banzai trees & hedge trimmers, page-210

Surges, I agree with your summation. Everything is pointing towards a positive outcome in the near term.

There is significant interest in ECT at the moment. There were 3.2m ESIO options traded at 0.5 cents today when these are exercisable at 2 cents per share. To me, this is an indicator that an announcement must be very close. The never ending delays regarding Monash’s commitment has been an embarrassment for management. There are conspiracy theories suggesting that this delay has been staged to ensure ECT improves its chances of receiving a bigger piece of the ALDP funding pie. I do not believe one bit of it. Having Monash on board would improve their funding application and gain interest from the wider investor community.

Why would you buy the options at 0.5 cents when you can easily buy the shares at 0.9 cents?
- The answer is that if the share price becomes anything over 4 cents, you would be gaining more on the options than the shares (noting the 2 cents strike price). This shows investors have a lot of confidence in ECT going above 4 cents should Monash deliver. Investors must believe the ALDP is in the bag, noting these options will expire in Jan 14.

Nevertheless, buying ESI shares is always a safer option as you can still hold onto your investment despite CSI delays or in the event the ALDP funding doesn’t go to plan. If Monash is going to pay 2 cents per share, there is still over 100% profit to be made imminently. I guess it depends on your risk appetite.

Let’s just say, should Monash commit just a $1m instalment at 2 cents per share by the end of this month, the share price won’t be at 0.8 cents and the options will no longer be at 0.5 cents.

A question for the ones in the know - If ESI doesn’t hold the EGM to ratify Monash’s $6m placement prior to the funding decision, does this mean ECT’s application will be unsuccessful? I presume the EGM deadline is fast approaching considering the April EGM never transpired and a May EGM looks highly unlikely.