There's no volume to sell into so holders can't really get out even if they wanted to. No one is stepping up to buy any either so it will continue within a tight trading range until the company outlines it's plans, which they are meant to do this month.
Most holders are well underwater and will be hoping the company can show a path forward that includes a funding package to see the project move forward, because $15m including the $5m debt won't go far.
The company can use the $156m already spent as part of their 40% equity threshold. At a predicted $473.5m total cost, the debt funding required would be $284.1m and equity $189.4m, so another $33.4m needs to to raised to be spent on the project. Extra would need to be raised for uses other than what is required for direct project invesment.
If the company secures debt funding then the sp will most probably jump substantially, allowing for an orderly raise rather than one in desperation. This $5m funding by Lew may yet be a back-up to ensure the company has adequate cash to carry them through until a debt funding package is finalised. If this is the case then the related loan makes sense, otherwise it comes across as a desperate measure.
We now await HAS to update the market as to the state of the full debt package, or of a staggered debt funding strategy, which seems to be the direction they are now planning, which in itself indicates a lack of support at the moment due mainly to the current REE price.
These are just my thoughts and figures above and may be wrong so take them with a grain of salt.
HAS Price at posting:
28.5¢ Sentiment: None Disclosure: Held
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