http://www.scribd.com/doc/26498348/Firstgold-FGOCQ-Motion-to-Obtain-DIP-Loan
http://www.scribd.com/doc/26498348
Debtor’s are seeking to obtain a DIP loan of $350,000 at 12%. Here are some of the items of note from the filing:
“The DIP Facility provides for the extension of credit in a maximum post-petition amount of $350,000, by issuance of Gold Notes in the form attached hereto as Exhibit "A". Although the Gold Notes indicate that the total proceeds to be raised are $500,000, Debtor raised $150,000 in cash pre-petition under the Gold Notes, and requests authorization at this time to borrow an additional sum not to exceed $350,000 post-petition.
Furthermore, even though the notes are styled as Secured Exchangeable Promissory Notes they are not secured by any collateral and are in actuality unsecured notes. Due to the immediate cash needs of the Debtor, the Debtor has already obtained an additional $100,000 advance under the Gold Notes post-petition on February 4, 2010.”
“Use of Proceeds - The DIP Facility will be available to finance the Debtor's ongoing business operations, pursuant to the Cash Requirements Budget attached hereto and incorporated herewith as Exhibit "B".”
“Subject to regulatory approval, the promissory note shall be exchangeable at the option of the holder into either (i) common shares of Firstgold Corp. at a price of $0.036 cents per share or such other lower price if Firstgold should accept or issue equity at anytime before December 31 2012 at a price lower than $0.036 per share.”
“FGD has the right to call the promissory note and the gold rights. By paying 4.33 times the original promissory note amount in FGD shares at $0.036 per share with a maximum profit of $500 per ounce.”
