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Asia Entertainment & Resources Message Board

  • gallery_pup gallery_pup Apr 7, 2011 5:16 PM Flag

    Here's the Deal Summary

    Asia Entertainment proposes amendments:

    Simply stated, the bar has been raised for the issuance of the 2011 & 2012 incentive shares - this does increase or decrease the number of shares to be issued, only raises the income target ... The lock-up effectively keeps 60% of the 2010 incentive shares (approx 7.2mil) from being sold for one year ... The $60 mil founders note is now convertable into 3 mil shares.

    The message is positive as it re-aligns the incentive shares with recent guidance, provides a stock conversion vs cash payment on the founders loan and because it enhances shareholder communication.


    1. The board of directors has approved: converting the $60 mln loan from Lam and Vong, to a three-year, zero-coupon term loan, convertible into ordinary shares at $20 per share;

    2. lock-up agreements relating to 60% of the total 2010 incentive shares to be issued to management for a period of one year;

    3. and raising the 2011 incentive share target from net income of $49.5 mln to net income of $65 mln while raising the bonus share awards net income target for 2011 to $78 mln from $75 mln, and increasing the 2012 target from net income of $58 mln to $78 mln, while raising the bonus share awards net income target for 2012 to $94 mln from $82.5 mln.

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    • Is this good for the Lenders or the Company?

      Well, that's the problem. It's the same people.

      The $60 million loan previously didn't have a due date. It was tied to the company reaching a certain working capital amount. Could be a year, could be 10 years or never..interest free.....

      Now it's due in 3 years.If the stock is way up and they convert, great. But if it isn't, the $60 million is due. Such a deal.

 
AERL
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