Ann: Altech - Launch of German Project Equity Strategy, page-54

Hi Troyus,
I see that the $10000 spoiler clause for AAM to cancel any buyback clause as a positive. In an ideal world it would be great for ATC to be able to buy back the potential 49% ownership of the project from AAM under all circumstances. The reality is this clause gives the AAM shareholders a guaranteed return of 15% for 6 years with the possibility, if the project performs, of an even greater return than that. Remember ATC has been trying to get equity partners on board for at least 12 months without success. In my view the main reason they have not succeeded is risk. Investors with big pockets have not jumped aboard because of risks that they identify, for example, mezzanine finance not finalised, project is a new approach, so not proven, albeit that Kfw Ipex Bank and Macquarie have now both ticked the technical side of the project, HPA is a product that many are not familiar with, price of HPA is not very transparent, etc, etc. A few too may unknowns and risks?

Providing a guaranteed return is a clever way of reducing financial risk for big investors who have looked at the project previously and not committed. I'm hoping they get at least the minimum 20 million EUR capital raise that AAM needs for the go ahead clauses to be satisfied.