RE: Financing - warrants >>>i find it hard to believe that a gold producer could not call the shots in a financing deal<<<
.
REALLY? Why don't you loan them the $20MM on whatever terms they ask?
CRJ has ONE source of revenue - ONE. The banks don't like to loan money to single mine companies, because...if an "OH Sh *T!" happens [Mother Nature throws a spanner in the works] and the mine is shut down or production severely curtailed... Then what happens to CRJ's ability to repay??? ....and the bank has to look at the real possibility of owning the mine. THAT makes loaning money to CRJ a higher risk proposition than another company with two or three sources of income.
.
>>>were not dealing with an exploration co here even though the share price reflects that .<<<
.
No, but we are dealing with a company with ONE mine and who can't repay the note due in March. Without the new loan CRJ will have to default on its loan - do you know what was pledged against the loan? So in essence, without enough cash to pay, CRJ is in a liquidity pinch. People backed into the corner don't get favorable reviews from the market, nor favorable treatment from lenders.
.
>>>>CRJ best move would be to cut down on all costs and focus on mining gold .<<<
.
NOW you are thinking! But the problem is that if CRJ abandons all efforts on the Madsen Project, more investors will walk away. It is the promise of of a "big" hit at Madsen that has many hanging on to this stock. But alas, even if CRJ just focused on mining at Seabee, unless they high grade the mine, they aren't going to have enough cash to upgrade the Mill to be able to run 100K opy.
.
But with a note coming due in March 2013, one has to wonder why CRJ didn't focus on mining and debt repayment in 2012, rather than exploration and acquisitions? For guys that pride them self on "hanging on" they sure messed up. What happens to CRJ if the USA goes over the fiscal cliff and banks seize up lending? That sure looks like it has a default scenario in there....
.
So that could be what risk adverse, Pro Money is looking at with CRJ? Now I know thinking like this is just OTT - since everyone knows things like defaults or mine problems can never happen.