Troilus Gold Corp. Secures $35 Million Loan Facility
Troilus Gold Corp. (TSX: TLG; OTCQX: CHXMF; FSE: CM5R) has successfully finalized a loan agreement, securing a principal amount of up to US$35 million, approximately CDN$49 million, to bolster its development efforts. This financial support is aimed at facilitating a variety of pre-development activities, including securing necessary permits and preparing for early work on the Troilus Project.
Strengthening Development Initiatives
The loan is designed to be non-dilutive, thereby allowing Troilus to maintain its financial integrity while supporting essential activities that precede larger project financing. Justin Reid, the CEO of Troilus, emphasized the significance of this agreement, noting that it adds to the company's existing strong balance sheet and the expected inflow from over $16 million in in-the-money warrants. He described the loan as a strategic step towards advancing their initiatives aggressively, completing permit processes, and achieving full project financing.
Details of the Loan Structure
This one-year loan will be disbursed in tranches to meet Troilus's working capital needs. The initial tranche of US$15 million has already been provided upon the execution of the loan agreement. The remaining US$20 million will become available after 90 days, contingent on Troilus meeting specific conditions outlined in the agreement.
Financial Terms and Incentives
The loan accrues interest at a monthly rate of 1.0% on the outstanding balance, including principal and any accrued interest. Moreover, it is secured by a negative pledge on the company’s assets along with personal property. Troilus has the option to prepay the loan without incurring penalties, which adds further flexibility to their financial strategy. There is also potential for an extension of the loan maturity for an additional six months, subject to fulfillment of specific criteria.
Equity Incentives to Lenders
As part of the financing agreement, the lender, Auramet International, Inc., received 5 million warrants, each allowing the purchase of one share of Troilus at an exercise price of $0.60, reflecting a premium over market value. An additional set of 5 million warrants will be granted upon the second tranche’s disbursement. This arrangement aligns the interests of the lender with those of Troilus and signifies the lender's confidence in the future of the project.
Auramet’s Role as Financial Partner
Auramet is recognized as one of the leading physical precious metals merchants, boasting annual revenues exceeding US$25 billion. Established in 2004, Auramet brings a depth of expertise to its role as the senior advisor for Troilus's project financing initiatives. The collaboration aims to leverage Auramet’s extensive industry knowledge to optimize financial strategies for the Troilus Project.
About Troilus Gold Corp.
Troilus Gold Corp. is a Canadian development-stage mining entity focusing on the advancement of the Troilus Mine. Located in a premier mining region of Quebec, the company holds a significant land position within the Frôtet-Evans Greenstone Belt, encompassing 435 km². A recently completed Feasibility Study highlights the potential for a large-scale operation capable of producing 50,000 tons per day over a 22-year mine life, positioning Troilus as a key player in the North American mining sector.
Contact Information
For inquiries:
Caroline Arsenault
VP Corporate Communications
+1 (647) 276-0050
info@troilusgold.com
Frequently Asked Questions
What is the purpose of the $35 million loan secured by Troilus?
The loan will support Troilus's pre-development activities, including permitting and early works towards full project financing.
Who is the lender for this loan?
Auramet International, Inc. is the lender providing the loan to Troilus Gold Corp.
What are the financial terms of the loan?
The loan has a term of one year with a monthly interest rate of 1.0% on the outstanding balance.
What incentives does the lender receive?
The lender has been granted 10 million warrants overall, allowing them to purchase shares of Troilus at a price above market value, which aligns their interests with the company's success.
Where is Troilus Gold Corp. focused on mining activities?
The company is focused on the Troilus Mine located in Quebec, Canada, holding a significant land position in a notable mining region.
