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Interesting and educational. Thanks, DavidW.

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KainCarver

2,520 Posts.

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07/12/17

13:14

Post #: 29452778
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Originally posted by DavidW ↑

Not quite USC, LOI's have legal status and you will see how that pans out with regard to DNI. That is separate from personal civil legal remedy that maybe undertaken by Mr Moura or Randal.

The other big difference is that Brazil is Randal's backyard. Not only has he conducted companies out of Brazil, but I believe he married a Brazilian and has family.

CGM was committed to Madagascar, and when you set out your critical path in the operations timeline for both the graphite and the lithium you can make contingencies like for cyclones, but you don't expect to be shafted to circumvent an agreement by the means that have allegedly been adopted by DNI that operates from a first world environment, i.e. Canada where there are rules and sanctions.

If the company has the legal means to enforce an agreement when the stakes are high, why not use it? The Canadian gold deal was settled quickly as legal cases go and did not drag on. The law was clear cut.

If its the people you are dealing with, then I don't see this happening in Brazil with regard to CGM and Randal's background and networks. CGM is a small company and has been planning and building growth and its diversity is its strength in tough times.

The SWOT principles to work out opportunity cost have never been more relevant than in this case. Any trained project manager or CEO would look at the economics of an operation by examining the strengths and weakness. But the opportunities and threats in Madagascar are not just in terms of market share, government and environmental implications, but local, power politics and legal implications of dealing in a 3rd world environment. Then you throw in a JV partner like DNI is turning out to be. Salient lessons for some I'm sure. Make a great case study for economics/legal students I used to lecture. That's why these LOI's are put together by the right people, to move forward but also to protect their clients.

There may be no other short term option other than to move the Brazilian project forward. Yes, we do own the tenement in WA that holds cobalt, and yes the Canadian gold may enter the medium term.

As such it is not my intention to bother Randal. He knows his options and has the right people to advise him. But I will stay the course because I think the lithium will prove up. Never put up more than you can afford to lose. People have to do their own risk management. David.

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Interesting and educational. Thanks, DavidW.

CGM Price at posting: 0.8¢ Sentiment: Buy Disclosure: Held
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Interesting and educational. Thanks, DavidW.

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