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Gold/Mining/Energy : Great Basin Gold GBG.VSE (merger of Pacific Sentinel Gold) -- Ignore unavailable to you. Want to Upgrade?

To: Savant who wrote (307)	9/20/2012 3:04:23 PM
From: Goose94	Read Replies (1) \| Respond to of 317

Sept 20, '12 GREAT BASIN GOLD TO OBTAIN $35 MILLION LOAN CONSEQUENT UPON CCAA COURT ORDER Great Basin Gold Ltd. has agreed to a comprehensive term sheet from its existing bank lenders for a $35-million working capital loan which was approved as a debtor-in-possession (DIP) loan by order of the British Columbia Supreme Court pursuant to a Companies Creditors Arrangement Act (CCAA) filing made on Sept. 19, 2012 (Vancouver registry 126583). The DIP loan will be a postcommencement financing under the previously announced business rescue (BR) provisions of the South African Companies Act, which were commenced on Sept. 14, 2012. CCAA is a Canadian insolvency statute which will allow the company a period of time to seek buyers and partners for its two gold mining projects and/or corporate level financiers in an effort to return Great Basin Gold to solvency. The DIP loan has a term of six months, extendable for up to three months, and is subject to certain fees, interest and costs. It contemplates that the company will dispose or sell down its interest in its two gold projects or otherwise refinance or recapitalize over certain periods within the term of the DIP loan. The DIP loan will be subject to a superpriority lien on the assets of Great Basin Gold, and will also have the benefit of liens and claims over the assets of its Nevada and South African subsidiaries. As part of their security package for the DIP loan, the DIP lenders will also receive from Great Basin Gold's U.S. holding company a guarantee of the obligations of its South African subsidiaries' obligations under an existing South African credit facility. The DIP loan has received the lenders' credit committee approval, and it is now principally subject to negotiation and execution of definitive documentation and other customary closing conditions. The DIP loan proceeds will be used, subject to the concurrence of a business rescue practitioner in South Africa and KPMG LLP, the CCAA-appointed monitor in Canada, to affect an orderly suspension of operations at Burnstone, continuing care and maintenance of Burnstone assets, and for working capital at Hollister. Hollister is expected to continue profitably producing gold at the rate of 6,000 to 7,000 ounces per month for the foreseeable future, and no insolvency filings are currently expected for the Nevada operations.