"Victory Park has been a great partner for us in every sense of the word. They are collaborative, creative and eager to help us find solutions. I would gladly recommend them to any company looking for a strategic capital provider to help grow their business."
– Al Goldstein, CEO
Avant Credit Corporation
ALBUQUERQUE, N.M. — Santa Fe Gold Corporation (OTCBB: SFEG), a U.S. based mining and exploration enterprise focused on gold, silver, copper and industrial minerals, today announced that it had closed a $5 million senior secured loan with Victory Park Capital Advisors, LLC (“Victory Park”), an investment firm that acts as investment manager on behalf of one or more entities. The company received net proceeds of $4,555,000 after deducting fees and expenses.
The loan bears interest at 15% per annum payable monthly in arrears. The loan matures and comes due upon the six month anniversary of the closing date or earlier upon the occurrence of an uncured event of default or of certain other events. Santa Fe may repay the loan at any time without penalty. The company paid a 5% commitment fee at closing.
The senior obligations are secured by a first priority lien on the stock of Santa Fe’s subsidiaries and on liens covering substantially all of the assets of the company, including the Summit silver-gold project, the Black Canyon mica project and the Planet micaceous iron oxide project. The senior debt contains usual and customary affirmative and negative covenants for transactions of this nature. The company agreed that any equity it raises in excess of $5 million must be applied to repayment of the loan.
In connection with the loan, Santa Fe issued warrants to purchase 500,000 shares of its common stock. The warrants have an exercise price of $1.00 per share and a term of five years.
Santa Fe will use the net proceeds for general corporate purposes, including but not limited to, working capital for the Summit silver-gold project, which is expected to reach full production during the last quarter of 2011.
Dr. W. Pierce Carson, CEO, said, “We are delighted to have completed this financing, which demonstrates confidence in the company’s assets, its management and its future.”
Dalmore Group, LLC (“Dalmore”), a registered broker dealer and member of FINRA and SIPC, acted as the exclusive agent in procuring the financing with Victory Park. The company paid Dalmore a fee of 3.5% of the gross amount of the loan.
Santa Fe Gold is a U.S. -based mining and exploration enterprise focused on acquiring and developing gold, silver, copper and industrial mineral properties. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began processing operations in 2010; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Ortiz gold property in northcentral New Mexico; (iv) the Black Canyon mica deposit and processing equipment near Phoenix, Arizona; and (v) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.
Learn more about Santa Fe Gold.