From theJuly quarterly, there is $3,820k cash at bank.We...

From theJuly quarterly, there is $3,820k cash at bank.

We havedrawn down $2,500k on the Investec loan, have an expected cash outflow for thenext quarter of $1,630k (not sure if that includes all deal promotion and EGMcosts) and owe $885k to the ATO. I’m not sure if HAV has other creditors or similar liabilities, but I have assumed there are none but that would be best case.

This meansthat on repayment of known debts, there is deficiency of $1,195k.

Per page 3and slide 6 of the “Transformational” announcement, only $2M of the initial $6Mis to be used on corporate expenses. The remainder is for “agreed work programs on the Projects” (table on page 13 of EGM notice). I previously thought the whole of the $6M was HAV’s to use at their discretion.

This meansthat post GFG deal, HAV might only have $805k ($2M less deficiency of $1,195k) in which to fund all its usualexpenses and those not related to the GFG Iron/Copper Projects.

I acceptthat there is $8,000k of “Conditional funding (if requested by the Company)”that can be used “To fund general corporate costs, tenement administration,Kalkaroo Station and discretionary exploration (if requested)” (page 14 of EGMnotice).

However, Ican’t see this amount lasting the 3 to 5 years it is going to take to completethe agreed scope of works.

Therefore, inmy opinion, HAV is going to need to do a capital raising even if there is a YESvote.

I also don’tlike how the “Conditional funding (if requested by the Company)” has beenpromoted. Now I understand that HAV can’t use all of the $6M it gets up front as it wishes, it means that HAV MUST use this “Conditional if requested” funding or do an immediate capital raising.

Also, whathappens if the Conditional Funding tap is turned off if HAV misses a milestone?

For anyonethinking of voting YES because it will avoid a further capital raising, pleasethink again.