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EACOM Timber Corporation Announces $40 million Secured Debenture Financing backed by Fairfax Financial Holdings Limited and Lansdowne UK Strategic Investment Master Fund Limited
MONTRÉAL AND VANCOUVER, March 27, 2012 /CNW/ - EACOM Timber Corporation (TSXV: ETR) ("...
About this update from Etruscus Resources Corp.
[{"type":"text","content":"\n\n\n\n\n\nMONTRÉAL AND VANCOUVER, March 27, 2012 /CNW/ - EACOM Timber Corporation\n (TSXV: ETR) (\"EACOM\", or the \"Company\") today announced that it has\n entered into a binding agreement for a $40 million secured debenture\n financing (the \"Debentures\") backed by Fairfax Financial Holdings\n Limited and Lansdowne UK Strategic Investment Master Fund Limited. \n Fairfax has agreed to purchase $33 million of the Debentures and may\n assign a portion of the offering to other purchasers, at its option,\n prior to closing. Lansdowne will acquire $7 million of the Debentures. \n The transaction is expected to close on or before April 11, 2012 and is\n subject to TSX-V approval and the negotiation and  execution of\n definitive documentation.\n\n\nThe Debentures will be issued at par, will be secured by all of the\n assets of the Company excluding working capital, will have a 5 year\n term and will bear interest at a rate of 10%, payable semi-annually. \n The principal is due on the expiration of the term.  The interest rate\n is subject to increase to 15% if certain corporate milestones are not\n reached.  The Debentures will contain covenants consistent with a\n secured borrowing including: to maintain the security and its priority,\n not to sell any fixed assets covered by the Debentures' security unless\n replaced by equivalent fixed assets or improvements to fixed assets,\n limitation on further indebtedness, guarantees and obligations, other\n than an asset-backed credit facility on terms acceptable to the holders\n of the Debentures and reasonable guarantees given by the Corporation to\n governments related to timber rights; no further granting of security\n on the assets secured by the Debentures subject to standard limited\n exceptions; and capital restrictions relating to dividends and\n repurchases.\n\n\nThe net proceeds will be used for general corporate purposes.\n\n\nThe Debentures will have detachable warrants (the 'Warrants\").  An\n aggregate of 200 million warrants will be issued having a five year\n term and an exercise price of $0.20 per common share. The Warrants will\n permit a cashless exercise, at the option of the holder, and are\n transferable subject to TSX-V approval. The purchasers will receive\n 5,000 warrants for each $1,000 principal amount of Debentures\n p...