Pan Asia, Kopex agree on revised debt repayment terms

By Romel S. Gurky

ASX-listed Pan Asia Corporation Limited announced Thursday that it has negotiated revised repayment terms for the debt owed by subsidiary PT Transcoal Minergy (TCM), which is guaranteed by the company, to PT Kopex Mining Contractors (Kopex) to a date beyond the original due date of November 30, 2014.

The company explained in a statement that the principal loan outstanding of US$ 2,530,000 relates to previous funding provided by Kopex on the TCM thermal coal project in South Kalimantan in respect of drilling and pre-feasibility study work. Interest of $237,600 will be paid in addition to the principal with the total amount outstanding to Kopex being $2,767,600. This interest component also covers payment for consultancy services provided by the company?s competent person, Marek Rosa (on behalf of Kopex), for the 12 month period to November 30, 2014.

The company, TCM and Kopex have agreed to the following repayment schedule:
- $1,500,000 is to be repaid to Kopex by January 15, 2015 (subject to any approvals required by the company) and no later than 30 days following this date;
- $1,267,600 is to be repaid by June 15, 2015. This second payment will accrue interest at 15 percent per annum calculated from January 15, 2015.

?Importantly, as part of the revised agreement for repayment, Kopex has rescinded its pre-emptive rights to participate in the development and production of the TCM Project including the provision of mining services, mining equipment and financing of development and production,? the Pan Asia statement said.

Further, Kopex has agreed to forgo its option to convert the loan into a 10 percent interest in the TCM Project in the event of default. Kopex has, however, retained its ability to convert any amount in default into shares in the Company at a conversion price equal to the average closing price of the shares in the 20 trading days prior to Kopex exercising the option.

Editing by Reiner Simanjuntak