King River Resources Ltd T.KRR.W

RE:RE:KRR needs to provide 10 million $ AUS of shares

[Farquar]

TheLandedEagles wrote: Do you really believe the CEO alone really wanted this purchase structure , it was part of the on going negotiated....and I believe the seller wanted to retain an equity interest in Karora for the long term potential based on the future upside in this company and as to why, we are all here today and invested in Karora.  they wanted that equity investment of some size. CEO probably wanted an out right cash purchase...in my opinion. That 1.9mm share dilution is non material in the overall picture in my opinion. it was necessary, they probably wanted less cash and more equity... I know I would....If karora shares do go back to all time highs, which I believe they will once GOLD goes over $2000 dollars. They will have greatly profited and will be rewarded generiously by trippling that equity postion in the very near future. Just like all us ... thats why we are invested.....make sense now, right. These terms are very common in most cases, and companies try to retain an equity position if they like what they see...in this case they like and believe CEO and thats why they sold this mill to Karora...and the best way for them to profit more on that mill and could do it with Karora purchases it under these terms....my opinion on this...best deal for all concerned...

I don't think you understand my point...Krr owes 8.87 million canadian dollars worth of shares to Lakewood co....The price per share is 4.45 canadian dollars per share for 1.93 million shares.. So KRR needs to issue 1.93 million shares to Lakewood...but the thing is , those 1.93 million shares are now only worth 6.1 million dollars canadian..Lakewood's 9 million $ cdn of shares are now worth only 6 million cdn..Lakewood has lost 3 million $ canadian already...Wouldn't it be better for them to take the 9 million $ canadian in cash right now instead of the 1.93 million shares? That 9 million $ cdn could buy them almost 3 million shares instead of 1.93 million , that's if the price of KRR stays in the 3.00 range for a while....Everybody would win, as KRR would avoid creating 1.93 million shares which would be dilutive and Lakewood would have their 10 million Australian dollars instead of their 6.75 million $ australian worth of KRR shares....Maybe KRR could arrange for Lakewood to get their shares from somewhere....Do you understand what I 'm saying? Lakewood could still get shares in KRR but much more than the deal calls for....KRR has 70 million cash+ 69 million cash from the BD and has 80 million cash from the new credit facility...That's almost 220 million $$$ cdn...Of course they would then use up 72 million $ cdn for the purchase of the mill....My point is that KRR would be better off using all cash for the mill buy-out... The non issuing of more shares by KRR is the better way...Krr does not need to issue more shares...