San Gold to redeem $9.94-million in debentures
Ticker Symbol: C:SGR

San Gold to redeem $9.94-million in debentures

San Gold Corp (C:SGR)
Shares Issued 259,205,812
Last Close 9/24/2009 $2.82
Friday September 25 2009 - News Release

Mr. Dale Ginn reports

SAN GOLD CORPORATION ANNOUNCES REDEMPTION OF DEBENTURES

San Gold Corp. intends to redeem all $9,944,000 principal amount of three-year 10 per cent senior secured convertible redeemable debentures of the corporation which are currently issued and outstanding. Effective Oct. 30, 2009, the corporation will pay a redemption price of either $1,083.01 or $1,077.81 for each $1,000 principal amount of debentures, depending on whether the debentures were issued on Dec. 31, 2008 or Jan. 19, 2009. The redemption price is equal to the principal and all accrued and unpaid interest on the debentures up to but excluding the redemption date. The total redemption price will be paid to holders upon presentation and surrender of the debentures called for redemption. Interest on the debentures will cease to be payable from and after the redemption date.

Holders of debentures have the option to convert their debentures into common shares of the corporation at a price of $1.40 per common share. Holders of debentures also have the option to convert the outstanding interest owing on their debentures into common shares at the market price of the common shares as at the date of redemption. The corporation expects that a majority of the holders of debentures will elect to convert their debentures into common shares due to the fact that the common shares are currently trading at significantly above the conversion price.

The corporation is undertaking the redemption in order to reduce remaining corporate debt and related interest expense to strengthen the balance sheet of the corporation.

A formal notice and instructions for the redemption of the debentures will be forwarded to holders of debentures in accordance with the provisions of the trust indenture governing the debentures.

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