IKN

children of an idle brain

Largo Resources (LGO.v) pays its CEO a $50,000 bonus for lending it $1m for a month

This links to my fave NR since the close yesterday, one after the bell in the evening which outlines how Largo Resources (LRO.v) is getting a $1m bridge loan from its CEO Mark Smith in order to tide it over until a debt deal gets closed with a bunch of Brazilians. But the fun bit is the terms of the bridge loan deal which include:
  • Secured on company assets.
  • One month duration at 12% interest per annum…i.e. 1% effective interest.
  • A $40,000 “establishment fee” paid to Mark Smith for being nice and writing his cheque.
In other words, he stumps up $1m for a month’s fun, guaranteed on his own company assets, and gets $50k in his pocket for his troubles. Heads I win, tails you lose.
Would it shock you to learn that the other Mark Smith company NioCorp (NB.to) was the one heavily pumped by Tommy Humphreys at CEO.ca last year? And that it’s collapsed since then? It doesn’t shock you? Oh wow…

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