Same old same old?... Debt gets reduced but then we get another Waterton loan for $5.6M TO BE REPAID (in full!?) in July 2013 with interest "at escalating rates". This plus 'reduced' debt payments of $400K per month starting tomorrow.
Now with just a 40% interest how does GGN make $400K monthly payments and be able to save $5.6M plus some unknown interest to pay back Waterton by July 31 2013? 6 months. PLUS they are expected to make 'ongoing capital contributions' or face ownership dilution.
HOW IS THIS EVEN POSSIBLE!?
In the next 6 months GGNs 40% stake has to NET them $8M plus interest on the $5.6M... say $9M PLUS any required capital contributions?!
Is this correct?
"Waterton will advance a total of $5.6 million to Gryphon, with $3.0 million already having been advanced, to cover the Company's initial capital contributions to the joint venture which will be repaid, with interest at escalating rates, on or before July 31, 2013. Ongoing capital contributions will be determined by the board of managers of Borealis, and will be paid by both parties equal to their respective ownership interest in Borealis. If one party fails to meet a financial obligation it will be subject to dilution in their ownership interest in Borealis. In addition, if Gryphon fails to meet monthly payment obligations under the Senior Credit Facility, its interest in Borealis will be diluted in accordance with the terms of the Credit Agreement relating to the Senior Credit Facility.