Ok, forgive my ignorance on this matter as I do not claim to be a legal practitioner, however i received my AGM booklet today and there is some confusion over the DI deal.
The way I read it is this (in laymans terms):
DI arrange funding in two steps. One in end of 2008 ($30M), the other in end 2009 ($250M).
For their efforts they get 2% of funds raised or shares equivelant. If they raise $30M they get 600k etc. Plus 10,000,000 shares already) + 20,000,000 shares Tranche B and 50,000,000 shares Tranche C, issued at 25c
The part which confuses me is under the compensation clause on page 8.
In the event that the SP is under 25c then the average of the prior 20 days is taken. DI then receive 30,000,000 x ($0.25 - average sp).
So for example if SP ended up staying at 6c at end 2008. DI would recive 30,000,000 x (0.25 - 0.06) = $6.3M.
Then in end 2009 they would get 50,000,000 x ($0.25 - 2xSP)
So lets say SP is still 6c.
50,000,000 x (0.25-0.12) = $6.5M
Now forgive me if I am wrong and please let me know if I am, but that sounds like too good a compensation deal if the SP stays under 25c.
So lets say DI only generate 10M in fundraising. Could they technically walk away with $12.8M in compensation rather than their 2%???????
Would love this to be clarified before its time to vote.
Thanks PG
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