news out Investors on bullboards are wondering how a company get raise financing by issuing secured Debentures. Most companies issue non secured debentures.
Sphere is issuing secured debentures at 6.5 % interest for 5 years. If the company fails too prove a resource the debt holders can take the companies properties, cash, mining lease titles and good will.
Lets discuss this aspect but first why 10,000,000 fund raising.
Lets go the press release April 11 2012 on SPAG board
Gravity Survey on Poker flats suggests open pitable gold targets
similar to Newmont Emigrant Mine where they discovered 1.6 million oz
goes on too say two defined targets
Red lake they did hit gold when they drilled.
Since then Sphere has did more work to define drill targets and a drill program on Poker flats
this tells me two things they have found gold, and know where to drill but required financing of millions in order to get a decent drill program going on two properties, and to advertise the company to get investors lined up.
If gold is going to 3500 an oz as some might suggest greed alone will sell the debentures.
But the recent news release is sure good news for Sphere investors, MNV investors, Spartan gold investors because it means they are finally going to try and prove this resource and prove the properties have value.