Each one in plain English, with the numbers worked through for a shareholder.
21 Nov 2011material agreement▼ BadMajor
Del Toro Silver agreed to buy up to 75% of the KM and Raddlefinger mining claims in Siskiyou County, California from Bowerman Holdings for $6.525 million - a $4.5 million secured promissory note plus 40 million new shares - a huge commitment for a company that had been financing itself with $50,000-$200,000 loans from its own officers.
Del Toro Silver raised $75,000 from thirteen investors in a private placement at $0.04 per share - a steep drop from the $0.10 unit price ten months earlier, reflecting the stock's declining value.
Del Toro Silver issued 344,828 shares to convert part of a $55,000 convertible note, the first sign of the note-based dilutive financing that would recur through its history.
Del Toro Silver dismissed its auditor MacKay LLP; MacKay's prior reports had flagged substantial doubt about the company's ability to continue as a going concern, though there was no disagreement over accounting matters.
Del Toro Silver raised $200,000 through a private placement of 2 million units (one share plus a two-year warrant to buy another at $0.25) at $0.10 per unit.
What it means for a shareholder
2.0m new shares at about $0.100 to raise about $200,000. That's 16% dilution: every existing holder's slice gets 16% smaller. If you held $1,000 of shares (10,000 at the issue price), your slice goes from 0.0949% to 0.0798% of the company. To keep it you'd need 1,898 more shares - about $190 at the issue price.
Now renamed Del Toro Silver, the company amended its Dos Naciones option agreement with Yale Resources, alongside a capital raise to help fund the required exploration spending.