UPDATE 1-Consolidated Thompson in $50 mln secured note deal

May 12 (Reuters) - Junior mining company Consolidated Thompson Iron Mines Ltd (CLM.TO) entered into a term sheet with Marret Asset Management Inc for a $50 million secured note facility.

The proposed facility would allow the company to draw down the amount any time before the end of this year, Consolidated said.

Chief Executive Richard Quesnel said the facility would give the miner additional financial flexibility to accelerate the capacity expansion at the Bloom Lake mine.

At the time of draw down, the company could choose the interest rates of either 15 percent per year or 10 percent per year with warrants that would create a yield of 15 percent per year.

The company agreed to issue 3.5 million share purchase warrants to the lenders with an exercise price of C$3.75 and an expiry date that is three years from the date of issue.

Consolidated Thompson shares, which have gained about 70 percent in the past three months, closed Tuesday at C$2.65 on the Toronto Stock Exchange. (Reporting by Sumedha Mukherjee in Bangalore; Editing by Anil D'Silva)