Takeover, page-5

Surandy70.

This is from Hartley in January and would be why no takeover from anyone.


We expect EGO to refinance the A$15.1m in debt currently outstanding with ERM Power (ERM). The current debt facility is interest free and due in August 2016 but carries an escalation clause should the EGO share price appreciate above 80cps.
“Under this mechanism, EGO will increase the amount it pays to ERM on top of the $15.1 million by a percentage equal to 70 per cent of the percentage increase in EGO’s share price. For example, if EGO’s share price increases by 50 per cent, EGO will increase the amount it pays to ERM by 70 per cent of 50 per cent, or 35 per cent. This would result in an additional payment to ERM of $5.7 million. This means that the final amount ERM receives from EGO for these assets is closely aligned to EGO’s success.”