RE: The Big Question.......Hi Brumell,
You raise a good question!I felt exactly the same as you did when I saw the quick announcement of a financing before the ink was dry on the "Discovery Press Release".In an effort to get some questions about this matter answered to my satisfaction I contacted the company directly and was given the following very acceptable explanation by Mr. Riggs.
Dear Mr. Hynes,
Thank you for your comment. We have several legal agreements - with
Noranda and Aur. As part of the terms of the underlying option
agreement with Noranda, Alexis is required to place funding for exploration into a trust account or face default under the legal agreement. Current cash is not sufficient to make the next trust payment.
Alexis has been in discussion on the private placement for several
weeks with delays due to legal compliance issues of several interested
parties,TSX-V approvals for the financing etc. Noranda have been very
accommodating on delaying the Trust payment from the contractual date of March 31st to the end of April.
In the best interest of Alexis and our shareholders , we elected to go
ahead with the financing - requiring time to close this financing ahead of the revised trust payment deadline. It is this approach, or face a possibility of going into default on the option agreement and loosing all interest in the project.
The current financing will ensure that Alexis can vest fully in the
Noranda JV agreement. Timing has been difficult but the discovery news has been very timely, effectively very much reducing dilution to our current shareholders.
The Noranda properties have too much value to let slip though our
fingers,and certainly not while a discovery is in progress! We need to ensure we can vest. Rest assured there are other discoveries to be made on these properties over the next few years.
Best regards,
David Rigg
President
I wouldn't normally post direct comments from company officials, however, I feel it is the best interests of all shareholders that the accurate and true story be heard,
Len