MUB: Bank Facility Details
February 27 -- Mongolian Resource Corporation Limited (ASX:MUB) would like to provide further details of the financing package announced on Monday 25th February. The Facility is a line of credit that is immediately available to the company ensuring MUB full solvency. Interest rate on the facility is 12% per annum over a one (1) year term.
The next choice proposed to the company from Australia was a straight loan at more than 25% interest rate. Repayment of principal is due at the end of year one (1). The bank loan is currently unsecured but the bank will review this depending on drawdown amounts and company progress. An early payout is possible with no penalty.
The board will implement a budget in line with the company situation and cash position and observing the new direction Mongolia is taking. In the interest of all shareholders, the board felt a straight debt solution was the best choice rather than a previously offered highly dilutive share issue. The board will continue to review its position for other finance including share issue as our share price recovers.
Like most Mongolian listed companies, the board sees our current low share price as reflecting Mongolia's current changes to investment environment e.g. new draft mining law etc. The company believes it has an advantage, because of its near production status, high representation of Mongolians on the board and the fact that gold prices remain high. The board will endeavour to make the most of this situation.
The next choice proposed to the company from Australia was a straight loan at more than 25% interest rate. Repayment of principal is due at the end of year one (1). The bank loan is currently unsecured but the bank will review this depending on drawdown amounts and company progress. An early payout is possible with no penalty.
The board will implement a budget in line with the company situation and cash position and observing the new direction Mongolia is taking. In the interest of all shareholders, the board felt a straight debt solution was the best choice rather than a previously offered highly dilutive share issue. The board will continue to review its position for other finance including share issue as our share price recovers.
Like most Mongolian listed companies, the board sees our current low share price as reflecting Mongolia's current changes to investment environment e.g. new draft mining law etc. The company believes it has an advantage, because of its near production status, high representation of Mongolians on the board and the fact that gold prices remain high. The board will endeavour to make the most of this situation.
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