Liberty Mines (TSE:LBE) announced that it has entered into an MOU with Jilin Jien for funding to support the Company’s 2011 business plan and a comprehensive financial re-engineering proposal.
Liberty Mines (TSX:LBE) announced that it has entered into an MOU with Jilin Jien for funding to support the Company’s 2011 business plan and a comprehensive financial re-engineering proposal.
The press release is quoted as saying:
As part of the proposed financial re-engineering, Jien and Liberty have agreed in principal:
To consolidate all of Jien’s outstanding debt instruments, including promissory notes, credit facility, advances and accrued interest, and the $8.0 million in new advances contemplated in the MOU, totaling approximately $49.0 million as at December 31, 2010, into two secured term loans maturing 18 months and 36 months after the closing of the proposed transaction, respectively. The interest rates on the two term loans will be 10% per annum. In the first 18 months, all interest will be capitalized to lessen the cash requirements of the Company.
Jay Richardson, Interim CEOof Liberty Mines, said:
The end result is a new capital structure; one that eliminates all short term debt obligations to Jien, creates long term debt that better matches our assets and cash flow, and eliminates the uncertainties of the more generous conversion opportunities that were available to Jien. We are very excited with the prospects of Liberty and this continued support from Jien opens the door for us to execute on our future plans.”