If there is a takeover of Kidman, can the JV be terminated?
Please see below information from the announcement.
As an advance on the proposed joint venture expenditure contribution, SQM will provide a US$21.5 million (A$28.67 million) convertible loan facility to Kidman following execution of the formal documentation to allow the project to continue to be advanced as quickly as possible until all outstanding conditions precedent to implementation of the JV have been satisfied. In the event these conditions precedent are not met within 2 years from signing of the definitive documents, the parties may elect to extend the period for satisfaction of the conditions precedent or discontinue the JV. If the period for satisfaction of the conditions precedent is extended, SQM will provide further funding of US$10 million (A$13.33 million). If the JV is discontinued, Kidman can satisfy its obligations to repay the convertible loan by the issue of KDR shares priced at a 10 day VWAP for the 10 trading days prior to the binding letter of agreement.
What are your opinions?
DYOR
KDR Price at posting:
62.5¢ Sentiment: Hold Disclosure: Held
