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This is one of the best contributions to Hot Copper that I have...

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Snapper47

628 Posts.

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20/08/18

08:18

Post #: 35026721
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Originally posted by msn81 ↑

Hey All,

Over the past week a new HC member (qedpl2) has been posting information about CMY and potential options for us holders from here now that we’re in administration.

qldpl2 has been suspended as his account was very new and could be purporting to collect shareholder information for unsolicited purposes.

I’ve been in touch with qedpl2, although I believe he was not associated with CMY (not a shareholder nor management etc), I can’t quite work out what was in it for him to commence the 249D process as he suggested (perhaps he/his company could benefit from a new incoming BoD)??

Since his HC account has been suspended I have not heard from him since.

I posted to a thread qedpl2 started regarding a 249D process, trying to promote this initiative. In my opinion this would be the best outcome for current CMY holders, however it is a lot of hard work, hence I was happy to help, but for someone else to take a lead with this.

As qldpl2 has been suspended and I haven’t heard from him for a few days I’ve done a bit of research

I’m a rookie document reader and have absolutely no experience with this side of things – but I’ve put together a diagram how I can see CMY scenarios playing out:

View attachment 1241250

In this diagram
The orange route = Liquidation (IMO shareholders will get paid out approx. 0.001 per share at best).
The yellow route = DOCA + Continue trading, likely new BoD (IMO shareholders will get their shares consolidated to 1,000 to 1 at best).
The green route = 249D = Continue trading with replaced BoD (IMO shareholders will get dilution of shares approx. 60% dilution best guess).

A DOCA is a “Deed Of Company Arrangement” – basically a document that is voted/agreed by creditors on how the company can progress to come out of administration (paying off monies owed and consolidation of shares). E.g. if CMY owed a company $100, then the DOCA will spell out that they only have to repay $80 and that will settle the debt.
More Info:
https://asic.gov.au/regulatory-reso...ditors/creditors-deed-of-company-arrangement/

A Section 249D can be raised on the current BoD (I’d assume the administrators in this case?) if 5% of holders (52,439,541 shares by my calculations) group together and collectively agree to this process. It basically is a mechanism allowing shareholders to keep the BoD to account – if they don’t perform, we can vote to replace them using a 249D.
More Info:
https://www.gtlaw.com.au/insights/shareholder-activism

I’ve been in touch with:

GTT Ventures, who lead a successful 249D replacing the BoD at ASX:BKP
BRI Ferrier, the current administrators.

GTT Ventures advised it is hard work with the 249D process, and especially in our case – the shares are not trading, so in order to be successful we’d need to have support of 50% of the votes cast by existing holders (we can’t win support of new buyers, buying in/voting on the proposed new BoD). I have no idea about who holds shares in CMY and if they would support a new board or just want this thing wound up. I don’t even recall seeing a Top 20 holder list. And, further – we got to get a new BoD – new directors etc to run the show. Hence – a lot of work – something that I’m not willing to pursue myself, but happy to support. Lastly on this, if a collective we (5%) got the number for a new BoD – what are we gaining from this process? We’d be putting in the work, just to hand over the keys to new management – so this initiative suits someone who really wants to protect their (large) holding or actually wants to manage the company.

BRI Ferrier – I’ve asked Jack Li, the Point of Contact, if shareholders were to issue a 249D, who would we issue it to and what BoD are we even trying to replace? It’s a bit ambiguous in this case as the former BoD have resigned. I’ve asked them for guidance/opinion about this process just to gage whether they would encourage this or not (I assume not as they lose business liquidating the company – but they may – at least on the face value, support it ‘in the best interest of share holders’.

Anyway – why am I writing this post?

I tagged a lot of people in my first ever CMY post to drum up support – HC Admin moderated the post and closed that thread due to qedpl2 raising suspicions. I’m trying to clear my name / not raise suspicions about myself. I contacted HC Admin asking if I could repost, which HC admin did agree to and would support an action group. However qedpl2 is no longer responding and I do not have access to the email address he set up / so have no details of holders / holding size etc that may have contacted him previously.

Like I mentioned – at this point my holding is not big enough (and therefore worth) for me to pursue this 249D myself (notwithstanding I work full time) – But I’d encourage and support a passionate person who has time and effort to pursue this to step forward if they so wish.

IMO – the DOCA/Liquidation scenarios – we may as well write off our holding.

Lastly.
Access to the Creditors Report can be accessed here, there is a disclaimer saying it’s confidential, so I can’t repeat too much information in that report.
http://briferrier.com.au/about-us/current-matters/capital-mining-limited

But have a read – especially:
Sections 7 – Current Financial Position
Section 10 – Recommendation of Administrator

Cheers
MSN

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This is one of the best contributions to Hot Copper that I have seen. Certainly full of v useful information that will hopefully lead to a successful DOCA and the revival of CMY under new management with some viable projects. It will be painful nonetheless - these things always are. Becoming very clear that CMY should not have been put into administration - a very expensive exercise - v poor corporate advice.

CMY Price at posting: 0.5¢ Sentiment: Buy Disclosure: Not Held
3 Upvote

0 Great analysis

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