Eco Oro Minerals Corp C.EOM

Also Sept 30 Management’s Discussion and Analysis is out

[sailor8]

check out: [url=Management’s Discussion and Analysis]Management’s Discussion and Analysis[/url]

A Tit Bit copied and pasted:
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...The Company is seeking US$696 million plus interest at a rate of 6.6 percent per annum, compounded semi-annually, as compensation for damages the Company sustained as a result of Colombia’s measures. The Company has not recorded any amount in the financial statements as a contingent gain due to the ultimate uncertainty of the outcome.

OUTLOOK

Notwithstanding the continuation of the ICSID Arbitration, the Company remains open to engagement with the Colombian authorities in order to achieve an amicable resolution of the dispute.

In the meantime, the Company’s immediate plans for the ensuing year are as follows:

• to advance the ICSID Arbitration;

• to continue to assess the Company’s activities, including monetization of certain of the Company’s assets (including the potential disposition of assets, plant and equipment acquired for the Project) and cost-reduction to support the preservation of its core assets and rights, in an effort to mitigate losses;

• to carefully manage its cash resources;

• to continue to assess the Company’s mining titles and related ongoing regulatory requirements; and

• the protection of its rights and interests in Colombia....
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[sailor8]

Does anyone has better knowledge than me in finance mathematics: what would be the total sum until now of  "US$696 million plus interest at a rate of 6.6 percent per annum, compounded semi-annually, ? Asuming the damage occured to us In August 2016. ----- (In reality the damage occured even earlier due to unclear Colombian positions published before August 2016)

[NaturalCurrency]

Someone should double check, but I am getting about $1.7B

[NaturalCurrency]

Sorry, made an error in the earlier calc, should be about $1.15B 

[TiredofWating]

Yes, about $1.15B USD or $1.5B CAD.  10% goes to shareholders or $150,000,000 CAD.    Divde by 100,000,000 shares. $1.50 CAD per share....

[sailor8]

I sit in Europe. For me Canadian legal financial language is difficult to be translated into clear text. How is the way to 10 %  for shareholders (from potentially up to  around 1.15 B US$) ? Under paragraph 4 + 6 they wrote: 4) to the Company, US$30,000,000... 6) to the Company, the balance (if any) of the Claims Proceeds. Accordingly, the Company will not be entitled to retain

[TiredofWating]

We don't understand it either!!!   The distribution waterfall remains confusing.  However, from past statements, one interpretation (and this may be wrong), is that 90% of any claim goes to the CVRs.  Another 5% goes to directors, company, etc. etc.  Leaving only 5-10% for the remaining shareholders. But, as with everything associated with this company, I have no idea

[rdpsims]

God help us and please bring an end to this 15 year suffering for us all since Greystar

[notafinger]

Apparently we will know something by DEC 15th with regards to delimitation....like we haven't heard that before. IN VEINS! @susanamuhamad carried out a dialogue exercise with the inhabitants of the highest municipality in Colombia. Likewise, he toured one of the mines where he confirmed how ancestral mining is carried out and promised to provide a solution before December 15. #Delimitacin

[MacBook]

I believe Aris was scheduled to table its EIA plan this week This could get messy again. glta

[NaturalCurrency]

Well. Dec 15th is almost here. Soon we will know. Resolution or another dead end. 

[TiredofWating]

Maybe Friday after the market closes.....  

[sailor8]

Just only a plain theoretical thought. Shares out = 106.15 million. And our compenstaion claim sum including interest  payments is something around 1.15 Billion US $... ---------------------------- There are two major shareholders: Amber Capital LP, on behalf of one or more of the funds or other discretionary client accounts managed by it 20,348,508 ----19% Paulson & Co. Inc. 12,177,835

[Donald1]

Won't the CVR's  and debt eat up  almost 90% of the settlement?

[Baboos]

it's a pathetic sad situation, to see so many invested in this company...I sincerely hope this ends up at least in somewhat a positive ending for the longs

[rdpsims]

Honestly I'm kicking myself for "investing" in Colombia. A drug infested corrupt leftist craphole. sad that all that money is gone really.

[TiredofWating]

Agreed.  Years ago now the Colombians were at PDAC encouraging investors.  We invested, found gold, and the Colombians then changed the rules to take it away.... 

[TiredofWating]

Yes.  ISCID settlement would leave 5-10% for common shares.  

[Loiscast]

That is quite accurate but much closer to 10%. Any debt is proportionate to the CVRs which cover 90% of any debt or expense.....I believe!

[MacBook]

from md&a Following completion of the 2019 Private Placement, the terms of such securities provided that the proceeds from the ICSID Arbitration (“Claim Proceeds”) would be distributed in the following order of priority (in each case to the extent that the amount of Claim Proceeds is sufficient): 1.in full repayment of any accrued and unpaid default interest, fees, expenses or

[oldtimer42]

Interesting that they do not identify the percentages of the distributions....except for the UP TO 5% of the proceeds to management that could be as much as 35 to 45 $million. That would need to be voted on.

[MacBook]

The point I was trying to make is the cvr component is capped at $460M Assuming full $675M win : It's easier to back into equity porpotion based on the payment order CVR (up to 460M) + notes and loans + mgt bonus  + maybe some legal  ... rest to equity holders. glta

[oldtimer42]

Based on the distribution, the CVRs get a gross of 90% of the award, the max for shareholders is 10%. No doubt the board has no idea the actual amount of the award so the $460 million is probably a conservative estimate. It is very unclear how they arrived at that amount, why they sent that out with so little detail is confusing.

[TiredofWating]

Agreed.  10% is the MAX for shareholders.  After additional fees, distributions, expenses are subtracted, it will be closer to 5%. Perhaps the better outcome would be for Colombia to allow the development to take place and for Minesa to buyout EOM.  Colombia could avoid paying the settlement, Minesa would get the mine, EOM shareholders would be paid out.

[MacBook]

...what's the breakdown?

[oldtimer42]

There is no breakdown, the board will not be able to give us that until we have (a) an arbitration award or (b) a buyout. I have no idea why they put out this last message, it only adds to the confusion.  Tiredofwaiting is usually right on but I disagree with his point that the 10% allocated to shares will be reduced to 5% by bills, debts etc. That would mean that proportionally the CVR

[MacBook]

assuming 675M payout  2025 settlement $460M cvr and mip $34m notes loans assume award would include colombia payment for EOM legal fees

[TiredofWating]

Yikes....  You see this draggin' on until 2025?   

[MacBook]

2025 to estimate loan interest

[zubry]

How do they plan to keeps the lights on that long?

[TiredofWating]

In the meantime, the Company’s immediate plans for the ensuing year are as follows: • to advance the ICSID Arbitration; Okay, here is my question:  How? How specifically does EOM "advance the ICSID Arbitration?"   Colombia can simply ignore the ruling.  There appears to be no mechanism to enforce the ruling.  Its been two years.  What will change in

[oldtimer42]

Well Tired, any country that refuses to pay up becomes a pariah internationally by not complying with an international agreement pursuant to ICSID decisions. The good news is that 75% of countries that lose arbitrations pay up. The ICSID has been hoping for a negotiated settlement between Colombia and EOM. Obviously that ship sailed long ago. But Aris involvement in the neighborhood adds the

[TiredofWating]

Listen, I am on your side in the hopes of a negotiated setttlement.  Its just that I am increasingly less convinced of the argument that Colombia would become a pariah for international investors.  They will simply argue that they were "protecting" the environment and communities, to which investors will say "great that satisfies our ESG committments!!!"