7936567 Canada Inc SWYDF

RE:RE:RE:RE:RE:MD&A Excerpts re Financing

[mjl777]

I don't subscribe to the view that a j.v. would be the best option to advance Renard to production. The best option would be to bridge the required equity. This option would minimize dilution and maximize value for all shareholders. Unfortunately, it appears that this option is not even under consideration. Instead, the company is considering issuing cheap paper "in the context of the market", among other inferior financing options. Why would the company even consider issuing more paper at such a huge discount to underlying value? In any case, I think our discussion aptly illustrates just how bad the decision to purchase the Quebec government's'interest in the project was. Stornoway would have been much better off letting the Quebec government finance their own share of the project, rather than hanging on the coattails of other shareholders, which is what they have essentially done. With a J.V., we will end up with the equivalent of almost twice the dilution, possibly more. IQ is our "j.v. partner" and IMO it's time they step up to the plate.