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I fear the end...
06-13-2018, 12:54 PM
Post: #1
I fear the end...

http://www.nautilusminerals.com/irm/PDF/...areholders

Takeaways;

1) "remaining project financing of up to US$350 million required to complete the development of the Solwara 1 Project"

2) "secured structured credit facility of up to US$34 million" from MB and Metallo

3) "All loans have a maturity date of January 8, 2019"

4) "The loans are secured against the assets of the Company through a general security agreement granted by the Company in favour of the Lender, along with a pledge of all the shares held by the Company in its subsidiary NMN."

OK.

So there's no way Nautilus is going to be able to pay back $34 million by Jan 2019 (unless some non-party investor swoops in and saves the day with a few hundred million). What does that mean? It sounds like that means MB and Metallo can sieze all assets of Nautilus.

What's stopping MB and Metallo from seizing assets of Nautilus when they can't repay the loans, and then forming a private venture with the Chinese (i.e. the shipbuilders and new owners of SMD)??

I assume assets include IP. So if MB and Metallo can seize the IP from Nautilus, and SMD (China) owns a large portion of the IP, where does that leave us?

I'm really finding it hard to understand why they would keep this company public. Everything they do (including massive lack of PR) screams privitzation.

The only thing stopping them from doing it at this point is their good graces.

This has been my worry for years. I've always conviced myself that there is no point in privatization, but now... frown

(tell me why I'm wrong!)

(p.s. damnit 5G dont you dare say share offering)

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06-13-2018, 04:00 PM
Post: #2
RE: I fear the end...

It is hard to negate your reasoning. To date 12.5 mil has been taken on the credit facilities. Ever month another 1.3 mil maybe. So, the company goes bankrupt for 20 + million come 2019? I guess management is dragging their heels on additional outside funding since the removal of exclusivity. Get a loan to pay off a loan seems like the right thing for management to do for all the shareholders. Hello PNG? Are you better off with a private company than a public one that's more accountable? Feels like collusion between the large shareholders and management when management doesn't inform at all. Anyone available to go to the AGM and shake some heads? Is management even trying to secure outside funding?

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06-13-2018, 09:49 PM (This post was last modified: 06-13-2018 10:08 PM by GGGGG.)
Post: #3
RE: I fear the end...

'woodrhino' pid='82056' datel Wrote:

It is hard to negate your reasoning. To date 12.5 mil has been taken on the credit facilities. Ever month another 1.3 mil maybe. So, the company goes bankrupt for 20 + million come 2019? I guess management is dragging their heels on additional outside funding since the removal of exclusivity. Get a loan to pay off a loan seems like the right thing for management to do for all the shareholders. Hello PNG? Are you better off with a private company than a public one that's more accountable? Feels like collusion between the large shareholders and management when management doesn't inform at all. Anyone available to go to the AGM and shake some heads? Is management even trying to secure outside funding?

I think the debt is convertible.  One possibility is the plan for the convertible debt holders is paying conversion premium getting shares.  That would mean the principles would have more or less complete control most of the company, which might be a good thing.  I am no expert on law, but if there was a bankruptcy it is conceivable there might be an outside bidder or legal delays.

I also don't understand why they went to the trouble of getting McCoach and Layman as directors if they were going to screw all the shareholders.  They could have hired them to work for the principal shareholders behind the scenes privately and secretly and without risking public embarrassment.  They put effort into putting quality people on the board, not much of a guarantee but why? 

Anglo selling is probably not a good sign, although who knows who bought them out.  I tend to think anglo sold their shares in one block to someone, although that someone might be related to the principal shareholders.

An alternative possibility is they have another share offering in 2019.  That will most likely be bought out by the 2 principles and some of the smaller shareholders that have some cash and believe.  Or they will continue to issue convertible debt. 

At the current time the main shareholders are saving Nautilus and making more progress than the past, but you can't expect them to put up their cash and expertise for nothing.  So far they have been reasonable enough with the interest rates and conversion price, although one year duration of the debt is bad I agree.

It does look like there will be working equipment in PNG early 2019.   But I can't say how the debt being due in early 2019 resolves itself.

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06-14-2018, 06:38 AM
Post: #4
RE: I fear the end...
(06-13-2018 09:49 PM)GGGGG Wrote:  

(06-13-2018 04:00 PM)woodrhino Wrote:  

It is hard to negate your reasoning. To date 12.5 mil has been taken on the credit facilities. Ever month another 1.3 mil maybe. So, the company goes bankrupt for 20 + million come 2019? I guess management is dragging their heels on additional outside funding since the removal of exclusivity. Get a loan to pay off a loan seems like the right thing for management to do for all the shareholders. Hello PNG? Are you better off with a private company than a public one that's more accountable? Feels like collusion between the large shareholders and management when management doesn't inform at all. Anyone available to go to the AGM and shake some heads? Is management even trying to secure outside funding?

I think the debt is convertible.  One possibility is the plan for the convertible debt holders is paying conversion premium getting shares.  That would mean the principles would have more or less complete control most of the company, which might be a good thing.  I am no expert on law, but if there was a bankruptcy it is conceivable there might be an outside bidder or legal delays.

I also don't understand why they went to the trouble of getting McCoach and Layman as directors if they were going to screw all the shareholders.  They could have hired them to work for the principal shareholders behind the scenes privately and secretly and without risking public embarrassment.  They put effort into putting quality people on the board, not much of a guarantee but why? 

Anglo selling is probably not a good sign, although who knows who bought them out.  I tend to think anglo sold their shares in one block to someone, although that someone might be related to the principal shareholders.

An alternative possibility is they have another share offering in 2019.  That will most likely be bought out by the 2 principles and some of the smaller shareholders that have some cash and believe.  Or they will continue to issue convertible debt. 

At the current time the main shareholders are saving Nautilus and making more progress than the past, but you can't expect them to put up their cash and expertise for nothing.  So far they have been reasonable enough with the interest rates and conversion price, although one year duration of the debt is bad I agree.

It does look like there will be working equipment in PNG early 2019.   But I can't say how the debt being due in early 2019 resolves itself.


5G. While a buyout would of course be dissapointing for all us longs, the idea of bankruptcy is what keeps me up at night. I don't have the background to know the legality of whether Nautilus could file for bankruptcy for their inability to pay back the loans, given that while the loans are funneled through a 3rd party they are made by the two largest shareholders. But that's what I fear. They file bankruptcy, creditors aquire all equipments and IP, and shareholders don't receive compensation. This isn't a rare occurrence for a public company. The twist is that the creditors are the largest shareholders, so they don't likely care if they get paid restitution for their shares in a bankruptcy proceeding since they end up owning everything anyways.

But again I don't have the background to know if this is a possible pathway. Anyone know of examples in the past of a similar occurrence?
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06-15-2018, 01:00 PM
Post: #5
RE: I fear the end...
I have to be honest. My sentiment the last few months has been that this stock is dead in the water. How many times has this forum thought "oh an announcement of financing is imminent" and we were let down every single time. I think there's an 80% chance this stock is gonna crash to the ground.

I've sold about 40% of my stake at 0.16 pps. You might ask why I don't just sell it all.. but I do have some hopes this baby will take off.

I'm very pessimistic about our chances now. Currently at 27,500 shares.. if I can get 0.16 per share, I might dump even more off. I owned 44,000 about 4 months ago.
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06-16-2018, 01:22 AM
Post: #6
RE: I fear the end...

[/quote] 5G. While a buyout would of course be dissapointing for all us longs, the idea of bankruptcy is what keeps me up at night. I don't have the background to know the legality of whether Nautilus could file for bankruptcy for their inability to pay back the loans, given that while the loans are funneled through a 3rd party they are made by the two largest shareholders. But that's what I fear. They file bankruptcy, creditors aquire all equipments and IP, and shareholders don't receive compensation. This isn't a rare occurrence for a public company. The twist is that the creditors are the largest shareholders, so they don't likely care if they get paid restitution for their shares in a bankruptcy proceeding since they end up owning everything anyways. But again I don't have the background to know if this is a possible pathway. Anyone know of examples in the past of a similar occurrence? [/quote]

Bankruptcy would be more complicated and costly in terms of time and money, so I do not think they will choose bankruptcy.  It might also mean outsiders could offer to buy Nautilus and the sale decision would be made by a Canadian judge.  But they don't have to declare bankruptcy.  More likely they will keep financing Nautilus with convertible debt.  Nautilus profits will first go to pay debt, and anything leftover goes to shareholders, who are also mostly the debt holders.  If the debt is not paid off they will print more debt, until they basically control all the shares.  I am no expert but it seems what is happening is like a Bought Deal.  It might be a good thing if the largest shareholders are also the largest bondholders.  But my point is they do not need to screw the shareholders to get majority control at a low price.       

A curiosity is why they are interested in Nautilus after the very tepid PEA?  Maybe they know it is very conservative?  Are they crazy?  Vanity? 

Bought deal financing:

https://seekingalpha.com/instablog/43449...financing/

Unpredictable is the value of the US$.  Having debt in a strong currency makes things worse.

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06-18-2018, 05:13 AM
Post: #7
RE: I fear the end...
Perhaps a bankruptcy would be risky to the JV with PNG, so maybe it not the end game? NMN may dissolve or politicians will take it as a chance for political gain and sink the JV and permits, etc. After all NMN is made of NUS shares and not DSMF. DSMF can only acquire these shares in a NUS bankruptcy. Secondly, even though no minority shareholder approval was needed for the loans and agreement with DSMF, does that allow management to knowingly harm the minority interest? I haven't read any news about attempts at other funding, so this DSMF funding seems aimed for a specific outcome even with the late in game removal of exclusivity.
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06-26-2018, 07:23 AM (This post was last modified: 06-26-2018 01:55 PM by Monk3.)
Post: #8
RE: I fear the end...

(06-13-2018 12:54 PM)KingKongFong Wrote:  

http://www.nautilusminerals.com/irm/PDF/...areholders

Takeaways;

1) "remaining project financing of up to US$350 million required to complete the development of the Solwara 1 Project"

2) "secured structured credit facility of up to US$34 million" from MB and Metallo

3) "All loans have a maturity date of January 8, 2019"

4) "The loans are secured against the assets of the Company through a general security agreement granted by the Company in favour of the Lender, along with a pledge of all the shares held by the Company in its subsidiary NMN."

OK.

So there's no way Nautilus is going to be able to pay back $34 million by Jan 2019 (unless some non-party investor swoops in and saves the day with a few hundred million). What does that mean? It sounds like that means MB and Metallo can sieze all assets of Nautilus.

What's stopping MB and Metallo from seizing assets of Nautilus when they can't repay the loans, and then forming a private venture with the Chinese (i.e. the shipbuilders and new owners of SMD)??

I assume assets include IP. So if MB and Metallo can seize the IP from Nautilus, and SMD (China) owns a large portion of the IP, where does that leave us?

I'm really finding it hard to understand why they would keep this company public. Everything they do (including massive lack of PR) screams privitzation.

The only thing stopping them from doing it at this point is their good graces.

This has been my worry for years. I've always conviced myself that there is no point in privatization, but now... frown

(tell me why I'm wrong!)

(p.s. damnit 5G dont you dare say share offering)

I fear the end of my expectations for the profit I was going for is here.  Wouldn't it have been great if they just got the bloody financing and went ahead with it? Nice and simple.  What a conveluted mess this has turn into.  #3 and #4 are very concerning but today they go and make sure that they increase and cheapen the boat load of warrants that they are getting.  Why bother if your plan is to bankrupt the company in 6 months?  If they keep the company going and the share price increases they are going to make 100's of millions off of those warrants.  I hope that is what they will do.  If not, take it private resturcture and IPO again, I'll be there with my wallet in hand day one.  Maybe they will give old shareholders a place in the IPO, at least the ones that are not signing up to sue the crap out of them in an inevitable class action if they intentionally bankrupt the company.  They have messed up on such a scale on so many occasions the class action law firms will be lined up down the street.

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06-26-2018, 11:22 AM
Post: #9
RE: I fear the end...

"interntionally bankrupt they company" Their actions Look to me like they plan on issuing more convertible debt in what amounts to a bought deal. Bankruptcy probably makes things complicated. Is there another TSX-V listed company that declared bankruptcy to allow the largest shareholders to takeover the company? The 1.2019 maturity looks provocative, but most likely they will keep issue new debt convertible at whatever the stock price is at the time.

A bigger problem in my view is copper is not holding up.  Paying back the USD loans will be tough unless the PEA is very conservative if not bogus. 

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06-26-2018, 02:12 PM
Post: #10
RE: I fear the end...

'GGGGG' pid='82087' datel Wrote:

"interntionally bankrupt they company" Their actions Look to me like they plan on issuing more convertible debt in what amounts to a bought deal. Bankruptcy probably makes things complicated. Is there another TSX-V listed company that declared bankruptcy to allow the largest shareholders to takeover the company? The 1.2019 maturity looks provocative, but most likely they will keep issue new debt convertible at whatever the stock price is at the time.

A bigger problem in my view is copper is not holding up.  Paying back the USD loans will be tough unless the PEA is very conservative if not bogus. 

NUS isn't listed on the venture exchange, it is on the TSX but I think that is just bait.  Unless I missed something, they are not issuing convertible debt on a scale that would  fund the project, the amount seems to merely keep the company alive.  Not to be antagonistic but I don't beleve commodity prices have anything to do with this company until they are in full production and even then the diversity of product that they are going to be bringing up will negate individual commodity  price fluxuations.

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