In the Appendix 3B released today (ref 14), BPH have changed the nominated use of the funds, after the funds were raised, to include “Debt reduction”:
Column 1
Column 2
Column 3
Column 4
0
Entitlement Prospectus (ref 13)
Completion of rights issue letter (ref 15)
Appendix 3B (ref 14)
1
Uploaded to ASX
23/11/17
26/1/18
31/1/18
2
Investment in oil and gas
X
X
X
3
Investment in Cortical and HLS5
X
X
X
4
Maximum offset amount
X
X
X
5
Expenses of offer
X
X
X
6
Working capital
X
X
X
7
Debt reduction
X
8
Note: The confirmation in the rights issue letter is by the way of the statement, “The company has previously announced its intention to apply these funds to its investments including exploration into oil and gas”.
Has the addition of "Debt Reduction" been done to enable BPH to pay Gandbridge again?
Are we going to end up in the same situation that we have been in for the last 18 months, see below my post 30259571 (copied below):
In the period 1/7/16 to 31/12/17 BPH has raised and spent as follows:
Column 1
Column 2
Column 3
Column 4
Column 5
Column 6
1
Usage promised in SPP (1/6/16)
Usage promised in Offer document (11/01/17)
Actual funds raised / use of funds
Percentage use against total cash
2
Cash at 1/7/16
$112,000
3
Total raised
$1,387,000
4
Total cash
$1,499,000
5
6
Invest into Cortical Dynamics
Total raised to be split across 3 investments
Total raised to be split across 3 investments less Working Capital and Expenses of offer
$100,000
6.67%
7
Invest into HLS5/MDS
$0
0%
8
Invest into Oil & Gas
$0
0%
9
Working Capital
$60,000
$378,000
$786,000 (incl. forecast from 30/9/17 Appendix 4c)
52.43%
10
Expenses of Offers
$0
$20,000
$113,000
7.54%
11
Repayment of borrowings (to Grandbridge)
$0
$0
$160,000
10.67%
12
Cash remaining (based on forecast from 30/9/17 Appendix 4c)
$340,000
22.68%
In both the SPP dated 1/6/16 (finalised 6/7/16 – refer to Ref 1 and 2) and the Offer document dated 11/1/17 (completed 1/3/17 – refer to Ref 3 and 4) nominated that the funds raised would be used to invest into:
Cortical Dynamics
HLS5 / MDS
Advent / Oil & Gas
As at 30/9/17 (latest information available) only $100,000 of the funds raised in BPH has been invested into Cortical Dynamics since 1/7/16, with NO cash investments into Oil & Gas or HLS5 or MDS (Appendix 4C uploaded to ASX:BPH 31/7/17 (ref 6), also refer to note 10 of the 2017 financial accounts – ref 9)
The SPP and Offer documents nominated total Working Capital / Administration and Corporate Costs from these raisings to be $438,000 (SPP = $60,000 (ref 1), Offer Document = $378,000 (ref 3)). Based on the actual costs to 30/9/17:
BPH has forecast a total spend of $786,000 on Working Capital / Administration and Corporate Costs to 31/12/17.
Repayment of borrowings (to Grandbridge) since 1/1/17 = $113,000 (Grandbridge Appendix 4C uploaded 26/04/17 = $70,000 (ref 10), Grandbridge Appendix 4C 01/11/17 = $40,000 (ref 11)). A repayment was nominated prior to this date in the Grandbridge App 4C uploaded 01/02/17 = $50,000 (ref 12).
There was no repayment of Grandbridge loans nominated in either of the raising documents.
BPH Energy announced in its 2017 half year accounts (ref 8 - refer to Note 2c on page 10) that, “Grandbridge Ltd has confirmed that financial liabilities of $569,213 (30 June 2016: 285,392) will not be called upon for repayment for a period of at least 12 mouths from the date of this report”. Despite this guarantee, the Directors of BPH Energy paid Grandbridge $113,000 since this guarantee was provided (up to 30/9/17).
Can the BPH Directors (and Tom Fontaine who was a director at the time of the January 2017 raising) please explain:
1) Why the funds have not been invested as nominated in the January 2017 Offer Document
2) Why the Working Capital expense is such a large portion of the total raised funds
3) Why the nominated Working Capital amount in the January 2017 Offer document ($378,000 – Ref 5) is forecast to be spent in under 9 months following the raising rather than lasting the 15 months as nominated in that document (ref 6 and 7)
4) Why money was paid to Grandbridge despite the Grandbridge guarantee
5) If the funds raised in the current raising (ref 13) will be spent/invested as nominated in this document?
(20min delay)
