By Laura Lutz
Des Moines, March 3 - Firstgold Corp. raised $3.31 million from the first tranche of its previously announced $6 million private placement of units through D&D Securities Co.
The first tranche included 5,094,193 units at $0.65 each.
Each unit consists of one common share and one half-share warrant, with each whole warrant exercisable at $0.80 for 18 months.
Alongside the private placement of units, Firstgold plans to sell between $5 million and $8 million of secured convertible debentures in two tranches.
The debentures will be convertible into common shares at $0.80 per share. They will carry an 11% coupon.
The second tranche of the debentures is subject to the company delivering an engineering report on the Relief Canyon project.
Investors also will receive five-year warrants. If the full $8 million in notes are issued, Firstgold will issue the following warrants. Otherwise, the warrants will be reduced on a pro rata basis to reflect the lower amount funded.
Warrant A is exercisable for $900,000 in common stock at $1.00 per share. Warrant B is exercisable for $2.4 million in common stock at $1.25 per share. Warrant C is exercisable for $2.4 million in common stock at $1.50 per share.
Proceeds will be used to finance activities at Firstgold's Relief Canyon Mine project, for exploration activities at its leased properties and for general corporate purposes.
Firstgold is a mining company based in Cameron Park, Calif.
| Issuer: | Firstgold Corp.
|
| Issue: | Secured convertible debentures, units of one share and one half-share warrant
|
| Pricing date: | Feb. 15
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| Settlement date: | March 3 (for $3,311,225.45 of units)
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| Stock symbol: | OTCBB: FGOC
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| Stock price: | $0.66 at close Feb. 15
|
|
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| Convertible debentures
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| Amount: | $5 million (minimum), $8 million (maximum)
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| Coupon: | 11%
|
| Price: | Par
|
| Conversion price: | $0.80
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| Warrants: | For $5.7 million in common stock
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| Warrant expiration: | Five years
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| Warrant strike price: | $1.00 (for $900,000 in shares), $1.25 (for $2.4 million in shares), $1.50 (for $2.4 million in shares)
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|
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| Units
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| Amount: | $6 million
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| Price: | $0.65
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| Warrants: | One half-share warrant per unit
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| Warrant expiration: | 18 months
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| Warrant strike price: | $0.80
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| Agent: | D&D Securities Co.
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