Cash crunch What started out as a great story has now turned out to be a catastrophic F%ck up.
Quarterly principal repayments are required commencing September 30, 2012. The total annual principal repayment required in
each fiscal year ending September 30, expressed as a percentage of the full principal amount of the credit outstanding, are: 2012
– 16.7%; 2013 – 34.6%; 2014 – 23.7%; and 2015 – 25.0%.
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, 2011 there was approximately $6,417 drawn
against these credit facilities. The credit facilities are secured by certain machinery and equipment of EMIPA. The proceeds were
used to finance EMIPA’s working capital needs.
EMIPA also has a term credit facility agreement with Banco Bisa S.A. The 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 this credit
facility. This loan is secured by certain machinery and equipment of EMIPA. The proceeds were used to finance equipment
purchases for the UMZ
On June 28, 2011, the Company announced that final approval has been received from the Spanish Ministry of the Environment
for commercial production at the EVBC Mine. A $6,581 (€5 million) cash bond was paid in August 2011, and an additional €5
million cash bond is payable in June 2012. Total funds deposited with a Spanish financial institution for reclamation bonds
amounted to $10,074 at September 30, 2011 (September 30, 2010 - $3,287).