JOHANNESBURG (miningweekly.com) – Coal miner Buffalo Coal Dundee, a wholly-owned subsidiary of TSX-V- and AltX-listed Buffalo Coal, has entered into an amendment to its term loan and revolving credit facility with Investec Bank.

Pursuant to the amendment, the working capital facility under the Investec facility was increased by R16-million (about C$1.75-million) to R96-million (about C$10.5-million), with the aggregate Investec facility increasing from R220-million (about C$24-million) to R236-million (about C$26-million).

The supplemental credit is available subject to the provision of a utilisation report acceptable to the lender, with the availability period of the working capital facility having been extended to June 22.

The maturity date for any amounts drawn against the supplemental credit will be June 29, whereby Buffalo Coal Dundee will immediately repay to Investec R36.6-million (about C$4-million), which is currently due to Investec under the existing Investec facility.

Of the R36.6-million, R30-million will reduce the aggregate amount outstanding on the Investec facility from R200.3-million (about C$22-million) to R170.3-million (about C$19-million), with the remaining R6.6-million (about C$750 000) applied to the mine royalty payment in the amount of R6.1-million.

The balance of R500 000 (about C$50 000) is applied to default interest, all of which were due and payable on March 16.

The due date for the principal payment amount of R7.5-million (about C$800 000), initially due on March 31, will be extended to June 29 and Investec, Buffalo Coal noted, has agreed to not to exercise its acceleration rights with respect to any existing events of default under the Investec facility.

A technical adviser, who will provide monthly reports to Investec, will be appointed until June 30.

As a further condition to the amendment, Buffalo Coal has retained Northcott Capital as

financial adviser to conduct a review of its strategic options.

Buffalo Coal, however, cautioned that there are no guarantees that the strategic review will result in a transaction or, if a transaction is undertaken, as to its terms or timing.

Meanwhile, the company does not intend to disclose developments with respect to the strategic review process unless and until a definitive transaction or strategic option has been approved.