I attended the UC AGM last Thursday. I’ve been meaning to post some info here but have been busy with the family lately. It is Christmas time after all, you know....

I showed up on the 10th floor, 595 Howe St late, at about 10:10 am. Initially I was a bit confused because it was just a law firm’s board room. After walking in, I thought I was in the wrong place, because there were just 4 other people there: lawyer (?), Jim, CFO and one other company officer I forgot the name of. I do kind of recognize Jim from his picture.

There were no other investors (where were all of you?). After assuring me that I was at the right place, the lawyer told me the AGM was officially over. They started at 10am to go over all the official proceedings in the AGM package that I also received a copy of at home, and has completed all the official business prior to me getting there. Just as I was unsure what to do next, Jim introduced himself to me, and said he could give me an update if I’d like. Here’s what he shared with me:

McFauld’s

• The most recent drilling program is finished with 5 holes completed. There were some visual, but the visuals were not significant enough to justify a separate news release (playing it safe?)
• Assay results still hasn’t come back for the 5 recently completed holes, and a few hole completed prior to that. The labs are really backed up by Noront and Freewest. All the assays are taking a long time.
• The next drilling program at McFauld’s won’t start until Q2 of next year. This is due to the fact that the flow-through funds that support the next drilling programs won’t be released and available until Q2 next year.
• In the mean time, Jim says to watch for developments of our neighbours heating up the whole area. If the plan for a railway proceeds further, much of the current discoveries would be economical.

La Yesca

• Jim’s focus for the beginning of next year will be on La Yesca.
• Financially, Jim is adamant about the fact that he does not want any further dilution. He seems confident he will get the loan. I’m reading between the lines and think that the loan would be from the Mexican Government. I can’t agree with Jim more here. It’s nice to see a CEO that has the long term interest of investors in mind. If there’s the possibility of getting a loan, why not pursue that rather than dilute further, even if it take a little longer to get a loan. Further dilution should be a last resort, especial at 9 cents.
• Tailing Grades: While the initial grades during the test run are lower than originally thought, multiple sampling reveals that the grades are different at different at different part of the tailing pile. After stripping off a top portion, they are able to reveal economical grades underneath that will feed the mine once it’s up and running.
• The main hold-up last year was the ball mill, which need to produce much finer output (ok, I’m an IT guy, not a miner, so I’m can’t recall all the right terminology) for the updated extraction method to work. The loan will pay for the final equipment upgrade at La Yesca.
• While on the surface it may seem that we’ve stalled for one year at La Yesca, Jim seems to have gained all the necessary knowledge to make La Yesca economical. And it seem that it would be economical soon. I know I know, I’ve heard that before too, but this time it’s not just a marketing banner like in the Hamlin days. This time we actually understand exactly what the plan is and what’s holding us up.
• Jim wants to drill in Mexico, and that drilling will not depend on funds from La Yesca. He has already obtained an 80K grant (grant! no need to pay this back) from the Mexican government to drill around a couple of veins of gold that the historical miners used to mine off a cliff. He seems really excited about this target.

Here’s pretty much everything I can recall from our conversation that day. Jim was very frank and open. I just wish I had more background in mining to take in more of the details from our conversation.

So the choice is yours.

LD