shrewd management, page-12

VWman,

Extract from NXS's 28/05/09 Announcement:

"In the event that by 15 September 2009 Nexus has satisfied certain of these Completion Conditions (including obtaining third party consents) (Nexus Conditions), but AED has not satisfied the Completion Conditions within AED's control, then Nexus can either repay the deposit by 31 January 2010 without interest or retain the deposit and transfer an 11.29% interest in Longtom to AED. If by 15 September 2009 Nexus has not satisfied the Nexus Conditions, then Nexus must refund the A$35 million deposit to AED by 31 January 2010 together with interest at 15% per annum."

Source: http://www.nexusenergy.com.au/assets/97/Files/Longtom%20Announcement%20FINAL%2028May09.pdf

The 15% interest is a per annum charge and therefore will total significantly less than 15% of the deposit of $35M. In one sense it can be regarded as sort of compensation to AED from having the funds held with AED rather than in a bank or elsewhere earning interest. Similarly, AED can regard the use of the $35M as representing the cost of axcess to those funds. The rates are higher than charge by a bank but that represents the penalty for access to those funds.

Regards

SP