Debenture-holders have approved a restructuring plan for Princeton Mining (TSE), thereby paving the way for the company to eliminate its long-term debt.
Holders of the company’s $12 million in convertible debentures agreed to convert each $1,000 in principal into 1,818 common shares plus 91 shares, to cover interest which was due Sept. 30.
Also, for each $1,000 in principal, debenture-holders will receive 182 share purchase warrants exercisable at 80 cents per share over three years. The conversion is expected to be approved by shareholders at a meeting on Nov. 5. On completion of the restructuring, Princeton will have 58.8 million shares outstanding, up from the current 35.9 million.
The conversion will eliminate all long-term debt except for the $2.7 million owed by subsidiary Teranov Mining. That debt will be eliminated once Teranov is sold to Black Hill Minerals.
Besides approving the debenture-share exchange, Princeton shareholders will be asked to approve a plan to raise more funds through private placements over the next 12 months.
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