American Bonanza Gold Corp ABGFF

RE:RE:Keep your cool and look at....

[Ranger56]

No doubt extensive dilution. And yes this is yet another example of mismanagement from a junior micro cap to let things come to the point of having to  raise cash at 5 cents. A common management error in the junior space to allow themselves to get trapped. I have told many to do your financing early when the stock price is much higher and get war chest of capital with lots of contingency to get to postive cash flow without ever having to come back to the market. But so many simply fail to do so, and BZA is a good example. That said, your right, short term they are just targeting share issue of 100M for $5M. Also, we are where we are now and the only good news out of this is for new investors is this financial mismanagement has created a compelling buying opportunity. The fact is operationally they have traction now-- increasing production consistently every month and near break even. This means cash burn stops in the next month or 2. Cash flow will be very positive in 6 months to a year if they continue to execute. Therefore they should not need to come back to the markets for more cash. The only exception will be much latter when the share price is much higher and they either make an acquisition or embark on a major expansion. The dilutive effect means a little longer for cash flow to reach 1 cent a share and then 2 cents a share etc.. thats all. So financially they really screwed up but operationally they are doing much better.