Pan Asia Corporation Ltd (ASX:PZC) is pleased to announce that it has restructured its arrangements with Ranrich Investments Limited (RRI). A Memorandum of Agreement was executed in the presence of a Notary in Jakarta on Wednesday 29th February 2012 with the parties agreeing to the following material terms:
- Repayment to Pan Asia of the amount outstanding of US4.5m on or before 14 March 2012;
- Pan Asia exchanges its right to earn a 50% interest in BCKP for a royalty of US1 per tonne on all coal sold from the BCKP IUP, limited to a total of US15m;
- Honardy Boentario will tender his resignation as a director of Pan Asia by Wednesday 7 March 2012;
- Ranrich has undertaken to deliver its current outstanding contracted shipments of 220,000MT of coal to Pan Asia's designated buyer.
Pan Asia CEO Alan Hopkins said, "This restructuring of the initial Ranrich arrangements strengthens our near term cash position and allows us to focus on our flagship TCM project which continues to shape up well".
Ranrich Investments Limited, (a company controlled by Honardy Boentario) and Innovation West Pty Ltd (IW), (a company wholly owned by Pan Asia Corporation Limited) originally entered into a Memorandum of Agreement in 2010 for the financing of and investment in various coal projects. The repayment of the finance was based on RRI making contracted coal shipments to a designated buyer arranged by IW. Since entering into the original financing arrangement, RRI has struggled to provide the scheduled coal deliveries and as a result, Pan Asia has now sought to have the principal monies outstanding under the contract repaid.