1.5m Loan at 10% p/annum. Board stacked with creditors. 1.815m due in two years time, including interest. That is a little less than the current value of Comets shares in International Graphite.
Comet will spend that 1.5m trying to raise capital, drill Barraba, and relist. The risk is that if Barraba is a duster, or they can't raise money for the drill program, they will spend the money in vain on salaries and attempts at permits. The debt will be called in, Comet will be wound up and your shares will be transferred for zero consideration to pay off the debt. Copper is not hot enough right now to really incentivize exploration on these 1:100 long shot drill programs. There's also management risk, who would give 5-6m to Comet to manage a drill program in it's current state unless there's a really good deal for the lender on the table. The upside is that if IG6 do well, we get a larger holding to raise money with and can avoid that transfer for zero consideration to pay our debts.
A lot can change in a year though, i hope it does...
CRL Price at posting:
2.0¢ Sentiment: Sell Disclosure: Held
