Business
US$4.6m financing and Related Party Transaction
US$4.6m financing and Related Party Transaction.
About this update from Pacsco Limited
[{"type":"text","content":"\n \n \n RNS Number : 8367N\n Agriterra Ltd\n 26 May 2020\n \n \n \n \n The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.\n \n \n \n \n \n 26 May 2020\n \n \n Agriterra Limited ('Agriterra' or the 'Company')\n \n \n Agriterra Limited / Ticker: AGTA / Index: AIM / Sector: Agriculture\n \n \n \n \n US$4.6 million financing and Related Party Transaction\n \n \n \n Agriterra Limited, the AIM-quoted African agricultural company, is pleased to announce that its wholly-owned subsidiary, Desenvolvemento E Comercializacao Agricola Limitada (\"DECA\") has secured a c. US$4.6m working capital facility (the \"Facility\") from First Capital Bank, S.A. (the \"Bank\") to enable it to finance and secure the purchase of up to 42,000 tonnes of raw maize during the period May 2020 to August 2020 (the \"FinancedMaize\"). The Financed Maize will then be processed and sold by DECA from its facilities in Chimoio, Mozambique into the local wholesale, retail and NGO markets.\n \n The material terms of the Facility from the Bank are as follows:\n \n · Revolving overdraft facility of MZN 306m (c. US$4.6m) for 12 months\n \n · Interest rate of 85% of Mozambique Central Bank prime rate, which is currently 17.90%\n \n · Interest payment holiday for 6 months\n \n · Arrangement fees of 1.1%\n \n As a condition to providing the Facility, the Bank has required that the Company provide a cash backed guarantee as security (the \"Bank Security\"). In order to satisfy this condition, the Company has entered into an agreement with Magister Investments Limited (\"Magister\"), the Company's 50.01 per cent. shareholder, pursuant to which Magister has agreed to provide the necessary security (the \"Magister Guarantee\").\n \n The material terms of the Magister Guarantee are as follows:\n \n \n · Agriterra will pay Magister a fee of 1.75% of the total facility amount (the \"Guarantee Fee\") being US$80,500 shortly after entering into the Facility/Magister Guarantee.\n \n \n · Provision of the Magister Guarantee by Magister is subject to the prior and ongoing satisfaction of the certain revenue a...