Interesting update by CNL on 13/4/15, it doesn’t look very...

Interesting update by CNL on 13/4/15, it doesn’t look very encouraging for us poor long suffering shareholders.

According to the latest CNL update a cash call was made on 21 October 2014 for US$3.3 million (approx. A$3,75m) by CPSA from Celamin. In the CNL rights issue offer document - 4 November 14 – it showed a "use of funds" for minimum raise (A$7.575 million) providing only A$3.15 million for the Chaketma Joint Venture, it made no mention of the cash call. CNL now says the US$3.3 million cash call not "justified", but why did they sign an Agreement on 10 December 14 if they not legally obliged to do so?

By signing this CNL must have believed they were in default.

Looking to the use of funds page 24 of rights issue offer document, after expenses and repaying loans to African Lion CNL would have been in an underfunded position and unable to pay this cash call if it only did the minimum raise.

CNL announced on 12 December 2014 that the Rights Issue closed on 10 December and then on 18 December 2014 CNL announced it had successfully raised A$7.575 million, the minimum! The Company Directors would have known that this would be the case as any director worth their fees would be monitoring the subscriptions from shareholders on a daily basis during period the Right Issue was open. They would do this because they have to be in a position to advise the underwriters what their exposure will be.

The question then is what time of day was the agreement on 10 December 2014 signed, was it signed at the CNL offices in Melbourne or in Tunisia and was before or after the closing of the Rights Issue? There is a difference of 10hours between Tunis and Melbourne during daylight savings.

If it was after, the Company was not only in default but would seem to have not have had enough money to even satisfy the cash call based on the offer document, and why was the default or this change not announced. Did Celamin advise Patersons as the underwriters of this situation?

With one unannounced default notice for US$3.3 million (rectified at the last minute by Agreement 10 December 14) and presumably now aware of the default process - How did Celamin manage to mismanage the payment of the January 15 cash call of US$2 million? It would be interesting for shareholders to know what actually happened?

The result appears to be that Celamin is no longer a shareholder in the Chaketma project.