RE: RE: RE: RE: This is a big blow Here is a portion of the Jan 17 NR where it was announced that the Tullum deal is off:
On December 17, 2012 Monument announced a best-efforts private placement financing through a syndicate of agents led by Mackie Research Capital Corporation and including Salman Partners Inc. (the "December 17 financing"). This financing is intended to fund the Mengapur development plan that Monument believes will add significant value to the Company as it pursues its strategy of becoming a mid-tier gold and metals producer.
The December 17 financing is proposed to be completed on considerably better terms, and with less dilution to existing shareholders than the previously contemplated private placements with Tulum Corporation ("Tulum").
In addition, Monument believes the December 17 financing is more attractive than the proposed private placement with Tulum announced on October 11, 2012 as it will provide for broader participation by existing shareholders and potential new investors, as well as enhance Monument's profile in the capital markets and give Monument enhanced access to, and credibility with, institutional investors.
Further, Monument expects that the December 17 financing will pose limited execution or regulatory risk, whereas the earlier placement contemplated with Tulum announced in October 2011 was withdrawn in August 2012 in response to issues raised by the TSX Venture Exchange.
Accordingly, the Company has decided not to pursue the proposed $23.4 million private placement with Tulum, which was announced in October 2012. The terms of the December 17 financing were approved in principle by Monument's Board of Directors on October 9, 2012
Now, here we are just 5 weeks after that announcement and MMY rolls over and pays a $12 million settlement for a lawsuit that was never even reported. That has to be a world record pace for a settlement of that size. Consider that it takes a while for the attorneys to prepare such a lawsuit, then it has to be filed with the court and then Monument is allowed adequate time to respond. That would normally take a few months just to get to that point. Another thing that is very odd is that I am pretty certain that Monument would carry professional liability insurance on itself and its officers. That is also known as errors and omission insurance. With that, MMY would certainly get the insurance company involved as the E&O insurance would likely cover a large chunk of any settlement and the legal costs. Most of these cases drag on for a l-o-n-g time. It often takes a year or more to even get a court date. Typically, nothing happens until just before the court date and then the parties get serious about settling. Perhaps there is an attorney or someone out there who could provide more details on the civil suit process in Canada but I don't think my description is too far off.
IMO, this rush to a huge settlement is crazy and something really stinks here.