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Bullboard - Stock Discussion Forum Oromin Explorations Ltd OLEPF

GREY:OLEPF - Post Discussion

Oromin Explorations Ltd > Badr's 13% investment....
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Post by tony1969 on Oct 16, 2012 12:23pm

Badr's 13% investment....

Hoosier you mentioned in a post on Oct 6th that Bendon and Badr will not be diluted.  I understand Bendon because they are apparently keeping up with their payments.  Badr on the other hand does not have to make any payments. 

This is from the presentation on their web site.

"Badr's carried interest is subject to recoupment of capital expenditures and funding partners sunk costs plus interest thereon."

If they do not contribute a penny then how can they keep their 13% after all of the new shares that have been issued through the years.

I believe that in order for them to keep the 13% they must as the quote says pay a certain amount of the capital expenditures that the company has incurred plus interest.

This makes sense to me.  You cannot maintain you % stake forever while contributing nothing.  Comments?

Comment by maya123ca on Oct 16, 2012 1:13pm
Tony: You are right about the value of Badr's 13% investment, but for the wrong reason. It has to with accounting principles and trying to determine the Net Present Value of an asset that will mature at some time in the future. The NPV of Badr's 13% will, in Chet's words, "not be worth much". But it isn't because they haven't paid anything, it's because the other ...more  
Comment by tony1969 on Oct 16, 2012 1:34pm
Thanks maya this then seems to be a net positive for us retail holders. Sounds a bit complicated but I take your word for it. Any idea on why the other partners have not tried to recover or recoup thier expenses? They may have decided a while back to basically phase them out and not even try and collect from them therefore increasing their corresponding stakes when a deal gets done. ...more  
Comment by hoosier1 on Oct 16, 2012 11:16pm
Tony... I see that maya answered.. Keep in mind as well that Senegal does not get its share 10%) either until all development, production, etc. cost are recouped by OLE, Bendon & Badr... basically, all profits from production of gold go first to the upfront primary holders/outlay-ers (OLE & Bendon) before anything goes to the others...protects the people who took the most ...more  
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