gem funding, page-34

The cap is a huge drawback. When we want/need more funds, GEM need to sell first. Downward pressure on sp. And we certainly will need more funds.

It was probably slightly worse snowball effect than the current deal. Mainly because current deal was capped at 19.9%, and this wasn't for Novus as a "group" but each individual client. Then you had the added kicker that Booth doesn't consider his wife an assosciate. Maybe just a trophy. So she too could own some shares.

Also Booth gave the money upfront, so no pressure to sell at a loss. GEM give the money as it's drawn down. And each drawdown is automatically converted into shares. So more of a snowball effect. But Novus aint much better.

Considering the hammering sp took this week, and the general negativity. I would also be interested in the business model that impressed GEM and gives IG reason to remain positive.

Obviously they are under no obligation to share. But might provide more positive outlook.

Commonaussie, I couldn't find any links about what we were discussing last night RE: underwriter selling. Theirs a few tidbits on the net about IPO which is different and MAY have selling restrictions or escrow periods.

Escrow is sometimes forced by the asx and usually applies to vendors at IPO to prevent dumping on day 1. Restrictions are usually more to do with the underwriting agreement which we only saw the basics in the prospectus. It's possible we imposed a non-sell period.

My broker said underwriters can even sell during the "offer/sell period" provided it isn't less than the offer price. So Booth cant sell below 0.5c

But the "offer period" is closed. So really all bets are off. You can look at other examples like PNO. Their underwriter Celtic sold some immediately. This is easy to confirm in cases that the underwriter becomes a substantial holder as Celtic did, then see announcement of change in sub when he sold. So it's 100% allowed.

Looking through our prospectus again at the out clauses, their didn't seem an obvious one. Their was one about the ASX tanking but not just the GGP sp. Their was one about "new" 249D so that doesn't apply. Their was one about "new" class actions but I don't think IG have reached a point where it could be used against us. So the money looks over the line imo.

Unless Booth really wants out. Then he might use the IG as cause. Or specifically he could claim that GGP misled which is one of the out clauses disclosed in the prospectus. Then subpoena IG to disclose their case to support him.

But my understanding is he is happy to support GGP even though sp tanked. Some would say because of him.