EXPM:HRTFF - Post by User
Comment by
GOBOGOHon Nov 15, 2020 5:02pm
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Post# 31903747
RE:RE:RE:Posts
RE:RE:RE:PostsI ran the Q3 numbers through my little financial model as well projections going to 5,000ozs per month. My analysis shows a reasonable cashflow and would confirm the companies assertion that it cashflow can cover operational costs.
I also took some time and read the credit agreements put on Sedar. A tough read and tough agreements - 14% interest going to up to 22% if payments are missed etc.
The news release said they will not have enough cash to retire the debt coming due in 2021. The agreements have a clause that covers that. For example, the debtors could convert to share at 10% or 15% discount - I don't remember the exact wording of the clauses.
That should be around the time they are trying to sell the company. So I expect that debtors to convert to shares. If you going to sell(at a good price), it better to be a shareholder then debtor.
I expect that one of the major will being willing to pay well for a 60,000 oz mine and a multi-million oz resource. I would just expect that there will be a lot more shares outstanding.
So, there is no motivation for the major shareholder to have a robust share price. I not saying that they would do anything to depress the share. it is just better for them to have a lower share price if they convert debt.
That being said, retail shareholders should do OK. It looks like the majors will be gearing up for acquisitions - their resources are dwindling and they will have tonnes of cash. It will just be a painful wait. I know the pain - I own a lot of GWA.