Mitchell Drilling, page-47

Thanks @Bailey241

Grafex - Yeah, I mentioned last night that the liability could go on to 5.5 million
You are probably right that the capital gains issue is a matter of Sheffield’s connections vs Paula’s connections. I would assume that Paula has a fair amount of connections, herself. Conceptually, the liability makes no sense, although I’m not suggesting that we would be free from it.

Like I’ve said, I’ve not researched Grafex enough. Based on my limited understanding, though (refer @OMEGA MAN post), TON has made it clear that they will pay 750 K in cash and are not paying anything more towards 100% until the tax issue is cleared. With respect to shares being issued, that would not lead us into admin. Shortage of cash would. I would have assumed that TON should have paid off the 750 K, already and issued shared to get to 90% although I am not sure. Once more, Grafex is not an area that I’ve researched too much on.

CR underwriting, Brad the salesman etc. – Look Bailey, all these issues are subject to different opinions. So, I’m not going to go further into this. For every critic of BB, he had a fan too, and his new company shareholders too don't seem to have much of an issue with him. People as diverse as hardcore TA guys like @insaf and hardcore FA guys like me, also don't seem to have much of a problem with him.

All I know is that in April 2015, I had an opportunity to sell at around 60 c (I wasn’t on my computer when it was 71c), and hesitated. I could still have sold for the rest of the day and hesitated. If anyone wants to place all blame on him, that is their issue. I just did not see in December how it was going to help, and price movement since then, suggests everything. You’ve been a critic of me in the past but surely you’d know that I went from bullish to very bearish around December onwards, and certain things I’ve mentioned then have happened. As @Cosmoterios just mentioned, knifing BB at midnight in the middle of the CR caused tremendous uncertainties in the market place. I know it did cause much uncertainty for me, and I mentioned several times that this is not going to end well. Worked out in my favour though, as at least, I did not top up then. I’ll just leave it at that.

GMP – I remember many discussions around that time about whether GMP would give full 4 million or only the differential amount, and there were multiple opinions.
I’m not personally familiar of Brad’s and GMP’s relationship; so really cannot comment. I did mention that I’m not sure of whether they really couldn’t get the 11 million fully underwritten or whether they just did not budget it properly. However, it should be noted that the board would surely had some ideas of the liabilities around that time, as against cash. So surely they knew that just 4 million would be extremely squeezed.

DFS – Yeah, I mentioned that DFS payments are most likely included in the payables. Once more, we were told that CR funds were to be towards DFS. So that should have been covered; although considering other things that should have been covered and were not, I’m not really sure.

The issue is how much of the other amounts have suddenly crystallised as liabilities. I find it hard to believe that something has dramatically changed from the prospectus date till now. If so, then the appropriate info was probably not mentioned in the prospectus, and that is another issue altogether. You could be right though and this could be one of the wild cards. Refer below what I mentioned when replying to TG.

Hi @Tradergimp – I really don’t know but theoretically, something you mentioned could have happened, and is one of the many wild cards. Really important to understand that what I've tried to quantify was mainly based on what was already mentioned and identified as liabilities.

If any of you followed graphite company IMX resources, there was the sudden wild card of a court case which came about right in the end, some months back, with a huge potential liability. Although a very disputable case, the damage to the share price was already done.

Hi @Cosmoterios – As you said, I mentioned several times around that time that the uncertainties caused by his dismissal in the middle of a CR, are not going to help the company in the slightest.

With regards to what can be salvaged right now, look, I’ve personally mentally written things and my investment off. I’m not sure about others.

As you rightly said, 2 million can get up and running again, but at least 5 million would be much better to survive a year properly. Theoretically not impossible, but I’m personally wary of putting in any more money here. I thought a lot of the recent drama was completely avoidable, like untimely dismissal of BB in the middle of a CR, lack of some basic calculations to see if cash was enough against liabilities around the time of prospectus, hiding top 20 and increased uncertainty, etc. So, IMO, if TON is going to continue on this track, even some basic funds will get us back in the same position after some time.

It is a little sad to a company which held much promise go off with a whimper.
Anyway, I’ve commented plenty for the day. I was only going to pass my morning’s post but ended up replying to many posts addressed to me. Probably need to go now. Cheers and have a good Sunday.