Ann: Entitlement Offer to Raise up to $5 Million, page-19

When I first saw the announcement about the capital raise, my initial thoughts were "it seems unlikely that MGT will be closing a deal with a JV partner anytime soon".

However, I then thought "MGT seem to have a habit of having a good announcement shortly after announcing a capital raise". So I thought some more about that. Even if a JV partner was signed to contribute funding towards the DFS funding requirements, that would not cover MGT corporate costs. So MGT would still need to raise some capital even if a deal was signed.

I then looked at a couple of differences between this capital raise and MGTs last capital raise:

• The last capital raise had a free option attached for every two shares subscribed. Options are a good incentive to encourage those who believe in the future to subscribe for shares. As no options is offered this time, do the board think they don't need options to encourage shareholders to contribute this time?
• The last capital raise was partially underwritten. This could go two ways. Either the costs of underwriting were too great to justify or the board doesn't think they need to underwrite because good news will be released before the offer closes.
• The last capital raise was non-renounceable, so every shareholder could benefit even if they did not contribute (including the directors). This capital raise is renounceable, meaning there is no benefit if you do not participate.
• The last capital raise there was no mention of the board participating in the capital raise. This time it is noted that all directors, the CEO and CFO are participating.

Do the board actually expect that a deal will be signed in the coming weeks and would like the opportunity to participate in buying some more shares at this price?

I will be interested to see how this plays out and will be watching with interest from over the fence (border).