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Re: Olti100 post# 5330

Tuesday, 11/24/2015 4:37:59 PM

Tuesday, November 24, 2015 4:37:59 PM

Post# of 19605
Almost finished mill?

According to the expert report, the mill project needs hundreds of millions of dollars of additional financing to complete the project.

Why would anyone finance a project like this after the whole company imploded in the Chapter 11, and had to sell off all kinds of assets for tens of millions of dollars less than the 'carrying value' (price the company paid when gold was at $1,600/oz).

Properties that were sold had losses recognized on the sale of the properties, and even the ore on the pads took inventory write downs as it was discovered that the gold/silver content was not what they thought it was.

If you will recall, things were so bad on an operational aspect that the company had to stop mining ore in order to preserve cash so it could complete the reorganization.

If the company couldn't generate cash while it was in Chapter 11 and didn't have to pay bond interest or vendors, how will the company be able to operate now that it has to make some effort at repaying the debt NewCo ended up with?

My answer is that the company can't. I expect that the company will continue to lose money until gold prices rise above $1,200 and they should 'mothball' all operations and hope that gold rises in price before they run out of cash.

Louis J. Desy Jr.

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