ADY 0.00% 1.2¢ admiralty resources nl.

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  1. 749 Posts.
    Dear ADY
    The recent announcement regarding capital raising at elast provides some certainty for medium term funding of ADY to continue operations.

    Of concern however is the term "sophisticated investors", which with recent events involving Opes Prime, is synonymous with practices detrimental to share holder value.

    Is there any assurance with these agreements that activities such as share lending for short plays and other such activities will not be permissible with this issue.

    Kind thanks in advance

    Response From Phillip
    Hi
    I disagree - there was never any uncertainty regarding our funding:

    to summarise from our quarterly report:
    $60m from NAB based on Rincon Project
    $40m from Lithium tender
    $10m overdraft from NAB
    $40m L/C from Shougang/NAB
    $x m from Cornell if required
    $200m from Investment B based on WISCO and Shougang contracts for $1.8B x 2 =$3.6B
    total $350m

    Some analyst from Resource Stocks also claimed this the other night but clearly he doesn't read our ASX announcements.

    We have 86 highly paid professionals on staff so our wages bill as per the last quarterly is in excess of $4m per quarter. So from time to time this year only we need a topup until the above debt facilities are in place. Remeber 4 million tonnes per annum of iron ore is about $280m revenue.

    "Sophisticated Investors" is a definition in the Corporations Act and Opes Prime who we had nothing to do with isn't one as they held a dealers licence. We borrowed money from the directors' private companies. Lodge Partners who provide research, are getting us a spread of institutions such as superannuation fund managers and managers of small cap funds.

    Your and others preoccupation with share lending is misguided. Short selling has been around since I commenced my career in stockbroking in the 1980's. Short selling is going on in all stocks people make good money for providing the service and even simple broking systems like Commsec offer it.

    Having said that there is a DvP agreement that they won't dispose of their holdings for 12 months so that gives some guide but these are long (medium) term holders thats why we did it this way.

    regards
 
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