Buffalo Coal Dundee Secures USD$30,000,000 From SARB
Buffalo Coal Corp. has announced that its wholly owned subsidiary, Buffalo Coal Dundee has entered into and received approval from the South African Reserve Bank (SARB) regarding a secured credit facility agreement dated November 7, 2022 and addendum to the facility agreement dated December 29, 2022 with Ikwezi Mining FZE, an affiliate of the company’s majority shareholder, Belvedere Resources.
Pursuant to the Credit Agreement, the Lender will make a credit facility available to BCD in the aggregate principal amount of USD$30,000,000, which amount may be drawn in up to ten draws under the Credit Agreement.
Interest will accrue on each Facility Advance at a rate based on the base lending rate applicable in the United States of America, as prescribed by the South African Reserve Bank (7.5% as of January 20, 2023), and each Facility Advance will become due and payable 3 years after the date such Facility Advance was advanced to BCD by the Lender.
The Credit Agreement provides for a general charge against BCD’s assets as security for the Facility Advances made thereunder, which may be prepaid by BCD on notice to the Lender in whole or in part without any penalties.
The company intends to use the initial Facility Advance under the Credit Agreement to repay amounts owing to Belvedere under the Third Amended and Restated Loan Agreement between the company and Resource Capital Fund V L.P. The remaining amounts available to BCD under the Credit Agreement will be used for general working capital purposes.
