Auryn Resources Inc (TSE:AUG) (NYSEAMERICAN:AUG), the Canada and Peru-focused exploration group, said it had closed its previously announced bridge loan for up to C$6 million to be used for working capital, and has received the first tranche of C$3 million.
As reported earlier this month, the facility, consists of two tranches of C$3 million each, with the second tranche conditional upon both parties agreeing.
The group's flagship assets are the Committee Bay high-grade gold project in Nunavut, Canada and the Sombrero copper-gold project in southern Peru.
Last week, Auryn's chairman Ivan Bebek told investors the company had opted for a bridge loan rather than a capital raise that would dilute its stock in order to “maintain current operations while we execute on various catalysts across our portfolio of seven gold and copper projects.
“The company is currently awaiting drill results from its Committee Bay project, exploration results from its Homestake Ridge project and importantly, in-process drill permits for its Sombrero project in Southern Peru, which are progressing on schedule,” he added.
High degree of optionality
“Our portfolio of projects represents a high degree of optionality and the current increase in precious metal prices certainly improves all monetization and value-add options we may consider with our projects.”
The loan is expected to supply the company with enough working capital to last about a year and bears interest at 10% a year. It is repayable no later than one year after the date of advancement
In connection with the loan, 500,000 bonus warrants were issued when the first tranche closed. Each warrant is exercisable into one company share for C$2 each.
Shares nudged up 1.23% in Toronto to stand at C$1.64 each.
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