Wow.
RocksTar is now 0 for 3.
There clearly has to be "something" else going on...
In my prior posts I said we'd probably never be able to learn what was behind it, driving it. But, I think the odds of there being a legal action go up pretty significantly, now... as you see more victims piling up. It's inconceivable that the wheels coming off, in remarkably similar fashion, and at almost the same time... in a number of deals... would be unrelated.
At this point... it looks like TLR, Calico and Seabridge... and their shareholders... probably share a common cause of action ? So, if nothing like that happens... even that should tell you something. And, if something does... we'll learn more. Given these are all publicly traded companies, with obligations to shareholders, and issues to address with compliance with exchange rules, regulations, and regulators concerns... I think the odds of legal action are increased, because it is pretty clear that the failure by RocksTar to meet its obligations DID have obvious impact on the shareholders of three different public companies.
If nothing else, the repetition in the pattern seems likely to attract agency interest...
Clearly, it should... when you see a pattern in frauds being practiced against listed companies...
While I'm not a Wheeler fan... not ready to give him a pass... find his past associations troubling... things are so ill defined relative to the range in potential, that I'd not read into it yet that the events we see require that Wheeler is the only potential source of problems, and a knowing perp... rather than potentially, somehow, perhaps being made an unwitting victim himself. But, clearly his name is out front. It could well mean that I was right in my first analysis, re Wheeler not being "a detail guy"... and something important got over-looked. That doesn't mean he wasn't (and, may still be) getting paid for his time, and the use of his name... while others were responsible for the financing, any maybe were even intending this result. But, it does appear, at a minimum, that either the money wasn't there as expected for some reason, or, the source of "the money" got cold feet... while the detail work necessary to make sure it could be depended upon to be there and make things happen as planned... didn't happen. It's possible that Wheeler got stabbed in the back by others... exploiting that known weakness ? Or, he was carrying others water as they went about trying to create "trading opportunities"... to exploit at the bottom of the market ?
Over-promising clearly happened. You have to assume that must have occurred based on an assumption the money was there, when it wasn't as there as it was assumed to be, based on Wheeler's assurances ? We just don't know who it was that over-promised in terms of what to whom... what assurances existed... or who was responsible for creating the conditions that resulted in the obvious under-delivery ? But, there are three separate public companies involved, each of which has experienced people looking after their interests... and, RocksTar makes four groups of "experts". These guys are not industry neophytes, at TLR and Seabridge, at least... nor, is Wheeler... and they have obligations to perform, they do know what they're doing, and they pay lawyers and accountants for doing basic due diligence in those areas beyond the limits of their own expertise ?
Somehow, something got missed... by all of them... ?
I don't think you get to the answers... without knowing whose money it was behind the promises... and what happened that generated the no show.
Was the money ever really there ?
TLR and Calico... probably aren't going to be leading a charge to the courtroom.
Seabridge is who I'd watch...
But, also note, there was more of a cost involved for RocksTar in the Calico deal: "In its news release of today, Calico reports that it has not received from Rockstar Resources Inc. the required second down payment under the memorandum of agreement dated Dec. 2, 2013. As a result, Calico reports that it has delivered to Rockstar Resources a written notice of default advising, amongst other things, that Rockstar's right to purchase Calico USA has come to an end and the initial down payment has become non-refundable and will be retained by Calico." seabridgegold.net
The posting at Stockhouse... stockhouse.com notes that the Grassy Mountain property was considered grossly undervalued at $20 million, the deal that was being made was valuing it at $30 million... and following the news, and the stock being slaughtered, the share price there now gives it a marketcap of only $6 million ?
So... "cold feet" might be very easily explained in a few different ways...
Maybe you called it right, and it was Wheeler's own money that was as risk... a bad trade (or some other detail that was overlooked) meant the leverage expected to be there... couldn't be applied as intended ?
I think it more likely he was working a deal to benefit himself while using other people's money to do it... rather than putting his own at risk. There's nothing wrong with being the entrepreneurial intermediary in brokering deals that benefit you, unless you already owe a fiduciary responsibility to others that precludes the legitimacy of that benefit. That also defining the problem apparent in the same pattern as dominated his career at CDE... explaining how his "success" there benefited himself, and the banks... but not shareholders.
RocksTar fronting for others in doing a "going private" deal... might mean they were only brokering a deal for... ??? Someone perhaps didn't like the % Wheeler was carving out... figured out they were over-paying for the agency of a middle-man...
Or, "the money" was simply trying to time a deal done at the bottom in the market while putting ink into generating leverage that would enable carrying their trade risk as deal risk that would be held by others ?
Or, perhaps there was a plan that is succeeding, as was intended, in manipulating the valuation through the operation of the market functions... generated by the (planned) failures ?
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