Business
US$5 million convertible loan facility
US$5 million convertible loan facility.
About this update from Serabi Gold Plc
[{"type":"text","content":"\n US$5 million convertible loan facilityFor immediate release31 December 2015Serabi Gold Plc(\"Serabi\" or the \"Company\")US$5 million convertible loan facilitySerabi Gold plc (AIM:SRB, TSX:SBI), the Brazilian focused gold mining and development company, announces that Fratelli Investments Limited (\"Fratelli Investments\"), the Company's major shareholder, has agreed to provide an interim unsecured short term working capital convertible loan facility of US$5 million (equivalent to approximately UK£3.3 million) (the \"Loan\") to the Company to provide additional working capital facilities.Mike Hodgson, CEO said:\"Serabi is a high grade gold producer, targeting to achieve lower than average All-in Sustaining Costs per ounce, and this is critical, faced as we are, with the recent weakness in the gold price. As with all gold producers, we are facing strong economic headwinds, all at a time whilst the Company has continuing commitments for increasing throughput through the process plant as well as development expenditure to bring the Sao Chico Mine into full production. This has restricted the Company's ability to build up its cash reserves. To ensure we can remain on track with our expansion and development plans, this convertible loan facility, kindly provided to us by our major shareholder gives the Company the ability to complete its current development programmes by the early part of the second quarter of 2016 and thus achieve optimal gold production rates as quickly as possible. We do not anticipate that it will be necessary to draw down the full extent of the convertible loan facility\".The Loan is for a period expiring on 31 January 2017 and for a maximum of US$5 million. The facility may be drawn-down in up to three separate instalments of an initial US$2 million and two further installments of US$1.5 million each. The Loan is available to be used at any time up to 30 June 2016. Interest is chargeable at the rate of 12% per annum. There is no prepayment penalty or arrangement fee. The Loan is unsecured and subordinated to the Company's existing loan facilities, including the secured loan facility arrangement provided by the Sprott Resource Lending Partnership (the outstanding balance of which amounted to US$4 million as at 22 December 2015).The first US$2 million of the Loan...