Thread by @EnergyCredit1

Naked shorts, FINRA, the SEC, hedge funds

For $MMTLP, that is all mis/disinformation to cover up worthless assets

Meta $MMAT is telling everyone they are worthless, the $MMTLP folks just don't want to listen

1/

I feel sorry for the folks involved but this is what $MMAT - the former parent of Next Bridge thinks of these assets.

Next Bridge owes Meta $23 million and counting between principal and accrued interest

2/

That $23 million relates to 2 loans, a $15 million secured loan and $5 million + unsecured loan

The secured loan to Torchlight/Next Bridge done in Oct '21 was secured by Greg McCabe's interest in MMAT stock + his 25% interest in the Orogrande

3/

On the maturity date of the loans - March 31, 2023 - the parties to the loan extended maturity to Oct 1, 2023 and reaffirmed the security interest

4/

Reaffirmation of this lien was important to Meta as it their recourse, their collateral to foreclose on in the event they do not get repaid

5/

But we know what Meta thinks of the assets, because they tell us and are forced to evaluate the likelihood of repayment per acct rules

$MMAT is valuing the notes receivable as a "collateral-dependent" asset whereby credit losses are based on the FAIR VALUE of the collateral
6/

Per the text and table provided by Meta $MMAT, they valued the note receivable at $2.2 million at 12/31/22 and $621k on 3/31/23

7/

So after meeting and conferring with Next Bridge on the 3/31/23 amendment, where any lender would ask for private info - $MMAT determined the fair value of a loan backed by 25% of Orogrande was worth 621k

8/

Thus, Next Bridge's former parent thinks 100% of Orogrande is worth +/- $2.5 million

Not hedge funds, not shorts, not FINRA - insiders

Next Bridge was unable to convince Meta the asset is worth more

Given secured and unsec debt at NBH, this implied the equity is worth 0

9/

It is peculiar that Greg McCabe sold off a piece of the 25% interest backing the loan prior to the recent deal with NBH closing

There is NFW any lender would have allowed that

10/

The loan docs explicitly note that they are secured by 25%, not 22.6%

McCabe / NBH surely breached the loan agreement by selling off the lenders collateral (no amendment suggests he can).

11/

NBH has a claim/collateral for Wolfbone's 25% interest in Orogrande

NBH bought Wolfbone from McCabe for an equiv % of the stock of company

It would appear McCabe left NBH with an ongoing potential default by selling collateral he wasn't allowed to (per docs available)

12/

NBH is carrying assets on the books for nearly $90 million, while their lender and former parent has taken a 97% write-down on the same assets, valuing them at $2.5 million

13/

NBH has to pony up $23 million+ to $MMAT by 10/1/23

More worrisome is that w/o an amendment, they owe Greg McCabe $17 million by 6/21/23 without an amendment

Where did McCabe get the $ to lend to NBH?

He dumped $MMTLP 7 million shares to baggies b4 it stopped trading

14/

If this sounds incestuous, it is. Never seen a shareholder back a loan to a company with his own assets.

So what is way out?

Few, if any

NBH said they spent 8.4mil in capex in 1Q23

But they only had 50% WI then vs 100% now

15/

So 17mil spent drilling in 1 quarter on just a few small pokes in the ground. Lets say thats true (Im skeptical).

Suggests they need at least 40mil to drill and 40 mill to repay debt

$80 mil - where does that come from?

16/

Current share count is ~250 mil shares

Lets say they can raise at $0.40, valuing company at $100mm vs $2.5mil $MMAT thinks its worth

They need to issue 200mm shares

Current holders will be diluted by nearly 50% - or worse - just to get out of the current hole

17/

So instead of blaming shorts, FINRA, etc, etc, why are $MMTLP holders asking George Palikaras why he spun them an assets he now says is worthless (under penalty of law) and why are they not asking the current mgmt team what the plan is?

18/

NBH has filed an s-1. It is or was effective. It can start trading as soon as they issue shares and everyone can get liquidity and determine the fair value of this goat pasture

Send George and Clifton an email and get off FINRAs back

19/

My guess is the only reason holders are not doing this is they know they won't like the answer they hear

Nefarious blue sheet stories are easier to believe than accepting you were the sucker in this saga, its human nature.

end/

cc @SEC_Enforcement @FINRA

also an undisclosed related party transaction lol

ceo of nbh is ceo of mhp who torchlight did a deal with and its not disclosed he is ceo of mhp in the s-1 or 10q/k

crazy

@SEC_Enforcement $mmtlp