The developer, a vehicle for most of Dubai World's overseas property investments, has proposed paying interest of 175 basis points over the London interbank offered rate (Libor) under the new terms, one banking source said.
Lenders would be paid beginning in 2014 over a period of three years and interest would be accrued from December 2011, the source said, adding that the proposed interest rate was similar to the rate on the original loan.
Limitless was involved in Dubai's corporate debt crisis in 2009 after the property market crashed. Conglomerate Dubai World transferred ownership of the firm to the government last year.
Most lenders have agreed to the new terms and a deal is imminent, said the sources, who declined to be named because of the sensitivity of the talks. They said restarting some of the company's main international projects would be key to the success of the restructuring deal.
"The restructuring pact is mainly contingent on asset sales. Most of their assets are not very liquid but Limitless can generate cash flows if their key projects in Saudi and Dubai can take off," said Ahmed Alanani, a senior executive at investment bank Exotix, which specialises in frontier markets.
The state-owned conglomerate has rolled over the loan, owed to a syndicate of banks, several times. The loan was originally due to mature in March 2010.
Limitless said in a statement private discussions were continuing with its lenders but declined to give details of the restructuring talks. However, it said Al Wasl, its $12 billion project on the outskirts of Riyadh in Saudi Arabia, would be priority project under the restructuring.
"We continue to pursue the project with our partner in Saudi Arabia. We will make further announcements at an appropriate time," Limitless said in the emailed statement.
In a separate announcement on Tuesday, the company said that it and Russian partner RDI Group had secured a 120 million dirham ($33 million), three-year financing deal with Moscow's Expobank for the continued construction of Zagorodny Kvartal, their mixed-use joint venture project near the Russian capital.
Dubai World signed a final agreement with creditors to restructure $24.9 billion in debt in March, and the emirate itself has been slowly recovering from the impact of the financial crisis thanks to a revival in trade and tourism.
Limitless, which once attempted to build a 75 kilometre inland waterway called the Arabian Canal, was excluded from Dubai World's restructuring plan, unveiled in March last year.