SouthGobi Resources Ltd. has executed a new deferral agreement with China Investment Corp. for a revised repayment schedule of US$20.7 million of cash interest and associated costs originally due on Dec. 19.
Under the terms, the company will repay an average of US$1.4 million per month from December 2016 to April 2017, and US$14.3 million on May 19, 2017.
In exchange for the deferral of the payments, SouthGobi will pay a fee at a rate of 6.4% per annum to China Investment, the company said Dec. 29.
At any time before the December 2016 deferral amounts are fully repaid, the company is required to consult and secure consent from China Investment before replacing or terminating either or both of its CEO and CFO, otherwise this will constitute an event of default for the convertible debenture.
In July, the company inked a deal to defer around US$26.9 million worth of debt to Dec. 19.