CuDeco Ltd. said April 3 that it signed an agreement with Gemstone 101 Ltd. for a A$22 million convertible note facility, under which CuDeco will issue 44 million notes convertible into 44 million common CuDeco shares.
The 24-month facility will bear a 6% interest per annum and will be convertible into CuDeco shares at any time during the facility's term, at the lender's discretion, at an exercise price of 50 cents per share.
CuDeco expects to complete the transaction 12 business days from the March 31 agreement or such other date set by the parties. Proceeds are earmarked for the repayment of CuDeco's bank loans owed to China Minsheng Banking Corp.
Gemstone 101 will also be entitled to receive 4.4 million free options after completion, exercisable at 80 cents each during the facility's term. The new investor will also be allowed to have a representative on CuDeco's board should its stake in the miner exceed 7%.