Ann: Trading Halt, page-62

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LT_Investor

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04/05/18

16:01

Post #: 32892076
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Originally posted by eshmun ↑

I am not being dramatic.

I once spent 10 years on a committee of creditors of a mining and exploration company both during administration and in liquidation.

The corporations law is very strict. The company’s auditors made a judgement in the recent annual report that the company can validly report on a going concern basis based ostensibly on the likelihood of the company being able to access finance on the basis of the proposed Sprott senior secured facility. The facility was expected to be completed by the end of March which is more than a month ago. Instead the company has been suspended pending the outcome of a CR.

The company has not informed the market as to the reasons for the delay in completing the facility so one would be safe to assume the facility has run into trouble or is not near enough to completion to allow the necessary first US$40 million tranche to be banked, hence the need for an urgent capital raising.

As I said in my previous post any party wanting to inject capital into BDR for equity would need to be very conversant with the financial state of the company as when it comes to situations involving long dated unsecured debts the financial state of the company can get complex and difficult to determine.

The only parties with enough knowledge/information are the management, the company’s auditors (KPMG), the parties to the merger document who have the contractual right to see BDR’s monthly accounts and presumably Sprott considering they have put forward the funding proposal. For the time being there is no news on Sprott and I’d think there is little prospect of sophisticated investors or non-aligned brokers coming to the rescue without a lot of due diligence. As mentioned before, any delay in this CR and the directors will likely be forced to get some opinions from duely qualified practitioners as the state of play seems to have changed markedly from the last time their auditors gave an opinion. Esh

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It is out of our hands. Let wait and see shall we. Nothing much we can discuss.
Thanks god it's Friday!

BDR Price at posting: 8.3¢ Sentiment: Hold Disclosure: Held
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