via NowAndFutures.com - Gold Miners

What will happen in an equity decline? Very likely gold miners and gold prices will trade places with declining equities. That gold miners have advanced sufficiently and gold prices remain above the psychological threshold of $1300/oz. US, is enough of a start to convince equity traders out of their declining equities that the gold space offers a liquid vehicle to trade in if there are no other available strategies.

There is a strong analogy in the 2002-2004 period. This period did not see the strongest advance compared to the 2008-2011 period, because there was still the belief that capital gains were to be had by holding bullion.

Though people might argue the insurance benefit of holding gold, they really mean capital gains in the event of a near total collapse. Well, I ask you, where's my total collapse, dude?

http://www.nowandfutures.com/images/gold_xau_hui_bgmi_sp_500_long.png

CRC-ARC.GC.CA - Up Is Down

So far we haven't seen what is intended for the emergence of Golden Band after restructuring under the BIA. There may be another possibility under corporate law. The company, for its part, hides Canadian corporate law terminology under American corporate law terms, and vice-versa, but the Canadian law will apply.

First, the terms used in the news releases during the BIA proceeding need to be clarified. The one thing that needs to be considered is whether a change in control has occurred.

https://www.divestopedia.com/definition/4746/change-of-control

The company issued what is called a change-in-control put to PROCON. But under the BIA, it was called a 'Stalking Horse Credit Bid'. That means the company issued a security interest to PROCON. It is an OPTION to be used in the process of a plan of arrangement. Or perhaps it's known as a redeemable security.

http://www.businessdictionary.com/definition/security-interest.html

This would prepare the company as a target corporation in a reverse triangular merger in American terms.

http://www.investopedia.com/terms/r/rtm.asp

What that is considered in Canadian corporate law is simply an amalgamation. MiningFinance Law updates us on the process of a friendly plan of arrangement where the target corporation is amalgamated into the subsidiary of the parent.

http://miningfinancelaw.com/2014/03/acquisition-transactions-plans-of-arrangements-versus-take-over-bids

The company states the shares would be retracted, cancelled and extiguished means that minority shareholders would be squeezed out of their positions by selling their shares before an impending bankruptcy, which would be then cancelled, whereupon the amalgamation would then take place, and under Canadian law, the shares would then be disposed of,(rather than extiguished), called a disposition.

What makes you a beneficial shareholder under the circumstances is whether you bought into the company at least 60 days before coming under the BIA,(technically 60 days before the change-in-control put was issued to PROCON) as is pointed out by the OSC in section 1.8 of NI 64-104.

http://www.osc.gov.on.ca/en/SecuritiesLaw_ni_20160505_62-104_take-over-bids.htm

MI 61-101 goes through the protection of minority security holders in special transactions, or in this case, an amalgamation. You would not want to be a dissenting minority shareholder in Golden Band at this point at all, because there is a likely hood that you could be cashed out. You would have bought sufficiently during the no-bid period from November 2014 - February 2016, in order to ride out any predations, such as a 30:1 reverse split.

You would have voted in favour of the company special resolutions placing you in the majority.

The full body of what might be accomplished by the company and its amalgamating business partners is practically contained in the Canadian tax law regarding amalgamations:

http://www.cra-arc.gc.ca/tx/tchncl/ncmtx/fls/s4/f7/s4-f7-c1-eng.html

Conclusion: The company will likely amalgamate with another company as part of its emergence from the pro-forma insolvency. What the company brings with it is the property with extensive world class gold deposits AND the Cost Of Capital.

What the amalgamating entity will bring to the table is the asset-based financing tranche(which is really Golden Band's)which is equivalent to the cost of capital, and the facilitation of a tax-advantaged strategy for all parties to, once again, become a publicly traded company.

More than likely Sprott would have created a private entity as a subsidiary in the event of an amalgamation with Golden Band, Trancheco. But Trancheco would first be IPO'd as a Special Purpose Amalgamating Corporation, or SPAM. It is the private entity SPAMco that would make use of the Offering Memorandum.

via Financial Post - Asssessing SPAC Deals.

The special purpose acquisition corporation is examined here by Barry Critchley.

Very likely this type of strategy will be used in the amalgamation of Golen Band with the SPAM. Under Canadian laws, an acquisition and an amalgamation fall under the same conditions.

http://business.financialpost.com/investing/investing-pro/assessing-the-two-canadian-spac-deals-that-have-been-announced

!PRII Daily

I am more than a little disappointed that Stockcharts.com will not correct the massive -30% skew in Pring's Inflation Index, which ruins any realtime charting of interest rates vs. inflation.

It's like having temporary blindness when it comes to observing gold prices.

http://schrts.co/47oaO7

-F6