going concern ?, page-5

Hi Wayne25,

I have had 3 broker mates (Patersons, Bell Potter and Stonebridge Group) call Peter Landau to ask whether NKP would consider a placement at the market price (recently as last week when the share price was 17-18cents) and Peter Landau said a firm NO. He repeated that there shall be no capital raising until a Joint Venture is done.

I can see that NKP can borrow another $5-$10m without a problem. After all they do have 376m shares. With the falling share price it gets more difficult as you have to leverage more shares for the dollar.

I do believe that NKP has the next 6 months to do a deal as their existing line of credit would still permit it, however if it does stretch beyond that point I can see that they may be forced to do a placement at a steep discount to raise funds.

At the moment NKP is already on $11m loan ($5m working facility and $6m to resolve "H farm"). I can see that NKP may need to do a capital raising after a Joint Venture. I don't believe that NKP is going to be paid "$500m cash" since this sounds too good to be true but I also find it hard that Anglo is asking for "50% free interest" unless they are going to take NKP to court. I can see that the JV would be a progressive expenditure one which Researcher pointed out between CAZ and Anglo.

From the share price performance seems that we are months (1-3 months) away from any deal. Like Rod if the share price falls to the 12cents area I may dip in again for a short-medium term hold. If there is sudden up-spike in volume and shareprice then I will re-enter again. At the moment sitting on the sidelines is the best thing.