Golden Arrow Resources (GRG.V) has signed another Memorandum of Understanding with the Argentinean drilling company which will once again take care of an extensive drill program in exchange for shares in Golden Arrow at a huge premium to the last share price. As Golden Arrow will issue just over 1.2M shares in exchange for $1.6M worth of drilling, it is essentially issuing the new shares at $1.38/share which is a 600% premium compared to the previous closing price. Another $1.2M could be used for drilling by issuing almost 900,000 shares at the same terms.
The terms of the new deal are a bit less favorable than the first payment in shares, but nobody will be complaining about issuing shares at a 600% premium. Golden Arrow estimates it can drill approximately 16,000 meter at Chinchillas and this should be sufficient to complete an extensive feasibility study on the property, which is something we have really been looking forward to.
> Click here to read the press release
Disclosure: The author holds a long position in Golden Arrow Resources. Golden Arrow is a sponsor of the website. Please see our disclaimer for current positions.
