Initial Pro Forma proceeds reduced
FIU has used 8M of the 10M credit facility in just about 1 month, there is roughly 2-3 months before the transactions would be closed, meaning that FIU will need substantially more than the 10M credit facility to continue operations. At the rate that they are burning through cash, I would project that they will need an additional minimum 5M credit facility, however, they may need more than that. Meaning that the pro forma proceeds which are now 26.6M will in all likelyhood be reduced to 20M.
"On the announcement of the Transactions on March 2, 2012, the Corporation outlined the anticipated Cash Proceeds, including an approximate Initial Distribution amount expected to be available to Shareholders on completion of the Transactions of US$36.6 million. The Cash Proceeds were subject to change due to, among other things, currency fluctuations (conversion rates were based on the Bank of Canada noon rate as of March 1, 2012), results of operations and the repayment at completion of the Transactions of all principal amounts drawn under the Gold One Loan Facility plus accrued interest thereon.
The Corporation has drawn US$8 million from the Gold One Loan Facility and expects that it will have to draw on the remaining US$2 million to sustain operations. As the Gold One Loan Facility must be repaid at the closing of the earlier of the AngloGold Transaction and the Gold One Transaction, the repayment of the loan will reduce the Initial Distribution at closing by US$10 million plus accrued interest thereon. In addition, under the terms of the Transactions, the working capital of the operations acquired must be positive, or at a minimum there must be at least sufficient cash and other current assets to fund current liabilities. If there is a further shortfall in operating performance, then such shortfall will further reduce the Initial Distribution and result in a material reduction in the cash available for distribution to Shareholders upon the closing of the Transactions".