Diatreme Resources (ASX:DRX) has signed a $3 million convertible note facility with a private Chinese investor to advance its flagship Cyclone Zircon Project in Western Australia’s Eucla Basin.
This is key to advancing the definitive feasibility study for the project, which has a Resource of 211 million tonnes at 2.3% heavy minerals.
The $3 million facility can be drawn in $500,000 tranches over a 12-month period, with first drawdown due for late May 2015.
The notes have an attached coupon interest rate of 5.2% payable by half yearly instalments in arrears on the six month anniversary of each drawdown.
These have a term of 36 months from last note drawdown date, with provision for a further extension of 12 months at the request of the noteholder.
Half of the notes are convertible to ordinary shares at maturity at a fixed price of $0.02, or a 122% premium to its share price at the time of signing the agreement, while the rest will be redeemed at maturity.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX emerging companies with distribution in Australia, UK, North America and Hong Kong / China.