July 12, 2010 (FinancialWire) (Go to http://www.financialwire.net/?s=ftrdnwswnd for all of today’s featured news.) — Magma Energy Corp. (TSX: MXY) (OTC: MGMXF) said it has entered into a credit agreement with Ross Beaty, the company's chairman and chief executive officer, under which Magma is able to borrow up to $10 million to pay amounts coming due by the company to Geysir Green Energy ehf respecting the acquisition of shares of HS Orka hf, and to fund general working capital requirements of the company.

Magma said that any advances under the credit agreement are repayable on the earlier of twelve months from the date of the initial advance, a change of control of the company or on a default by the company.

Interest at the rate of 8% per annum, compounded daily, is payable monthly commencing on July 30, 2010. In addition, a standby fee in the amount of 1% of the credit facility and a drawdown fee in the amount of 1.5% of the amount advanced is payable in cash.

Canada-based Magma Energy is a geothermal power company that operates, develops, explores and acquires geothermal energy projects. It has a portfolio of properties throughout the western United States, Iceland and Latin America, including one operating power plant in Nevada and a significant interest in two in Iceland.

Iceland-based HS Orka is a privately owned energy company producing 9% of the country's power needs. Installed geothermal power capacity is 175 megawatts from the Svartsengi and Reykjanes power plants.

In addition, HS Orka generates 150 MW of thermal energy for district heating. Expansions are planned that will increase HS Orka's geothermal power production to 405 MW by 2016.

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