Eastcoal to extend loan

VANCOUVER-based miner Eastcoal plans to roll over $US1.5 million of debt into a new debenture agreement with an extended maturity date.
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Courtesy of EastCoal

Justin Niessner

The miner intends to extend the payment date for half of a three-year $3 million convertible debenture that it issued to UK company Surrey Dynamics in November 2009.

The new debenture, still subject to regulatory approval, will include all accrued but unpaid interest on half of the original $3 million loan and will mature December 17, 2012.

The two companies signed a supplemental indenture Thursday amending the terms of the original arrangement and setting out the terms upon which Eastocal will issue the new debenture.

The principal of the new debenture will be convertible into common shares of Eastcoal at the price of 23c per share. The two-year debenture will bear interest at 10% per annum payable quarterly.

Eastcoal is producing coking coal from its Menzhinsky mine and developing the Verticalnaya mine, both in Ukraine.

Last month, the company extended its offtake sale agreement for Menzhinsky by 312,000 tonnes per annum.

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