Lots of information to digest here. I make the following observations for stakeholders:What a mess!
- Over half of the $33.5m of "new funding" is a prepayment on future magnetite sales. It is not equity/shares. The Company will incur costs in the future and receive no sales revenue for it.
- In the ASX announcement of 23 October 2023 the Company notes that the prepayment arrangement is secured and yet no-where (in the ASX announcement, the Annual Report or the Notice of Meeting (NOM)) can I see the details of the security being disclosed. The security for the pre-payment should have been disclosed.
- The Company is assuming that the SPP will be fully subscribed and raise $5m. This would appear to be unrealistic.
- The pro-forma balance sheet in section 14.1 of the Notice of Meeting is worth a close look (bear in mind these numbers are now 6 months old).
- The Company comes out of this with $17.5m in cash (and that is assuming the $5m from the SPP) but still owes $8.3m to creditors and $22.5m to Oz Pro (Vendor Finance) by June 2024.
- There is still a current asset deficiency (current liabilities greater than current assets - an indicator of insolvency) of $14m.
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Ann: Notice of Annual General Meeting/Proxy Form, page-3
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