Great Basin Gold repays 2008 senior notes with upsized credit facility

By Toni Weeks

San Diego, March 16 - Great Basin Gold Ltd. has repaid its 2008 senior secured notes with the proceeds of its term loan facility from Credit Suisse AG, according to a company press release.

The facility, which was increased to $70 million from $60 million to maximize leverage, has been fully drawn down. The four-year facility is repayable in quarterly installments beginning in September and bears interest at Libor plus 375 basis points.

As part of the facility, which is secured by Great Basin's assets in Nevada, the company executed a zero-cost-collar hedging program, consisting of 117,500 ounces of gold spread over a four-year term beginning in January 2012. The call option price was fixed at $1,930 per ounce, with the put option at $1,050 per ounce. As long as gold trades within these prices, there is no cash cost to the hedge.

Great Basin Gold, based in Vancouver, B.C., explores and develops gold properties.

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