Sin: from the Placement announcement:-"Proceeds from the...

Sin: from the Placement announcement:-

"Proceeds from the Placement will be used primarily to continue preparations for Block 9 drilling and advance the Company’s technical and geological evaluation of the Santa Cruz Incremental Oil Recovery opportunity. The net proceeds will also be used for corporate costs and for general working capital purposes."

I cant see the placement being anywhere enough to meet the stated objectives (above) and also repay the loan. On current exchange rates of US$1=AU$1.38 the US2,5m = 15% annualised interest over 9months to 10 Jan 19, the US2.5m loan = AU$3,838,125 repayment by my calculations. So, how will MAY repay the loan when it falls due on 10th Jan2019? There are in my view four possible answers:- 1) Cash from the Cuban farm out in Dec 2018, or 2) Another CR, or 3) The Lender accepts shares in lieu, or 4) AP pays off the debt through the guarantee, in which case he then assumes the ownership of the debt and could either, take shares in lieu, or let it ride at 15% interest racking up the debt owed to him. For 2,3,and 4 alternatives, there will be a large dilution depending on what price is struck for the shares. So, hope for the first alternative folks. Cheers.