option, 2. fund exploration and increase value of the property, 3. potentially fund further Masglas acquisition and exploration and thus expand their consolidator role and increase value in their company.
In this model, Masglas is the company that would go public like Kootenay. And Maurizio Cordova is James M. McDonald.
Medinah US would own 100% of MMC which would own 15% of AMC with the other 85% owned by Masglas (and friends) (15 / 85 ratio subject to change but the idea is what is important here). Medinah would have no direct relationship with Masglas other than as shareholders in the same company (AMC).
We definitely have a good start on this entire process. But there is still a lot of work ahead of us (Auryn). I would love to see Auryn exercise the purchase option agreement by this April. But I’m not so sure that Auryn wouldn’t want to wait till the next round of drilling and assay results are back before making that big move. I think the more Auryn learns about the Mountain, the better for us, and the better educated Auryn is to make their decisions going forward, which is certainly a benefit for Auryn.
And remember Auryn still owns nothing, zero, of the ADL until they exercise their purchase option. So let them keep spending money to prove up, explore, the Mountain. That is a completely free service MDMN is receiving at the present.