“As the Gold One loan must be repaid at the closing of the...transaction, the repayment of the loan will reduce the pro forma proceeds at closing by $10m.”
The company warned shareholders that distributions might be reduced even further:
“In addition, under the terms of the transactions, the working capital of the operations acquired must be positive, or at a minimum there must be at least sufficient cash and other current assets to fund current liabilities.
“If there is a further shortfall in operating performance, that may further reduce the pro forma proceeds and result in [a] material reduction in the cash available for distribution to shareholders at the closing of the transaction.”
https://www.miningmx.com/news/gold_and_silver/Another-blow-for-First-Uranium-shareholders.htm
***So what I'm getting out of this is that 0.11/share has become optimistic...I hadn't realized that part of the deal included "the working capital of the operations acquired must be positive, or at a minimum there must be at least sufficient cash and other current assets to fund current liabilities."
This means that it is almost 100% gauranteed that the initial pay out will be further reduced from 0.11/share, because they have already drawn down on half of the credit facility, logically they will require the rest of the credit facility to operate until the end of next quarter, however, because they need enough positive working capital to fund current liabilities, they will need a further credit facility beyond the current 10 million Gold One credit facility currently in place.
0.11/share has turned into 0.0-0.11/share initially, with another 0.0-0.11 depending on what happens to the escrow fund. Shareholders are literally being told they could get 0.0/share if they vote yes! And who wants to bet that FIU is legally responsible under the current terms of the asset sale to bring EZ up to the level it was at the time of Gold One's 70 million bid? Meaning that more money will be reduced from the initial payout to pay for EZ!
I have never heard of an asset sale where shareholders are actually essentially told that they could receive 0.0/share. Who in their right mind would vote for this deal!!!!!