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Gold/Mining/Energy : Caribgold- CG:TSE

CG 56.58

-1.7%

Oct 30 3:59 PM EDT

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To: John Fairchild who wrote (2)	3/5/1998 10:24:00 PM
From: John Fairchild	of 48

Copied from the thread I started which has now been deleted? Cash rich junior in Alberta diamond play. Third quarter results (Oct 31, 97). $7,340,000 cash with 10.5 million shares issued. Cuban property 100 sq miles with 300k oz gold discovery - no longer appears to be a focus. Current JV's ------------------------------------------------------------------------------------------------------------ Marum - 50% interest in 250k acre property (you all know where). CG is the operator and are currently drilling. To earn the 50% interest they must spend $1.5 mil and issue 200k shares to MMU. To earn the first 25% CG must spend $500k and issue 100k shares to MMU by Dec 31, 98. Also CG must subscribe for a 1.25 mil MMU private placement unit made up of 1.25 mil shares @ $0.18 and 1.25 mil purchase warrant equivalent to 1 share per warrent @ $0.25. Running total of cash position assuming first year expenditures plus exersize of warrants. $6.8 mil with 10.6 mil shares out plus ownership of 2.5 mil shares of MMU. ------------------------------------------------------------------------------------------------------------- JV with PUG 50/50 on 625k acres in Sask (originally staked as 50/50 with Cayo) ------------------------------------------------------------------------------------------------------------- JV with PUG and Reclamation 1.4 mil hectares in Lethbridge Property (South Alberta) preparing to drill. To earn 25% interest CG makes cash payment of $125k year 1 and $125k year 2. Spend $1 mil in two years with $500k in first 6 months (by end of April). Further increase by another 15% by year 4 by spending $2 mil and issuing 100k shares. Assuming the first 2 year commitments are meet the cost to CG would be $1.25 mil. The new running total of total cash position would be $5,550,000 after first year spending commitments with MMU and second year with PUG/Reclamation JV's. Plus as stated earlier total shares at 10.6 mil plus ownership of 2.5 mil MMU shares. Value of MMU shares @ $0.3 = $750k Cash value of CG after above commitments are meet = $0.595/share Obviously there is going to be some additional burn but I expect that cash is making some decent interest income ($300k in 9 months reported in third quarter report) Almost forgot. They also have subscribed for a 600k special warrant with Goldeneye. No announcement of being exercized or at what cost. If it is exercized the each special warrant equals 1 share + 1 warrant for 1 share representing 30% of Goldeneye. It currently trades at $0.25. Closed today @ $0.63. Looks like good upside (soon!) with downside protected by cash position.

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