RE: Defamation by aatozz/doingthejobI have been advised that my post was not properly transcribed, this is the second effort.
doingthejob/aatozz,
The fact that I did not dispute all your rambling drivel certainly does not mean that anything you say has credence, it doesn't. My comments dealt with statements you have made that are defamatory. It would take more time than I have available to deal with every harebrained comment you make in your bashing effort.
I referred to two of your comments. You failed to comment on the "rape" accusation: "LBE is such a small blip on their radar that their investment here was only done so they could rape and hollow out LBE."
So I'll deal with your accusation: "...accruing 8% interest on current and new debt (predatory for a majority shareholder)..."
You attempt to justify your claim that interest is predatory with this inane claim: "Buddy, this is not an "unsecured" loan, as they are guaranteed to be paid not only with their controlling interest, but the established reserves that you love to quote in the SRK reports"
"
This is another classic in your lengthening list of ludicrous insights into business and financial basics. I know it's likely a waste of time, but I'll give you a few basics dealing with unsecured and secured loans, and the relevance of security on determining reasonable interest rates. A secured loan is one on which existing assets or assets acquired in the future (such as cash from future production) is pledged as security or source of repayment. In some instances, there is no such pledge of assets or future assets; thus, these loans are referred to as being unsecured. Interest rates are influenced by this basic distinction, higher rates on unsecured loans being reasonable as compensation for additional risk. The promissory notes covering Jilin Jien loans to LBE, are unsecured. The notes are not guaranteed to be paid back by the fact the lender holds controlling interest, nor from established mineral reserves, nor do the notes have any other preference over other unsecured liabilities. In the event that the company is unable to meet its commitments and becomes insolvent, these notes rank equally to any other unsecured liability. In fact if any preference was shown to repayment of these notes in expectation of insolvency, it would be considered an offence and the repayment would be recoverable for redistribution in accordance with the proper ranking of creditors. Buddy, the Jilin Jien promissory notes are unsecured. Your theory would be laughed out of Court, if your lawyer was foolish enough to fall for your input.
Actually, the 8% is anything but predatory. Considering the circumstances at the time this financing was arranged, the terms are generous and beneficial to LBE. The entire financing package was better than could be arranged elsewhere, this is supported by the fact that no other parties offered to match or better the arrangement. Your accusation of predatory rates cannot be supported by comparison to financings in the industry. I have looked at terms on loans in a number of companies; without exception there were options involved that could benefit the lender (not the case with the Jilin Jien notes), and the rates encountered were from 7.75% to 12%, and some substantially higher. The 7.75% loan was to a large mining operation, with no where near the risk involved. Perhaps you could share the data on which you based your claim that 8% is predatory?
I am amazed that if you have had 25 years business experience as you claim, that you escaped this business career with such an abysmal ignorance in business and finance basics.
So, aatozz/doingthejob, I repeat that these comments, and others are defamatory. They are the reason I am urging LBE not to tolerate any further libellous commentary from you and others; and why I suggest that other shareholders take a similar position.