The Underwriter has a wide discretion to terminate its obligations under the Underwriting Agreement on the occurrence of a number of events, which may occur before the issue of Shortfall Securities. The more significant termination events are a fall in indices event allowing the Underwriter to terminate its obligations if the All Ordinaries Index or the S&P/ASX Small Ordinaries Index falls to a level that is 10% or more below its respective level on the day before the Underwriting Agreement is executed, the Shares finish trading on ASX on any 3 consecutive days with a closing price of 3 cents or below and where an adverse change occurs in respect of the Company or its assets which has a material adverse effect. The failure of the Underwriter to appoint sub-underwriters will not relieve the Underwriter of its obligations...
If the share price falls below 3c, the underwriter can withdraw the offer. What happens then ? Renegotiate maybe ?
MNM Price at posting:
3.3¢ Sentiment: None Disclosure: Held
