I agree with you brett, this is again one of those news releases that is meant to set up a pump and dump. The gold price being in a bear market is not going to push it up my guess is that the pumpers are trying to load up on a short position, JAG is going down. They will have to reverse split 5:1 or so and they will still be 0.40 at the end of the year after a reverse split.
I have followed JAG for 9months and from my observations someone in the company is releasing insider info to some people before press releases come out for the public. I have no trust in the company being able to give positive returns to shareholders. The fact that they are taking the money from the loan says that they are not making enough money to fund themselves like they had expected they would be able to before gold crashed.
I would advise anyone to sell/short JAG here.
Hey Brett....speaking of terms of the deal. What does this $25M secured loan do to the holders of the $250(-) unsecured loan ?
In case things go bad - who gets paid first? Who gets paid after that ? Between the unsecured debt holders and us, lowlife common shareholders who gets paid first?
For your entertainment Brett..
Jaguar Mining Inc. Announces the Arrangement of $30 Million Credit Facility with Renvest Mercantile Bancorp Inc. Global Resource Fund
BELO HORIZONTE, Brazil, Oct. 29, 2012, 2012 (Canada NewsWire via COMTEX) --JAG - TSX/NYSE
Jaguar Mining Inc. ("Jaguar" or the "Company") (JAG: TSX/NYSE) is pleased to announce that it has arranged a $30 million standby credit facility ("the Facility") with Renvest Mercantile Bancorp Inc. ("Renvest" or "the Lender") through its Global Resource Fund. The Facility is expected to close on or before November 28, 2012 subject to completion of requisite due diligence by the Lender and the finalization of the required loan documentation. Upon closing, Jaguar will draw down US $5,000,000 from the Facility ("the Initial Drawdown").
Interest will be applied to the outstanding balance of all amounts drawn down from the Facility at a fixed rate of eleven (11%) per annum, payable monthly in arrears. In consideration for the Facility, Renvest will be paid a standby set-up fee as follows:
1. $50,000, being 1% of the value of the Initial Drawdown, payable in
cash on the closing date (concurrently with the Initial Drawdown);
2. US$250,000, being 1% of the value of the Facility less the Initial
Drawdown (i.e. 1% of US $25,000,000) on the earlier of (i) the
date upon which security over title to Jaguar's properties is
registered and delivered to the Lender, or (ii) December 28, 2012;
3. 450,000 common shares of Jaguar, payable on the closing date.
In addition, after the closing date, Jaguar will pay the Lender a monthly stand-by fee in cash, equal to 0.2% of the undrawn balance of the Facility, until the Facility is terminated, fully drawn down, or has expired.
Jaguar will be permitted, in one or more drawdowns, to draw down the balance of the Facility for a period of 12 months from the Closing Date. All drawdowns from the Facility will be fully due and payable 18 months following the Closing Date.
Jaguar will pay the Lender a drawdown fee on all drawdowns (i.e. the Initial Drawdown and all subsequent drawdowns) on the date of the respective drawdown equal to:
1. 2% of the amount of the respective drawdown payable in cash; and
2. A number of common shares of Jaguar equal to 2% of the amount of
the respective drawdown.
Jaguar will use the proceeds from any drawdown for working capital related to its Turmalina, Paciência or Caeté mining projects in Brazil.
Regarding the new facility, Jaguar's President and CEO David Petroff said, "We are pleased to have this standby facility in place as we continue to implement our restructuring and cost reduction programs. While we are making good progress, we expect this additional financial flexibility will facilitate the execution of our plans."