Narrative
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Project narrative
On August 23, 2018, A-Cap Energy Limited — a Australia-headquartered minerals exploration and development company listed on the Australian Securities Exchange, Frankfurt Stock Exchange, and the Botswana Stock Exchange with its largest shareholders being Chinese companies Jiangsu Shengan Resources Group Co Ltd (41.04% stake) and Ansheng Investment Co Ltd (19.78% stake) — began a bank loan application process with the Industrial and Commercial Bank of China (ICBC) for the provision of a loan up to $9 million USD to fund operations and support the implementation of its minerals strategy; the loan process required A-Cap to open a Free Trade Account for Non-Residents (FTN) in the Shanghai Free Trade Zone. Jiangsu Shengan Resources Group Co., Ltd. pledged to provide a third-party bank guarantee to ICBC as the loan's security interest required by ICBC over the full term of the loan Then, on October 24, 2018, the Shanghai Hongqiao Branch of ICBC entered into a $3 million USD revolving credit facility (RCF) agreement with A-Cap Energy Limited to fund operations. This loan carried a maturity period of three years (36 months from withdrawal date) and an interest rate of 6-month LIBOR plus a margin of 1.8%. This loan carried an overdue penalty rate of the borrowing rate plus 40%, and, if the borrower changed the purpose for the loan, the interest rate would be the borrowing rate plus 70%. Interest payments would be required six months in advance. The loan repayment was scheduled so that $100,000 USD would need to repaid by December 20, 2020 (a grace period of 2.167 years) and $2,900,000 USD by October 16, 2021. If the loan was repaid early, a 1% early repayment fee shall apply for each month remaining the loan unless the loan was repaid during the last month of the term. Jiangsu Shengan Resources Group provided a third-party cash collateralized bank guarantee to ICBC worth $3 million USD. On February 15, 2019, ICBC approved A-Cap's application for a drawdown of $2 million USD ($2.8 million AUD) from the RCF. The drawdown was intended for working capital and operational purposes and was issued on February 19, 2019. It had a maturity period of three years, an interest rate of 6-month LIBOR plus a margin of 2%, and a loan repayment schedule of $100,000 USD by November 10, 2021 and $1,900,000 USD by February 12, 2022.