TORONTO, Aug. 3, 2012 /CNW/ - Marret Resource Corp. (TSX: MAR) (the "Company") is pleased to announce that it participated in the recently announced financing commitment by a syndicate of lenders (the "Lenders") providing for the issuance of up to US $20 million in principal amount of first lien senior secured notes (the "Notes") by Xinergy Ltd. (TSX: XRG) ("Xinergy"). The financing commitment provides that the Notes would bear interest at a rate of 9.875% per annum, have a three year term and be issued at an original issue discount of 98% of face value.
The Company has committed to acquire $7,923,000 of the Notes and in consideration will receive a commitment fee of $79,230 and 396,150 common share purchase warrants with a five year term ('Warrants") and a strike price of CDN $1.20 per share. If the financing is drawn, it will also receive 198,075 Warrants with a strike price equal to 120% of the volume weighted average trading price of Xinergy's common shares for the five day period immediately prior to the Xinergy's delivery of notice its intention to draw on the facility.
Closing of the financing is subject to customary closing conditions, and issuance of the warrants is subject to Toronto Stock Exchange approval.
The current yield on the Company's portfolio was 6.51% as of August 1, 2012 and the net asset value of the common shares was $5.56. Based on the current portfolio and net asset value, should Xinergy draw on the facility, the portfolio current yield would be 7.26%.
About Xinergy Ltd.
Headquartered in Knoxville, Tennessee, Xinergy Ltd., through its wholly owned subsidiary Xinergy Corp. and its subsidiaries, is engaged in coal mining in eastern Kentucky, West Virginia and Virginia. Xinergy sells high quality thermal and metallurgical coal to electric utilities, steelmakers and industrial companies. For more information, please visit www.xinergycorp.com.
About Marret Resource Corp.
Marret Resource Corp. is focused on natural resource lending. The Company's business is primarily directed to investing in public and private debt securities of and making term loans (including bridge and mezzanine debt) to issuers in a broad range of natural resource sectors, including energy, base and precious metals and other commodities, and issuers involved in exploration and development, and may also include financing other resource‐related businesses and investing in public and private equity and quasi‐equity securities. The Company seeks to generate income mainly from its lending activities, while taking advantage of additional upside through equity participation in the companies which it finances.
Marret Asset Management Inc. is responsible for implementing Marret Resource Corp.'s investment strategy and managing its investment portfolio.
About Marret Asset Management Inc.
Marret Asset Management is an employee-owned firm based in Toronto and has over $6.0 billion of assets under management. Marret Asset Management and its experienced team of investment professionals led by Barry Allan specialize exclusively in fixed income and, particularly, in high yield debt strategies.
This news release includes certain information that may constitute "forward-looking information" under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements relating to the Company's future outlook and anticipated events or results and statements regarding the Company's future financial position, business strategy, budgets, financial results, plans and objectives and statements regarding the market and economic conditions. Forward-looking information is necessarily based upon a number of assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Such risks include, but are not limited to, market and economic conditions and the other risks identified in the Company's annual information form under the heading "Risk Factors". There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE: Marret Resource Corp.
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