East Asia Minerals Corporation has provided an an update on the CAD$17.5 Million credit facility structure in cooperation with Montreal based Isatis Capital Group (ISATIS).
|Drilling Operations at the Sangihe Gold Project. Image courtesy East Asia Minerals|
Isatis has successfully completed the due diligence process for the CAD$17.5 million credit facility agreement which was announced at the beginning of June. The due diligence included a site visit to the Sangihe mine, accompanied by East Asia Minerals CEO, Terry Filbert. All lending requirements have been successfully met.
In a statement, Mr Filbert said that the funding solution enabled East Asia Minerals to move forward aggressively on plans to begin production on the Sangihe property to generate revenue and positive cash flow for the company.
“This credit facility will also enable us to begin exploration and infill drilling of the Binebase/Bawone corridor to increase both resources and reserves, as well as for general working capital. This will put the company on a fast track to increase shareholder value in a non-dilutive manner,” said Mr Filbert.
The credit facility will have a maturity of 48 months, with East Asia Minerals being able to terminate the loan at 36 months with a 2 per cent penalty on remaining money owed, and will be secured by a universal deed of hypothec over the Sangihe project in Indonesia. The loan will have an interest rate of 8 per cent and will consist of interest-only payments for the first 18 months of its tenure. The loan, at the discretion of the lender is convertible to 99.9 per cent gold bullion as a vehicle of repayment with 12 months advanced notice and contained within a formal off-take agreement.
The Sangihe gold-copper project is located on the island of Sangihe off the northern coast of Sulawesi and has an existing National Instrument 43-101 inferred mineral resource of 114,700 indicated ounces and 105,000 inferred ounces of gold. The company’s 70 per cent interest in the Sangihe mineral tenement contract of work is held through PT Tambang Mas Sangihe. The remaining 30 per cent interest in PTTMS is held by three unaffiliated Indonesian corporations. The term of the Sangihe contract of work agreement is for 30 years upon commencement of the production phase of the project.