I personally say “extends” and I thought the C# spec uses that word as well somewhere (I can’t find it now, unfortunately) – but I remember Eric Lippert saying he wasn’t keen on it, and wanted to change it for 4.0.
I think it’s good, because it shows that you’re extending the contract specified by the original interface.
EDIT: Having looked at the 3.0 spec…
The spec sort of side-steps the issue in section 13.2. It talks about the members being inherited from the base interfaces. It talks about one class extending another, but not interfaces
EDIT: In the C# 5 spec, section 13.1.4, it uses inherits:
An interface can inherit from zero or more interface types
So that’s probably the best term to use.