re : steady week, page-8

Dotcom,
I hope for your sake, share traders will push the sp higher before 30 June. CMQ is one of the riskiest company and the only reason for no news is because there is no good news (CMQ even counted the appointment of the non-executive chairman as an achievement) The quality of the information they pumped out is even less desirable.

The ASIC case is progressing not-withstanding what Mr Williams said : “QUOTE : ASIC & CMQ had agreed to DELAY the ongoing process COURT process by a number of months”
Read for yourself the consent judgment easily ascertainable and can be downloaded at http://esearch.fedcourt.gov.au/Esearch?showDoc=24670312 The ongoing discovery process (very much a part of the litigation process) is very much alive and still proceeding. ONLY the 11 April directional hearing was postponed to commence in the week commencing 12 June, a mere 2 months (a NUMBER of months). Were shareholders misled by the announcement?

We will know soon whether CMQ can satisfy the revenue covenant by 30 June. Despite what all the CMQ spruikers posted- arguing all sorts of reasoning why even if the SA $1.4M sale receipts do not come in it can be booked as a sale, read what the covenant said: “QUOTE:- Require CMQ to achieve gross revenue from all sources of at least $4M from all sources for the year ending 30 June 06”. If you study the CMQ history there were plenty of “confirmed sales” which did not translate into sale receipts. A previous Mizuho/Stark covenant specified ‘confirmed sales’ which was satisfied by the SA $1.4M confirmed unconditional sales for which Mr Williams had delivered the goods last year but had since described it as ‘positioned’ when it did not reflect revenue!

In the context of past history leading to the Stark’s covenant requiring “REVENUE”, there should be no doubt REVENUE in simple English means cash receipts and not any of the spruikers’ bull.

Why would Stark convert now? Go read the terms of the financing (& previous postings on this topic) and you will see compelling reasons why Stark will not convert or why Stark subscribed to the bonds.

The more disturbing news is even if CMQ survived through 30 June, there are still a mountain of impediment in front of it. Mr Williams announced that the long awaited 20tpa name plate capacity is now scheduled for the “later half of the year”. From the history of CMQ announcements and the plant saga, one should not be surprised if it turned out to be the later half of the FINANCIAL Year’ instead of the calendar year!.

Not-withstanding the plant achieving 20tpa and in the most unlikely event that EVERYTHING works PERFECTLY for CMQ ie, they sold EVERY gram of the 20 tonne API; the 20tonnes API brings in real REVENUE; and the REVENUE is at A$1M per tonne API (CMQ history shows the possibility of all these occurring at the same time is almost like striking a X-Lotto Jackpot); this remote chance only equates to $20M annual sale receipts for a company burning between $2M to $3M a month producing bugger all products and near zero sale receipts. This is why Mr Williams MUST RAPIDLY expands production capacity just to keep CMQ’s dream (fantasies?) alive. And where will the funds for the DESPERATELY NEEDED expansion come from? Are you aware that CMQ can incur ZERO SECURED debt and must require Stark’s consent to incur unsecured debt above $200,000.00? That’s for a company burning between $2M to $3M a month! So where is the DESPERATELY NEEDED funds going to come from?