and i thought bergen was a joke...

Resolution 5 - The company intends to use the funds raised from the Share Placement towards expenditure commitments and development of existing projects, corporate and business development activities and general working capital.

So, this raising is supposedly to fund 4 main matters.

1) Expenditure commitments. Generally this would mean a repayment of loans amongst other things (listing fees etc). Wouldn't the highly touted operational cash flow be able to cover this? If not, does that therefore mean that Conti cannot service its debt repayments? Are they insolvent?

2) Development of existing projects. Ahhh, what are the finance facilities for then?

3) Corporate and business development activities. What happened to less corporate overheads? Why would a company splurge out on corporate fees when coal prices are so low and mines are struggling to make a profit?

4) Working capital. Working capital is something required by development companies when there isn't revenue coming in to pay employees and operating costs. Conti are a producing company, with 2 mines running, for a total of 2Mt of ROM coal per annum. For any ordinary company of Conti's market cap, that would be more than enough revenue to pay a reasonably sized workforce. Something a little fishy here. Most likely Conti are making a loss on their mines otherwise they would be able to pay their employees from mine cashflow.

How about these old chestnuts from the company...

1. Ferreira and Vlak are supposedly cashflow positive.
2. They supposedly have loan agreements of 10s of millions of dollars in place.
3. They supposedly have $20M cash from the SIOC transition.
4. A supposedly imminent finalisation of the $10M Vanmag transaction.
5. Penumbra will supposedly be online by early Q4 (3 months away) generating $15M free cash per annum.
6. The board is supposedly highly experienced in South African coal mining, and thus should be able to manage their capital.

If just one of the 6 above statements were true, they wouldn't need to place shares every quarter to raise capital.

So the question must be asked: "Cashflow positive", "finalised transaction", "Penumbra $15M pa". Do all of these misconceptions amount to one giant lie that is Continental Coal?

Socius, Bergen and now this new placement. The worst part is that with all these placements, retail shareholders have never been offered a piece of the pie.

Socius funding obviously failed to deliver results. Bergen hasn't provided enough capital by the looks of things. If this $10M placement doesn't work, what happens then? For all the cashflow that these mines are supposed to be making, it seems incredibly odd that funds are raised time after time. What a disaster; something's clearly not right here.