Ann: US$35m Committed Offer of Debt Funding Secured, page-10

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dphongthai

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19/10/18

16:46

Post #: 36190933
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Originally posted by Zestfulmocha ↑

The principal loan amount outstanding can also be converted into shares in Vector, from completion of the DFS and subject to shareholder approval, with the initial US$5m Tranche 1 amount converting at a 25% premium to the Company’s 10-day VWAP share price (5 days before and 5 days after the drawdown date);

^ This will be interest to watch for, if the chose to convert to shares @25% premium to current 5 day VWAP (which if the deal was signed today and loans applied, means they'll be able to effectively buy VEC shares at 2.5-2.6c, so this will effectively be a CR at a 25% premium - which is great, excluding the fact the share price is absolutely rubbished right now, but any CR performed at these levels would probably be getting in for 18-20+ anyway... so I think this is a better option than none to have on the table, and I think hats off to Jason for securing that arrangement as opposed to a CR @ discount% approach which I guess would be considered the norm.... so the two outcomes are either a CR at a premium (great) or no dilution yet secured funding (great, but will have to repaid, soo.... CR eventually anyway?).

Will be a good outcome if they convert to shares IMO as I think it'll be a vote of confidence in what they're funding, and will prove this whole funding arrangement was just a deal for them to get a stake and at a premium - this is perhaps the benefit of having so many 'competing offers.

Just musing, I think it would be a good out come for the company, some will complain about dilution but it'll be hard to complain about the premium, so all in all, another thing I hadn't previously fully digested which I like to see.

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Zesty, this is an option for FT General to convert the debt to equity in the future. Not now, but after the DFS is done. And yes, at a premium

VEC Price at posting: 2.1¢ Sentiment: Buy Disclosure: Held
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Ann: US$35m Committed Offer of Debt Funding Secured, page-10

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