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Gold/Mining/Energy : Millstream Mines (MLSM) -- Ignore unavailable to you. Want to Upgrade?

To: William F. Post who wrote (190)	8/27/1999 3:04:00 PM
From: Morag	Respond to of 664

William I can't help you out too much there, other than as I understand it, HDG will get a % for every $133,000 they spend on the project. This % is then convertable to MLSM shares at the end of the agreement. Based on the current agreement their break even point is 50 cents. I would suspect that they would want to do more than break even. On the other hand I don't think it matters too much to them what the price is right now. As to investor sentiment regarding the agreement - and the recent sag in share value, my guess is that was already factored in after the announcement and through June - not now. More to the point is the lack of news and the fact that they have not been drilling for the past week or longer - that would have a larger impact on the current pricing in my view.

To: William F. Post who wrote (190)	8/27/1999 6:19:00 PM
From: Brumell	Read Replies (1) \| Respond to of 664

Hi William, I think Morag answered your question well regarding dilution from HDG financing and it's impact on the market. At this point there shouldn't be any impact. However, now that we are scraping bottom, maybe it's time to be candid and lay out the cards. What's killed this stock has been 1. lack of news and 2. over supply of stock. The supply of stock came from financings completed over 18 months ago and I'll be specific: Nov.3, 1997 - 600,000 shares, Dec. 15th 1997 - 450,000 shares, Dec. 15th, 1997 - 3,213,200 shares and Jan. 1998 - 1,000,000 shares. That's a lot of stock but there was an 18 month hold period attached to it. Consequently, this stock started to become free for trading in May of this year with the majority free for trading in June. The figures are from Sedar. Surprisingly, and despite heavy trading in June, MLSM withstood the onslaught and in fact rallied at one point. The reason again was simple - people were looking forward to an aggressive exploration and drilling program thought to be getting underway. Unfortunately, and for whatever reasons we care to speculate, the operators chose to be secretive and withhold information. After announcing that a program would commence last May, we heard nothing except for a minor news release in early July, until last week's mediocre and inconclusive results. I don't know if the operators wanted to sink the stock but they couldn't have done it better if they tried. So now we are in the swamps with some cheap stock around. Wish I could see who's picking it up but I can't. As Morag has also posted, looks like drilling is also about to resume and the signs now point to a big campaign. They have a lot of catching up to do. My hunch is we are soon going to see some trading volume followed by drilling announcements and a return to positive market momentum. Regards, Bob