Quinsam Capital Corporation

All right. Well, it's 10:00 so -- hold on I'm just going to mute people here.

All right. Well, welcome, everybody.

And please welcome to the third quarter Quinsam Conference Call. I'm going to assume that everyone's already looked at the results and probably read the press release.

So I'm not going to go into what's already there. Third quarter, basically, we were slightly in the black, which is not terribly dramatic one way or the other.

And there wasn't a lot of activity in the quarter. So really, the key update is what's going on here in Q4.

We have 2 of our private investments that are both at this stage, looking to list. The largest one, we've carried it under the name Peninsula.

It's announced to go public financing with a syndicate of large investment dealers here in Toronto under the name of Renterz. It's a U.S.

single-family rental business. It's out there in the market now trying to raise funds at $1.90, our carrying value is quite a bit below that.

At this stage, they're in marketing. I understand that it's going sort of okay.

We're hopeful that the transaction will complete. There's probably, I'm guessing, some risk in the $1.90 price, but we'll see.

That's an important development for Q4. And obviously, we hope that it goes ahead.

The other go public that we're looking at here in Q4 is a company called Electro Metals. That is -- it's a relatively traditional Canadian mining story, copper, gold properties.

And the market, obviously, for mining is relatively good right now. They are awaiting final approval from the exchange to list.

I understand they're down to the short strokes and that they expect to get final listing approval in the next week or 2. And once they have that listing approval, they believe that they have the funds lined up to close and then commence trading.

So those are probably the 2 big things in front of us for Q4. Between the 2 of them, there's about $0.02 of NAV that are in play here.

So we hopefully will see the amount of liquid investments move from the $0.06 level up to $0.08 and obviously, hopefully beyond that with the expected listing prices of both Electro Metals and Peninsula above where we're carrying them.

Excuse me, Roger?

Yes.

Quick question. Electro Metals, what are they into?

Well, it's a fairly traditional mining story. This is actually a company that we bought quite a long time ago as a cannabis company.

Back in the day, it was called Ancient Strains, and it was run by Daryl Hodges, who used to run Jennings Capital. And he was a mining guy in his -- for most of his life.

He's a geologist. He always focused on mining companies.

And when the cannabis market turned, he decided to reposition it as a mining play. So he's been working with that for the last 2 or 3 years.

He tried to list about 18 months ago, but obviously, mining markets were much less favorable than they are today. And that attempt did not go ahead.

He couldn't get the money. But obviously, now we're looking at a much more favorable mining market.

What's the -- is it gold or is it...

It's copper, gold. It's sort of...

Copper, gold.

It's -- most of the NAV is copper, but it's got a significant gold byproduct. Both of those commodities are quite strong at this stage.

And it's a pretty -- it's a very conventional asset. It's Ontario.

It's got a resource in place, like it's a pretty conventional story, and it should be able to complete its financing and list. It's just a question of value, I would say.

So those are on the private side, the 2 visible situations right in front of us. The other one that is progressing well, I would say is A-Synaptic, which is about $0.02 of NAV.

A-Synaptic is developing a CBD treatment for epilepsy, and it's about to start a clinical trial. It's been approved by the FDA and Boston's Children's Hospital is going to do the trial.

They also have been working informally on a second indication to use the same treatment for Parkinson's. And they've actually been given a $3 million grant by the Michael Fox Foundation to take it from its sort of informal trial.

It's now like basically being given to some patients and has been for about a year outside of a formal trial with very good results. So the Michael J.

Fox Foundation is funding it to go into a formal trial for approval for Parkinson's as well. So that -- it's progressing well.

We hope to start doing a U.S. go-public process this year.

It's not going to happen, I don't think, by year-end, but hopefully, early in the new year, that will begin its march to being public. Otherwise, as far as Q4 is concerned, we have one company, Newlox Gold, which it's under a cease trade at present because its financials are late.

And we decided to be conservative to take it to a valuation of 0 in Q3. We definitely do not expect it ultimately to be valued at 0.

It was trading around $0.05 or $0.06 before it was halted and it raised money at $0.07 as recently as about 6 weeks ago. So we expect it to be back and trading at those sorts of values in and around the end of the year.

But to be conservative, we took that down. So that hopefully is money in the bank for Q4.

We also have a few companies that are at this point, even with the sell-off of the last day or 2, above where they were at the end of the quarter, BluMetric, NeoTerrex, Royalties Inc. which won its lawsuit appeal and City View Green, which is now a cryptocurrency play, no longer a cannabis play.

So with any luck, Q4 will be a decently profitable quarter. But obviously, there's volatility out there, and we'll have to see what happens over the next 6 weeks or so.

And with that, I'll open it up to questions. If anyone's got a question, just take yourself off mute.

Question, Roger. Anything coming forward about a transaction?

Transaction. So we've had some very good discussions this quarter with a company that we're quite interested in.

It's an American-based company. And because of that, there are some income tax complications for the main shareholders, like they obviously don't want it to be a taxable event, but there are some problems in making it not a taxable event for them.

So they are kind of mulling some structural and tax issues. But it is quite promising.

It's a company that's in a very interesting business. It makes nice cash flow.

The valuation is reasonable. And their funding requirement is quite appropriate for us.

It's -- they don't really actually have a funding requirement. They're a cash flow positive business.

So really for them, what they find attractive is the ability to raise for them a relatively small amount of money with a small amount of dilution and have a company that would have a very tight float that they would be in a position to influence the share price of. So for us, it's quite interesting because we think we would get a quite decent win coming out of the gate.

But this tax issue is something that -- it's got to be solved because if it can't be solved, then they're not going to basically take their whole company value into income tax -- into income and pay tax on it on go public. It's just not viable.

Otherwise, I would have to say there's not too much going on. I mean we certainly could go and do a mining transaction, I think, quite easily if we chose to.

It's really not what I would want to do. I'd much rather get into an operating business with cash flow or very, very near-term cash flow.

Don't really want to go into a mining exploration situation where it's significantly cash flow negative and you're just kind of hoping for geology to work out your way. So that's something that it's certainly fine for an investment or 2.

Happy to make those sorts of investments, but not sure I want to bet the whole portfolio on one mining situation.

Yes, I would have to agree with that. All right.

That's good for me.

Any other questions? There's no further questions.

Thanks for attending, and we'll talk to people later.

Thanks, Roger.

Bye-bye.

Thank you.