Sumatra Copper & Gold and its wholly-owned subsidiary PT Dwinad Nusa Sejahtera have executed agreements with its lenders to amend the existing US$45 million senior secured debt facility and warrants.
Agreement has also been reached with major shareholders to support the amended facility and to convert or terminate their existing convertible notes in order to acquire additional equity in the company.
The date for the required initial equity raise of a minimum of US$2.5 million has also been moved from December 30, 2016 to January 31, 2017 due to the proximity to the year-end holiday period.
In order to accommodate the delayed capital raise the company’s major shareholders, Provident Minerals Pte Ltd and PT Saratoga Investama Sedaya Tbk, have provided an additional working capital loan of US$1.375 million, under the terms of the existing Working Capital Facility Agreement which will be repaid from the proceeds of the initial equity raise.
Sumatra says the amended facility will improve the financial position of the Group by lowering the cost and amount of debt, and increasing short term cashflow.
The company has also amended its gold hedging arrangements such that 50% of the net out-of-the money value on the six monthly deliveries commencing on October 31, 2016 will be deferred, without interest, and must be repaid by June 30, 2017. The remaining 50% of the hedging arrangements will continue to be cash settled within 3 days of the due date.
Sumatra Copper & Gold is a gold and silver producer and precious metals explorer in southern Sumatra, Indonesia. Its flagship asset is the Tembang Gold-Silver Project in South Sumatra that is currently in production.
The company also has an extensive exploration portfolio with projects ranging from brownfield, near-production opportunities to strategically located greenfield holdings.