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Gold/Mining/Energy : Maxam Gold Corp. OBB:MXAM -- Ignore unavailable to you. Want to Upgrade?

To: Alex Balazs who wrote (8319)	5/14/1999 12:21:00 PM
From: Alan Vennix	Respond to of 11603

Things are heating up. Bid/ask now 0.31x0.34. A 57,000 share trade went through at 0.31, which appeared to be a sell at the bid rather than a cross between MM's. But that was followed by some buys with the last being at 0.34. Alan

To: Alex Balazs who wrote (8319)	5/14/1999 12:23:00 PM
From: Furry Otter	Read Replies (1) \| Respond to of 11603

Not to worry, a little rain makes the grass grow. <ggg> I agree that nobody would simply give $30 million away, esp. in a fledgling company using cutting edge technology, unless they had done intense due diligence and decided that the risks are outweighed by the potential rewards. Although we do not know the details, it appears that a major concessions by Maxam was to agree to provide metals to the funding company at a discount. This, of course, assumes (1) production will eventually occur, and (2) it will occur at costs that are reasonably low enough for Maxam to sell the metals at a discount, and stay in business. We have only sketchy details at this point, but we do know that stock is not being swapped for the funding, stock will only be used as collateral, which is good because (1) there is no dilution, and (2) the stock cannot be sold while it is used as collateral. Thus, 50 million shares are tied up for the foreseeable future. Also, the only property collateralized is that on Peoria 7--the vast remainder is unemcumbered. Note also that production is to commence by 2002--kinda far out there, but at least Dale has now given us a date certain to which he is contractually obligated. I agree that more info is needed to fully evaluate the effect of this funding agreement. I'm just happy that a deal has been struck, because without one, this company would be in limbo. I hope and expect that Dale will provide a little more detail at the AGM, even if no "final signings and filings" have been performed. Best regards, Otter

To: Alex Balazs who wrote (8319)	5/16/1999 3:39:00 PM
From: Larry Brubaker	Read Replies (1) \| Respond to of 11603

<<I'm a shareholder too, but it's time to be realistic and face facts, there is a catch, and when the market hears it (after the AGM) they'll make a decision as to invest or not.>> Alex, I have no doubt MXAM is giving away quite a bit to raise this $30 million. People don't give $30 million to a company worth $10 million (MXAM's approximate value before the announcement of the deal), and with no history of production, without exacting a heavy price. But without this deal, MXAM was going nowhere. Even if they've mortgaged their entire profits from the Peoria mines for 10 years, a working mine is still a great deal for MXAM. They had to get funding to build a mine. They have to build a mine and prove that it works to realize any value for shareholders. I'm sure, with this first financing, the terms are stiff. Once the concept is proven via a working 10,000 tpd mine, financing terms for the next 10 mines should be much more favorable.