Mike Kachanovsky: First, the settlement with Coeur injected $10M in working capital upfront for Rye Patch to move ahead. Second, it gives Rye Patch a revenue stream. The royalty part of the settlement will contribute another $28M of recurring income that Rye Patch can use to fund projects. There is about $38M in cash value from the settlement, which works out to about $0.25/share in value, on a stock trading at about $0.19/share.
TGR: In other words, if you believed in Rye Patch before it staked the Rochester claims, you should really believe in it now.
MK: Exactly. I think the sellers in Rye Patch are speculators who bought in expectation of a bigger settlement and more of an upside as the lawsuit progressed. I look at it from the other point of view: A lot of good companies are dead in the water with no access to capital. Rye Patch has now emerged as one of the best funded juniors, ready to spend on its other properties or to make acquisitions. A stock that trades at $0.19/share has a clear path to survive this downturn and to take advantage of the low-price opportunities out there. I am buying it and plan to continue to buy as long as I can get shares in this price range.