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Reliance Weaving Mills to invest Rs5bn in Fatima Energy Limited

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March 11, 2022 (MLN): The shareholders Reliance Weaving Mills Limited have resolved to invest in Fatima Energy Limited (FEL) as a long-term loan/advance aggregating to an amount up to Rs5,000 million, the company’s filing on bourse showed today.

In addition, shareholders also resolved to execute Sponsors Support Arrangement and other Agreements thereto with respective lenders of FEL, other Sponsors and FEL, for the purposes of continuing Project Support to FEL.

“The Company be, is and remain authorized, to continue as one of the Sponsors of FEL, to invest the balance amount of up to Rs4,236.221 million from the approved limits pursuant to the terms of the Company's Agreements, by way of a subordinated loan in a lump sum or in parts, at a mark-up chargeable at the rate the higher of (a) KIBOR + 2.50%; or (b) a rate not less than the borrowing cost of the Company, in such case and manner as provided in the Company's Agreements and Authorized Instruments,” the notice said.

Upon conversion of loan/advance of up to Rs5,000 million into Preference Shares of FEL, such equity investment (a quasi-equity) post-conversion is also approved to the same extent, provided that the total investment by way of loan/advance and Preference shares shall not exceed Rs5,000 million, it added.

The investment (directly through cash and/or by way of convertible loan/advance as approved above) shall be done directly against the rights offer from FEL and/or by subscribing to any un-subscribed portion of rights offered to the Company, in a manner as approved by the Board of Directors in the best interest of the Company.

The meeting further approved the terms and conditions attached to Preference Shares as stipulated in a statement of material facts.

Each of the aforesaid resolutions shall remain valid and in full force and effect, until the Company's obligations are discharged under Company's Agreements or until it is revoked or amended by another resolution, notice showed.

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Posted on: 2022-03-11T17:01:01+05:00

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