Hi Guys,All interesting debate. Differing views help in our...

Hi Guys,

All interesting debate. Differing views help in our decision making. There are three things I'd like to add to the conversation:

(1) CAPITAL RAISING's HURT

IFE require (it would seem) $30m now to get their project off the ground. TRF's component would thus be $15m to retain their 50% direct interest.

Now, we don't know the ratio between debt and equity that they will be able to achieve.

A good proxy, however, is HGO which just completed a major financing deal for a FID at their Kanmantoo project - just up the road. As noted in HGO's Quarterly Activities Report yesterday, they found the financing to be much more difficult to obtain that they had anticipated and the terms more onerous. They subsequently had to undertake a majorly discounted capital raising for a higher percentage of the project.

This diluted HGO massively by 53% at a 19% discount.

Applying this to TRF, a $15m raising (assuming IFE do it as 100% equity) would mean a 41.6% dilution on TRF's yesterday's closing price.

The raising would be done at a reasonable discount to the SP as IFE/ TRF are very small companies in the greater scheme of things and the institutions will turn the thumb screws.

In HGO's case the discount was at a 19% discount to the SP at the time (ie SP 31c, cap raising at 25c). Applied to TRF this would indicate a mid 30's cap raising strike price.

In HGO's case the SP is now at the cap raising price (25c) as of today.

In addition, significant dilution at a low SP means that existing shareholders lose out on future upside in favour of the new entrants (ie what do the project metrics look like when diluted by 41.6%).

(2) AGM PRESENTATION WAS A JOKE

All I will say here is view, consecutively, BSM's and then TRF's AGM presentations, both of which were released in the past few days.

One will show you how a presentation should be delivered, one will not!

(3) MY CONTACT WITH TRF WAS UNDERWHELMING

I contacted TRF recently to offer assistance with the cap raising - not a small amount either mind you (10-15% of TRF's estimated needs). Ian only got back to me via e-mail after I followed up several times and I got a little shirty.

He fobbed me off to Ralph Winters, Commercial GM, who to date as still not contacted me despite my efforts. The three questions I needed answers to make a commitment were:

(1) Port access solutions and timelines for IO production
(2) Timelines and process (how and when) for Weednanna gold
(3) Projected terms of any/ the cap raising

Now, you could read this two ways (1) cap raising requirements largely in hand and already allocated (2) They have no clue what they are doing - even when someone approaches with a material offer. Not even to say "thanks but no thanks - buy on market".

I have made my decision about TRF, and may lose out when the SP sky rockets in a couple of weeks time on the release of the BFS, but I will take a relatively small loss now and move funds to companies that give me better confidence.

Each to their own.

Cheers
John