Toronto-listed Greenstone Resources, together with the Emerging Markets Gold Fund, plans to raise US$10 million to fund work at its gold projects in Nicaragua and Honduras.
The funding will consist of US$5 million worth of Greenstone convertible preference shares and US$5 million worth of common shares.
The preference shares will be convertible into common shares any time between Sept. 1, 1996, and Aug. 31, 1999, at an initial rate of $3 per common share, escalating by 10% per year and adjusted quarterly. In addition, these shares will have a dividend of 6% per annum, payable in either cash or Greenstone common shares.
Alternatively, the fund can convert the investment into shares of other Greenstone operating subsidiaries, which hold interests in the Libertad and San Andres gold mines in Honduras or other projects in Nicaragua. The fund has also been granted US$5 million in options for Greenstone common shares, exercisable over the same time period as above.
Proceeds will be used to carry out exploration, metallurgical test work and environmental studies on San Andres and Libertad.
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