Hi minerals:

It appears to me that AUM has little or no bargaining strength here. Management says that there will not be sufficient funds available in October to pay off the Sentient loan. Security pledged by AUM against the loan is described as follows:

The Sentient Loan is subject to customary borrower representations, warranties, covenants and default provisions and is secured by ownership in the stock of our principal subsidiaries, including the stock in the subsidiaries that own directly or indirectly the Velardena Properties and El Quevar project.

So defaulting on the repayment would appear to me to have the potential to result in Sentient taking over key assets owned by AUM which would seem to be more intrusive to management than issuing more AUM shares to Sentient. AUM appears to be in a situation being faced by any number of small miners which can't produce metal profitably at present selling prices but that have good assets that hold future profit potential if the company can remain in operation long enough. I am a Calgarian with a background in oil and gas and this is precisely the situation facing many smaller energy companies. Most are dealing with operations that are not profitable today with no idea as to when prices will recover to allow them to make any money.

Interesting times indeed.