Ivanhoe Mines (IVN-T) has acquired another 3.78 million shares of Olympus Pacific Minerals (OYM-V), as part of a deal under which Olympus has repaid in full its US$3.75 million debt to Ivanhoe.
Also under the deal, Olympus paid US$1.32 million in cash and granted Ivanhoe a credit of US$1.43 million against present and future expenditure obligations at the Phuoc Son joint venture in Vietnam, which is held by Olympus (57.2%), Ivanhoe (32.6%) and New Zealand-based Zedex (10.2%).
To help settle the debt, Olympus used a short-term bridge loan in an aggregate amount of U.S. $765,000, arranged with Zedex, a significant shareholder of Olympus, and two other arm’s length parties. The loan bears interest at the rate of prime plus 2% annually. If the facility goes into default, the rate rises to 20% per year. The loan is repayable on demand, and must be repaid by the earlier of Resources Investment Trust remitting to Olympus US$1 million to complete the escrow requirements of a previous private placement or January 31, 2002.
Subject to regulatory approval, Olympus has agreed to issue its lenders shares equal to 20% of the amount of the short-term bridge loan at 77 per share, or, if not approved $121,000 in cash.
Ivanhoe and Zedex have agreed not sell more than 1% of Olympus’ outstanding shares during any quarter. The two have also granted each other rights of first refusal on any Olympus shares.
Be the first to comment on "Olympus settles debt"