Dangold, according to the prospectus (information circular), the consolidation requires 66 2/3% of the votes cast by shareholders to carry the management decision forward.
As well, any shareholders, who may prefer not to vote, give an automatic stamp of approval for management, as their lack of iniative, would be recorded, as a yes vote.
In any case, If insiders do indeed already hold 70% of the company's shares, the result will be forgone conclusion. But at least, it is important to let the company know that not everyone approves of their actions to continue to dilute their shareholder base.
One might think that this kind of dilution would also hurt the insider's financial positions as much as ours. And that would certainly make much sense.
So one might conclude that might make them roll back the share price by some smaller amount than 10 to 1.
Hopefully, they might wisely consider this as a more reasonable compromise if they have any real concern about supporting the retail investors who have backed them for so many years!
However, if they remain, self serving as their ultimate objective, they might gain the most financial benefit in their personal ownership of the company, by going for the 10 to 1 roll back and then hoping for a massive sell-off in the share price, back to some very lower price level, than the higher price that the roll back did produce.
Then, they would continue to make many more cheap, private placements, over a period of months or years, depending upon their ultimate time horizon.
That would allow them to continue to increase their proportionate ownership of the company before they would make any real attempt to monetize the company's assets.
If this indeed their ultimate object, then these insider actors are really, a very shady and deceptive crowd.
Unethical as word to describe them, could be construed in this context, as a most understated use of the term.
I do hope that these people are better than this!
But shady operators are always, what they appear to be!
And clearly that is what most of the market chooses to regard them to be. Why else are the company's shares priced so low?
I have asked myself, many a time, why didn't they drill the massive Talbot plate?
It makes no sense for a management which really was intent upon delivering the best of results for shareholders, by maximizing their company's share price, as quickly as possible.
That would already have permitted more private placements to fund further drilling, at much better prices and with much less share price dilution, than the retail investor has been forced to endure.
So we must come to one of two conclusions:
Either these managers are inept and stupid which means that they should all be fired!
Or they are shady operators with nefarious, selfish and self serving agendas.
Which should we choose to believe?
They have made no apparent attempt to drill at Talbot and with no public explanation as to why?
I would like to hear some legitimate and logical opposing view to my present opinion of the current Rockcliff management.
Anyone, please present an opposing view, if one, really does exist!
Certainly if they do not proceed quickly, in the manner that I have suggested, then I guess we will really know, what these people are really like!
I can't come to any other logical conclusion. I really don't believe that these, well educated financial minds are stupid!
Are they inept at their jobs? That is very possible.
Other equally educated and experienced persons, probably could do better! But they are not the majority shareholders! We are now stuck with these! They can't be fired!
Greenstone sits on the board because of their majority shareholder position. They may have that right but that doesn't make them smart or ethical in their decision making process.
The CEO is a geologist and a shareholder who wants to keep his job. He must obey the command of the majority ownership opinion, no matter whatever his personal opinion might be. If there is some corporate sleaze going on, he must hold his nose and look the other way!
If only management would be more transparent with their efforts to monetize their assets than just to say that these are difficult markets!
Who really believes that this is all that is going on, behind their closed doors?
Any more positive feed back would be most welcomely received!
I want to believe that I have invested better!
What do other people think?
Do we have any solution other than to sell?
But that would only lend advantage to their feeding frenzy!
When a piraya smells blood, it may well choose to chew, on our bleeding finger!
By selling into these persons' self serving agenda, then we may very well, lose a hand!
Perhaps it would be best, not to sell. Why let them, be the only winners?
Some will choose to stay the course, if only to regain the upper hand!
Just like the corporate insiders, some of the retail crowd, may also, continue to buy!
That might also become a logical option!
But most will wait for the roll back to minimize any potential loss!
Others who figure they are smarter, will buy in now!
Each to their own! I have made my choice!
All the best! Java