Ann: On Market Takeover Eureka Energy Limited , page-25

re: Ann: AUT: On Market Takeover Eureka Energ... Horsa,

I think it to be project finance and heavy fees are not unusual because of the level of due diligence required. The cash fees are payable as a % of actual drawdown and EKA has the ability, if still independent, to seek shareholder approval to substitute options for the cash fees.

AUT has access to the bond market and a comparison is unfair.

When browsing to see what level of options Macquarie might require, I did come across an instance of a similar financing by them that got into trouble. I didn't bother to keep details. Sure, we have confidence in the underlying project, and there shouldn't be any problem with this financing, but banks tend to price a lending product and hope that the margin and other remuneration charged on all is adequate to cover the defaults.