10. Loan payable:
During the year ended June 30, 2012, in conjunction with a proposed transaction with IMC International Metalworking Companies B.V. (“IMC”) (note 13), IMC advanced $5,000,000 to Sangdong, pursuant to a term loan agreement (dated February 26, 2012), for purposes of project advancement pending the closing of the proposed transaction.
The loan bears interest at 5.00% per annum on the aggregate outstanding principal amount (including previously accrued interest) of the term loan and is payable at maturity. Total interest accrued to December 31, 2012 is $213,701.
The maturity date of the term loan is the earlier of (i) the closing of the IMC transaction and (ii) the one year anniversary of the date of the term loan agreement, being February 26, 2013.
Negotiations between the Company and IMC are ongoing with respect to an extension of the loan’s maturity date.