The following Litigation disclosure was recorded as a directors warranty in connection with outstanding litigation. This was set out in the appendices of the Sandstorm agreement, filed on the public domain SEDAR site. The expiry date for decision could be delayed, acording to SEDAR. This could have been a contributory cause of a shareholder exodus. since this is a current issue, Mr Coffin should have known about the imminent conclusion of this claim.... ? and the potential for uncertainty. On the positive side, the disclosure does seem to ring fence the extent of litigations claims in relation to the 2009 accident.
It should not surprise a director that the market is confused, when direcors sign a committment to make a mine operation, at a cost of $35.4m, according to their own feasibility study, but they sign a contract to receive only $20m, when the contract included a GUARANTEE to repay $20m in six years. The directors have not explained that why they are certain to receive an additional $15.4m and at what cost, in order to achieve production. This sourcing of funding is a basic financing issue and the failure to inform the market may give the impression that the directors are running the company "on a wing and a prayer". Perhaps a more direct question to Mr Coffin is called for, which he seems to have sidestepped?
Source : SEDAR
SANDSTORM AGREEMENT
SCHEDULE "D" DISCLOSED LITIGATION
QUEBEC SUPERIOR COURT FILE 615-17-000467-109
PARTIES :-
ENTREPRENUUR MINIER MONTALI INC V RESSOURCES METANOR INC
CLAIM - £2,130,767.12 DAMAGES
FILED IN COURT 22 OCTOBER 2010
EXPIRY DATE TO ENSCRIBE THE CASE - 31 JANUARY 2011
