Cielo Waste Solutions Corp. V.CMC

Reposted from discussion at CEO.ca

[Migsy86]

@Lionel Good morning all! I thought I would give some clarity to today's NR, and apologies in advance for the long winded response! With respect to the valuation of the warrants, this deal was in the works for a couple of months, and then once finalized had to go through compliancy audit for the NR, among several other reviews in the process. The warrant price was negotiated into the sale, long before the recent and rapid rise of the stock, so while it looks like the deal of the century today it certainly wasn't in that same light when struck. The 5% commission is at the low end of the scale for fuel brokerage (5 to 10% is typical), and no commission on the option amount for the additional 600k liters. It's also key to note that the agreed price was at the absolute premium of market value as well, and pre-paid in advance of production, desulfurization, etc.. As you all know from previous NR's and webinars, Don was looking for short term non-dilutive term sheets to finish funding for the desulfurization, and then long term high dollar term sheets for building the Edmonton facility. Putting enough revenue on the books right now eliminates the need for the first term sheet, so there is an opportunity cost involved in making this deal as well. With higher volume sales and facility readiness attained, it also puts Cielo in a better bargaining position for the future, larger term sheets, so there is a value that can't even be measured at this time. I hope that provides a bit more insight into the recent NR.