Golden Band Resources Agrees to USD$7 Million Gold Note Financing and Launches Cdn$5 Million Flow-Through Private Placement5 minutes ago via CNW Group

GBN: TSX Venture Exchange

Golden Band Resources Inc. ("Golden Band" or the "Company") (GBN: TSXV) is pleased to announce that Sprott Asset Management LP, for and on behalf of certain managed accounts and funds ("Sprott"), has agreed to provide USD$7,000,000 in senior secured financing to assist with the development of the Company's La Ronge Gold Project (the "Senior Financing").

The Senior Financing will consist of USD$7,000,000 in senior secured gold notes (the "Notes"). As part of the Senior Financing, the Company will issue to Sprott an aggregate of 3,000,000 share purchase warrants (the "Warrants").

The Notes are secured by a first ranking charge over all assets of the Company and will be repaid through monthly cash repayments on a notional amount of 8,235 ounces of gold. Monthly repayments will begin on January 31, 2011 and be equal to the cash equivalent value (using spot prices) of the lesser of 900 ounces of gold, or any remaining portion thereof outstanding and continue on the last business day of each month until the Notes have been fully repaid. It is intended that the Notes be fully repaid on or before October 31, 2011, and, in any event, no later than December 31, 2011.

Each Warrant will be exercisable into one common share in the capital of the Company (a "Common Share") for a period of three years after closing (the "Term"). The exercise price will be set at Cdn$0.40 per Common Share during the first year of the Term and Cdn$0.50 per Common Share during the last two years of the Term.

The Company will also pay a USD$100,000 structuring fee in connection with the Senior Financing.

Golden Band also announces that it has also launched a non-brokered private-placement offerings of flow-through Common Shares and equity common shares to raise gross proceeds of Cdn$5 million to Cdn$7 million (the "Share Offerings"). Pricings of the Share Offerings have yet to be determined and will be announced at a later date.

The closing of the Senior Financing is conditional on raising a minimum of $Cdn5 million on the successful completion of the Offerings, both of which are expected to close on or about July 15, 2010, subject to receipt of all necessary regulatory approval, including approval of the TSX Venture Exchange, subject only to the usual conditions.

The Notes, the Common Shares, the Warrants and the Common Shares issuable upon exercise of the Warrants will be subject to a hold period of four months and one day from the date of closing.