No, the 90 mm is one prong of a two prong ceiling on the net profit royalty. The part that I don't see in the APA is the % at which it is calculated. Let's say for the sake of argument that Waterton gets this project turned around in 1 year. They start making 100 million dollars net profit year in and year out. If the NPI is at 50%, then GBG, or it's assignee, gets 50 mm in year two and 40 mm in year three and then it's paid out. On the other hand, if the profit % is 5%, GBG, or it's assignee, gets 5 million in years 2 through 9 - for a total of 40 million, and then the agreement is paid out because 9 years have lapsed. We don't know if it's 5% or 50%.
The big problem right now is that whether it's 5% or 50%, Hollister isn't even close to showing profits - so when it comes CS's turn to argue to the court that this NPI is not very valuable when it's credited against their secured debt, it's going to be not a difficult argument for them to make.
