Vancouver's Great Basin Gold Ltd. (TSX:GBG) has raised US$51 million in a senior secured note offering.
Proceeds of the financing will be used to acquire and refurbish the Esmeralda mine and mill it bought from Metallic Ventures Gold Inc. on December 8. About $15 million will be used to fund its Burnstone project in South Africa while the company is negotiating its project funding facility for the project.
The company sold 51,500 units each consisting of US$1,000 in senior secured notes and 350 share purchase warrants. Each warrant entitles the holder the right to buy one common share at $1.80 on or before December 12, 2011.
Each note matures at 120% of the principal on or before December 12, 2011, and will bear interest of 14% per annum with the first 24 months of interest prepaid to the buyer. Each note is guaranteed by all of the company's Nevada subsidiaries and secured by their assets.
Great Basin has also entered into an equity line agreement with an affiliate of Investec Ltd. The agreement gives Investec the right to buy up to four million Great Basin shares over the next 30 days at a 5% discount to the average market price. That deal is subject to a $1 per share floor price.
Great Basin's share price range during the past week: between $1.29 and $1.63; 52-week high: $3.83; 52-week low: $0.91.