Universal Coal plc (ASX:UNV) announced a private placement of 3,250,000 unsecured zero interest convertible loan notes at a price of AUD 1 per note for gross proceed of AUD 3,250,000 on January 25, 2014. The transaction will involve sole participation from existing investor, a Minerals Exploration & Development Fund SICAR. The company will also issue 19,500,000 warrants exercisable at AUD 0.23 per share.

The notes are convertible into ordinary shares of the company at a ratio of eight ordinary shares in respect of one loan note, up to a maximum of 26,000,000 shares. The notes are convertible at a price of AUD 0.125 per share. The company will not pay any interest on notes.

The notes will be issued immediately on payment of the amount by the investor. The notes are redeemable on the fourth anniversary of the date the issuance. The transaction has been approved by the shareholders of the company at its Extra Ordinary General Meeting.