Cross Border Resources, Inc. (XBOR)

[Ed Ajootian]

For a Cross Border shareholder, I'm not sure that RDMP's financing struggles are necessarily a bad thing. This $4M note that comes due in 2 weeks is secured by the following assets:

"The promissory note is the Company’s senior obligation and is secured by: (i) second priority real property liens against its Villarreal, Frost Bank, Resendez and La Duquesa properties; (ii) a first priority real property lien against all of its then existing properties; and (iii) a stock pledge agreement with the Lenders, dated November 30, 2011, with respect to a second lien on 2,136,164 shares of Cross Border common stock owned by the Company."

So if RDMP defaults, 2.1M of their XBOR shares are at risk of getting transferred to the lenders and sold. Of all the assets included as collateral, the XBOR shares are clearly the most easily marketable and proceeds from their sale would probably pay off the large bulk of the balance due. Also I believe some of the other debt (one loan of which Alan B. himself has guaranteed) becomes immediately payable if they default on this note. If all this happens I believe it would force RDMP to completely change its strategy with respect to its XBOR holdings, and perhaps induce them to just sell off their entire XBOR position. XBOR shareholders would benefit tremendously if this company were sold off at auction IMO, even if it were pursuant to a debt default by its majority owner.

Curious what your thoughts are on this Boomer.