I guess this explains Infinito:

Infinito Arranges $18,000,000 Convertible Note Financing To Fund Crucitas Development
Wednesday August 27, 1:02 pm ET

Trading Symbol: TSX-V: IG

CALGARY, Aug. 27 /CNW/ - Infinito Gold Ltd. (the "Company") announces that it has agreed to complete a non-brokered private placement of an aggregate of CDN$18 million principal amount of convertible notes (the "Notes") with Exploram Enterprises Ltd. ("Exploram") and Auro Investments Ltd. ("Auro"). The Notes mature five years after their date of issue, bear interest at 11% per year, payable monthly, and are convertible at any time up to maturity into common shares of the Company at $0.635 per share, being a 15% premium to the volume weighted average trading price of the shares of the Company for the previous 10 trading days. The Company has the right to prepay the Notes, in whole or in part, at any time after 30 months after their date of issue, subject to the holders' rights to convert before prepayment. The Notes will include negative covenants, positive covenants and conversion right adjustment provisions that are typical for transactions of this nature. The Notes also contain events of default typical to transactions of this nature, including a breach of the terms of the Notes, cross-defaults with other indebtedness, bankruptcy, insolvency or receivership proceedings, a change of control of the Company, a change of business of the Company's Costa Rican subsidiary and relating to securing a standard regulatory approval within a certain time frame. A cash structuring fee of 3% of the aggregate principal amount of the Notes will be paid by the Company to Exploram and Auro, proportionate to their respective subscriptions. The Company has also agreed to secure the Notes by a fixed and floating charge over all of the assets of the Company, if requested over the term of the Notes by Exploram or Auro construction of the Company's Crucitas mine in Costa Rica as well as for general corporate purposes.

Exploram is the controlling shareholder of the Company and is acquiring CDN$12,500,000 principal amount of Notes and Auro is a company associated with Steven Dean, the Chairman of the Company, and is acquiring CDN$5,500,000 principal amount of Notes; therefore, the transaction is a related party transaction for the purposes of TSX Venture Exchange Policy 5.9. A special committee of independent directors of the Company was struck to consider and negotiate the terms of the transaction.

The issue and sale of the Notes is subject to acceptance of the TSX Venture Exchange.

http://biz.yahoo.com/cnw/080827/infi...