Loan/8k explained for those of you that have missed it!
This is nothing more than something called a "Blanket Lien"...dont read into it to much! The amount of money being loaned is significant (approx 65 mill). Now the Lily Group can fully back that amount, but not with tangble assets "Right Now"...Other known as unrealized cash flow, however it is there and in the ground and through the continuation of mining will easly acheive a high rate of cash flow (liguid realized) in the near future. a Blanket Lien is done in a situation like this...In fact extreamly common...Its very similar to collateral, an insurance policy for the lender, so they are protected on all fronts! They are not giving away anything, the Lily Group is simply loaning 45% of the company to the lender in return for $65 mill in funding...They are loaning each other something. There are NO Shares involved here..there can be NO dilution! The idea that the loan can be paid off and buy back assets at fair market value...is slightly understated, details to buy back will most likely be in the next 8k should this loan come to fruition..There is NO way the company would agree to unlimited $$ for buy back...most loans like this will come with term limits, such as, the lender shall not recieve more than ...or less than, at a par value of X...bottom line, the company would not take $65 mill to have to pay back/or buy back $200 mill in assets (example).
Hope this helps! Hard as hell to explain, but none the less a far better deal for the company than the previous deal!
Also keep in mind...that the 45% stake is in "Lily Group", Not in the Landree Mine (VHGI)..Both are separate from one another, but under the same roof!
VHGI
MS
AI
