Ann: Payment Extension and Appendix 3B x 2 , page-19

Afternoon all,

Getting back to topic.
After having a bit of a look at the 2 main paragraphs in the latest announcement below:

"The key terms of the agreement:
Given the obligation of Redhill to pay the fourth payment to Sherwin under the Sale Agreement on
31 July 2011, the parties have agreed as follows:

"1 Grant of Option
In consideration of the payment of AUD$50,000 by Mutiny to Sherwin, Sherwin agrees
that, if requested by Mutiny in writing on or prior to 28 June 2011, Sherwin will not require
payment of the fourth payment until 31 August 2011, subject to, and conditional upon the
following events occurring on or before 28 June 2011:
(a) the payment of the sum of AUD$100,000 by Mutiny to Sherwin; and
(b) the issue to Sherwin of:
(i) 300,000 fully paid ordinary shares in Mutiny; and
(ii) 100,000 2 year unlisted options to purchase Ordinary Shares at an
exercise price of 12.5 cents per option.
2 Sherwin and Redhill agree that the date for payment of the Progress Payment payable
by Mutiny shall be extended until 24 August 2011.
END"

It looks to me like Mutiny will be up for $150,000 to extend the next payment of $4M until 24th August. They will also issue 300,000 FPOSs and 100,000 options for 12.5c as a goodwill gesture, the cost of those two issues is only $42500, so in effect I would call it a $192500 deal to give the company time to impress the market by kicking a few more goals, and wait for the share price to appreciate from the current low levels, before signing a deal. Remembering that a CR at 12c is a lot better than a CR at 8c.

Now looking at the 2 other paragraphs in the latest announcement, I have cut out the bits I think are important:
* "following recent exploration success"
* and "This will enable Mutiny to fully inform investors of the progress of its ongoing exploration program and to provide the board with the time to consider all funding alternatives prior to making the $4m progress payment.?

I think it?s fortunate that management are getting good drill results to negotiate with and are able to hold off on finalising a deal until a few imminent ducks are lined up (if that?s what is happening).

In the next month (based on the previous drilling time frames)I?m expecting the following announcements:
? Drill results from the diamond drilling which has been going on in the Northern part of the initial Deflector resource. This campaign commenced in Mid May and I?d expect the results to be released around 10th July.
? Further results from Extension drilling Nth and Sth along strike. This is a continuation of their successfull drilling in the Northern extension.of the Deflector resource. Results of this campaign were released in their latest announcement on 21st July. I?d expect the results of the further drilling to be released around 20th July.
? Spanish Galleon drill results ? 17 RC holes started <9th June. I?d expect these results by the end of July.

Now if these announcements are good (or great) then management will have some good bargaining power to tackle potential investors to come up with the $4M, and maybe some more.

The Feasability Study is being prepared for release in September and the better the drill results the more impressive the Study will be.

In my opinion I think the $195,000 deal was a sensible one. I have no doubt that John Greeves could come up with the $4M in time, but the decision is a strategic one. John has a lot of experience in this area so I?m hoping he is playing the game to win....

On the other hand maybe they?re just having a hard time finding the money, who knows. But I still think it will all work out good and Mutiny will be a cracker.
Busting