You are also right. Ok I think I know where the misunderstanding is coming from now. I think it's a misunderstanding of SPACs.
Remember guys I was a SZZL shareholder too, we redeemed. Kept the warrants. Why? Money. Greed. Capitalism. Call it what you want
@TechSpec00Just as I want to acquire CRML shares as cheap as possible, free if able, Emery would have been waiting in the wings and I'm sure others too. Assets they want, look for an angle to acquire as cheap as possible. Everyone knows the need for PIPE if too many redemptions and not enough left in the kitty. Why do you think most investors redeem? If it's financially better, why not. Risk management.
Make no mistake though, the PIPE investment was for $10 per share, Cantor and ECB receiving 1M shares as a result.
Now the tricky part... to seal this deal and get Emery to cough up more funds:
- there was a goodwill gesture from Steve to transfer Emery 2,049,000 shares free (or probably some sort of something in return off record)
- Tony/Carolyn as "Pubco" agreed as goodwill 1M additional shares + 1M attached warrants exercisable at $10 per share and expiry at the first anniversary of closing
- + 3M share only if Emery exercise all 1M warrants
Hence for $10M total 7,049,000 shares on paper... what may be a misunderstanding here is calculating this as if 7M shares was sold for just $10M. It's kind of correct but it's not the full story, it never is when it comes to capitalists looking for angle how to get the best deals. Whatever it is, it's true Emery got a good deal but it doesn't make it any less of also a good deal for PubCo. Other than whatever back door deals we don't know about (introduced me to the President or something, I really don't know) the fact is CRML raised $US20M for 9.7% of the company.
Enterprise value aside to make this deal a reality (which is awfully hard and cost a lot of legal fees) ultimately it is market capitalisation that will dictate if PIPE investors got a good deal or a bad deal (price could equally tank to $3 at IPO but it held up at $15 so that's amazing really win/win/win).
Warrant holders not subject to immediate expiry (yeah nah don't look at me I'm trying to describe the others haha) will likely look to wait if price holds up before adding more money into the coffers at $11.50 per share exercise price. So more wins! More money for CRML, cheaper shares for the likes of me. Or otherwise we acquire at your touted $3.50/share.
The important thing to note here is that there are actually people/funds who are willing and able to acquire CRML shares... obviously at the right price.
Don't be bitter if Emery appeared to acquire at a nice discount. Maybe they have maybe they haven't, we won't fully know what was agreed other than what's on paper.. the point here is they are forking out $10M and giving it to the company.
