CALGARY, AB--(Marketwired - October 12, 2016) - Prince Resources Corporation (the "Company" or " PRC") (TSX VENTURE: PNR.H) announces that it has entered into a loan agreement (the "Loan Agreement") Sept 27, 2016 with the Company's director, Ho Yu Kuen Tammy, and the following companies affiliated with Mr. Ho (collectively the "Affiliates"): (i) Global Int'l Petrochemicals Ltd.; (ii) Global international Petrochemicals (HK) Limited; and (iii) Intellimax Capital Ltd. The Loan Agreement effectively consolidates all debts of the Company which are owing to Mr. Ho and the Affiliates. As at the date of the Loan Agreement, the aggregate of these debts is $2,280,533.17, which includes all amounts previously advanced by Mr. Ho pursuant to a Second Director's Bridge Loan Agreement dated May 2, 2012 (and predecessor agreements) (the "Director's Bridge Loan"), cash compensation owing to Mr. Ho in respect thereof (and in lieu of interest), and all additional amounts advanced by Mr. Ho and the Affiliates from time to time under no specific written agreement.
The Loan Agreement further provides that Mr. Ho or any of the Affiliates may provide additional advances to the Company from time to time for general business purposes upon the request of the Company, in which case any such advance would be included in the principal amount owing under the Loan Agreement. However, irrespective of any such request, there is no obligation on Mr. Ho or any Affiliate to advance any further amounts to the Company. As such, if any additional advances are made, they could be subject to conditions such as those customary of lending transactions. Further, in the event any additional advances are made, the Loan Agreement provides that they would be for general business purposes or as may be specified and agreed to by Mr. Ho and the Board of Directors of the Company prior thereto.
All amounts owing under the Loan Agreement are due on demand and, effective as at the date of the Loan Agreement, all such amounts will accrue interest at prime plus 3% per annum. The Company may repay all or any portion of amounts owing under the Loan Agreement prior to any demand being made without bonus or penalty.
The obligations of the Company in respect of the Loan Agreement are secured by way of a general security agreement over all present and after acquired property of the Company granted in favour of Mr. Ho and the Affiliates. The Loan Agreement does not provide for any ranking among Mr. Ho and the Affiliates in terms of the right to repayment, priority of security or realization in respect of security. Rather, the Loan Agreement provides that Mr. Ho., as a lender, is the representative acting for himself and on behalf of the Affiliates in respect of all matters thereunder (including under the related security agreement).