According the updated DBourse FAQ, TGC has 4000 shares
outstanding (once the offering is filled) and this offering represents 400,
or 10%, of those shares.
Based on the current price of gold, this offering should raise US$446,760.
(400 shares x 100gg x US$11.169/gg)
TGC has fixed the dividend at 7.2g per annum per share.
Based on current price of gold, TGC will owe US$321,667 per year in
dividend payments, of which only $32,1667 is paid to outside investors,
and $289,500 is paid to the other 3600 shares presumably held by TGC
founders and staff.
(4000 shares x 7.2gg x US$11.169/gg)
(400 shares x 7.2gg x US$11.169/gg)
(3600 shares x 7.2gg x US$11.169/gg)
It seems that their 1st year of dividend payments (assuming they make the
profit to pay them) is disproportionately high to the amount of capital they
will raise, and a large amount of the capital that should be available for
operational growth will be distributed to inside shareholders.
What would make the numbers more believable (and ethical) is if the 3600
shares presumably held by TGC founders and staff were of a different class,
not receiving dividends.
I would like to hear a confirmation or denial that the other 3600 shares are
of the same class with the same dividend rights.
As is standard practice and in compliance with insider trading rules, the
beneficiary holders of the other 3600 shares should be published information
(at least to other shareholders); along with any restrictions on the share
(i.e. can they be sold now on the DBourse?) and any major transactions
involving those shares
[And before someone jumps down my throat that insider trading rules are not
libertarian, let me say that it is simply good investor relations and risk
management to follow, in principal, generally accepted rules and standards,
such as GAAP accounting and SEC/NASD information disclosure guidelines.]
Adam
PS. Sorry for the USD conversions, I can't think in terms of Gold grams yet.
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