RE: Short term loans for the UMZ From the MDA for the year ended September 30, 2010
During the 2010 fiscal year, EMIPA entered into short-term, 150-day credit facilities in Bolivianos with Banco de Credito de Bolivia and Banco Bisa at annual interest rates ranging from 4% to 6%. At September 30, 2010 there was approximately $3,049 drawn against these credit facilities. These credit facilities are also secured by certain machinery and equipment of EMIPA. The proceeds were used to finance working capital needs.
EMIPA has two term credit facility agreements with Banco Bisa S.A. The first facility bears interest at 7.75% and is payable in equal quarterly installments over a three-year period maturing in March 2011. The second facility bears interest at 7.8% and is payable in equal quarterly installments over a three-year term maturing in September 2012. There are no specific covenants related to these credit facilities. Both loans are secured by certain machinery and equipment of EMIPA. The proceeds were used to finance equipment purchases for the UMZ.
Not a surprise at all then. Appears to be standard loans that they repay as they go.