Post by
hipfner on Jun 21, 2017 8:37am
Still on death watch
From the Q1 results posted on Sedar.com
Going Concern
These condensed interim consolidated financial statements are prepared under the going concern basis, which presumes the realization of assets and discharge of liabilities in the normal course of business for the foreseeable future. While management considers that the preparation of the condensed interim consolidated financial statements under the going concern basis is appropriate, there is significant doubt about the Trust's ability to continue as a going concern without securing additional financing or operating assets with adequate positive cash flow. The Trust has a working capital deficiency of $27,955,849 as at March 31, 2017 (December 31, 2016 - $29,178,113 ), an accumulated deficit of $44,810,782 as at March 31, 2017 (December 31, 2016 - $ 40,976,961 ), and the Trust reported a loss of $ 3,833,821 for the three months ended March 31, 2017 (three monthsended March 31, 2016 - $ 553,354 ). The cashflow forecasts prepared by management rely on the assumption that the operations will be profitable. The Trust did not have sufficient funds to meet the interest payments due June 30, 2016 or December 31, 2016 on the initial series of Debentures (the
“Series 1 Debentures”). The Trust received consent of the holders of Series 1 Debentures, by extraordinary resolution, for the extension of the time for payment of interest owing on the Series 1 Debentures until May 1, 2017. The Trust did not have sufficient funds to meet the interest payments due on May 1, 2017 and will seek the consent of the holders of Series 1 Debentures for a further extension of the time for payment. The Trust did not have sufficient funds to meet the interest payment due on December 31, 2016 on the Series 2 Debentures. The Trust is seeking the consent of the holders of Series 2 Debentures for an extension of the time for payment and a waiver of the event of default. The failure of the Trust to pay interest within 30 days of when it is due constitutes an event of default pursuant to the Debenture Indenture. There are no assurances that the debenture holders will grant the extensions of the time for payment or that they will not exercise their rights pursuant to the
Debenture Indenture. The Trust's ability to continue as a going concern is dependent upon the Trust's ability to raise additional capital through equity and/or debt financing and achieve profitable operations.
Should the Trust be unable to continue as a going concern, it may be unable to realize the carrying value of its assets and to meet its liabilities as they become due. The Trust believes that its current financing and acquisition plans, together with increased revenues from existing operations will provide sufficient cash flow for it to continue as a going concern for the foreseeable future, however, there can be no assurances that future revenues from operations will increase or that it will be able to raise sufficient additional funds. Accordingly, the condensed interim consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities or any other adjustments that might be necessary should the Trust be unable to continue as a going concern.
(Subsequent to this result I see they've raised more cash via a loan on which they are paying 18% a year)