I would like to clarify about the final payment which is the concerned
issues in the agreement right now. I wish to clarify you as follows;
1. The USD 70 M will be paid for the following purpose;
(a) To settle the IRIS Shareholders' Loan, as of the Closing Date, the Company is liable to pay back the Loan to IRIS as already recorded in the Books of the Company as Shareholders' Loan. There is no pending Loan between the Company and the Bank. But the Bank lend a loan to IRIS and IRIS re-lend this loan to the Company, the Company, and the Shareholders, then,agree to be the guarantors by mortgaged the Company's properties and pledge
the Shares. So, the Company has to pay back the Loan to IRIS and IRIS has to use this money to settle the Loan to the Bank in order to let the Bank release the mortgage and the Pledge to the Company and Shareholders respectively. This portion of money paid by Yunan directly to the Bank on behalf of the Company and IRIS. Under the books of the Company, the IRIS
Shareholders will be zero, the Yunan will become the creditor of the Company to replace IRIS.
(b) The amount paid to the Bank will be deducted to 70 Million USD,
the net amount is the price of the shares as Yunan buy from the
Shareholders(the sellers)
As they want Yunan to split the Bank Drafts into 3 draft consisting of
(i) payable to the Bank as the same amount of IRIS Shareholders' Loan.
(ii) payable to IRIS at 24 Million USD
(iii) the net amount of 70 Million - (i)-(ii) payable to Polar
The Total Payment Amount of Yunan is 70 Mil. USD, no IRIS Shareholders'Loan,(mean no any other loan pending) Yunan will become the creditors of the
company by the same amount as Yunan pay to the Banks. (YUNAN Shareholders'Loan)
Hope this clarification will help us finalize the SPA as soon as possible. We are looking for our successful cooperation.