Sumatra Copper & Gold Plc's lenders and major shareholders agreed to amend a US$45 million senior secured debt facility.
The amended facility will improve the group's financial position by lowering the cost and the amount of debt while increasing short-term cash flow, it said on Dec. 23.
The changes will reduce the interest rate to 7.5% and will convert outstanding redemption premium of about US$5.9 million into up to US$3 million of chess depository interests, or CDIs.
The remaining portion of the facility will be converted to a zero coupon unsecured loan payable upon maturity. Some 250,597,351 warrants will also be terminated under the amended terms for about US$4.1 million in CDIs.
The company will repay US$10 million of the principal amount following a minimum US$12.5 million equity raising by June 30, 2017.
Meanwhile, the ASX-listed company also agreed to convert US$7 million of convertible notes plus accrued interest to allow the lenders and shareholders to participate in the equity financing of a minimum US$2.5 million, which has been delayed to Jan. 31, 2017, from Dec. 30, due to the holidays.
Due to the delay, the company's major shareholders, Provident Minerals Pte. Ltd. and PT Saratoga Investama Sedaya Tbk., will provide an additional working capital loan of about US$1.4 million on the same terms as the June facility.
This new facility will be repaid from the proceeds of the initial equity raise.
In addition, Sumatra Copper & Gold amended its gold hedging arrangements to delay 50% of the cash value on the six monthly deliveries from Oct. 31, to be repaid by mid-2017 without interest.
The remaining 50% hedge will continue to be settled within three days of the due date.