VANCOUVER, Oct. 1, 2012 /CNW/ - Jazz Resources Inc. (TSXV: JZR) announces that it has renegotiated the terms of certain amounts due to shareholders by the Company amounting to $635,505 as of the financial year ended June 30, 2012. The loans and amounts due were formerly unsecured, non-interest bearing and without fixed terms of repayment and under the terms of new loan agreements will now be reclassified as long-term loans bearing interest at a rate of 5% per annum compounded annually and becoming due and payable on or before June 30, 2015. The reclassification of the debt from short term liabilities to long term liabilities will effectively reduce the Company's current working capital deficiency and provide the Company with a fixed term for repayment of the debt.
Two directors of the Company are directly or indirectly parties to the new loan agreements. Mr. Douglas Philip, a director of the Company, has advanced a total of $324,300 to the Company for the period ended June 30, 2012. Glen Developments Ltd., a corporation owned by Mr. Bryan Glen, a director and the Chief Executive Officer of the Company, has advanced loans or accrued management fees owed by the Company totaling $311,205 for the period ending June 30, 2012.
The amendments to the credit arrangements with the directors constitute a related party transaction pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions but are exempt from any minority shareholder approval requirements. The fair market value of the interest to be paid on the loans, insofar as it involves the payment to non-arm's length parties (approximately $100,171), does not exceed 25% of the Company's market capitalization, and the transaction is an amendment to the terms of credit arrangements that are provided on reasonable commercial terms that are not less advantageous to the Company than if they were obtained from a person dealing at arm's length with the Company. The new loans remain unsecured, are not convertible into or repayable in equity or voting securities of the Company, and no bonus shares or bonus warrants will be issued in connection with the loans.
The loans agreements are subject to acceptance by the TSX Venture Exchange.
About Jazz Resources Inc.
Jazz Resources is a junior resource mining company focused on acquiring, exploring, and developing mineral properties. The objective of the Company is to carry out its exploration program on the Teddy Glacier, Spider Mine, and Burniere properties located in the Revelstoke mining district of B.C. Canada.
On behalf of the Board of Directors,
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release may contain forward-looking statements. All statements, other than statements of historical fact, constitute "forward-looking statements" and include any information that addresses activities, events or developments that the Company believes, expects or anticipates will or may occur in the future including the Company's strategy, plans or future financial or operating performance and other statements that express management's expectations or estimates of future performance.
All such forward-looking information and statements are based on certain assumptions and analyses made by the Company's management in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. These statements, however, are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed, implied by or projected in the forward-looking information or statements. Important factors that could cause actual results to differ from these forward-looking statements include but are not limited to: risks related to the exploration and potential development of the Company's projects, the actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of gold, as well as those factors discussed in the sections relating to risk factors of the Company set out in certain of the Company's disclosure documents filed on SEDAR.
There can be no assurance that any forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place any undue reliance on forward-looking information or statements. Except as required by law, the Company does not intend to revise or update these forward-looking statements after the date of this document or to revise them to reflect the occurrence of future unanticipated events.
SOURCE: Jazz Resources Inc.
For further information:
JAZZ RESOURCES INC.
2394 W. Broadway
Vancouver, BC V6K 2E5
Telephone: 604 733-4830
Fax: (604) 736-8584
Email: [email protected]