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Heliostar Announces Letter of Intent for a US$20M Gold Linked Debt Facility to Advance Ana Paula Deposit
HIGHLIGHTS : Debt Facility to fund completion of the Decline, Test Mining and processing of...
About this update from Heliostar Metals Ltd
[{"type":"text","content":"Heliostar Announces Letter of Intent for a US$20M Gold Linked Debt Facility to Advance Ana Paula DepositHIGHLIGHTS:Debt Facility to fund completion of the Decline, Test Mining and processing of a Bulk SampleThis self-funding path is an innovative means of funding the advancement of the Ana Paula Project and minimize equity dilutionFunding expected to be repaid within 30 months from drawdown through sale of gold from the bulk sampleCompletion of the decline reduces future capital expenditure and future drilling costsA component of the debt funding and additional cash flows generated from the Test Mining to be used for additional drilling to grow the Ana Paula resource Vancouver, British Columbia--(Newsfile Corp. - May 7, 2024) - Heliostar Metals Ltd. (TSXV: HSTR) (OTCQX: HSTXF) (FSE: RGG1) (\"Heliostar\" or the \"Company\") is pleased to report it has entered into a non-binding letter of intent in respect of a senior secured debt facility (the \"Facility\") for the aggregate principal amount of US$20 million (the \"Loan Amount\") with an expected fixed 10% rate of interest with a syndicate of lenders led by a New York based Financial Institution (together, the \"Lenders\").The net proceeds of the Facility will be used to advance the underground decline and complete test mining to process a bulk sample from the Ana Paula deposit in Guerrero, Mexico (\"Test Mining\"). The Facility is expected to have a 30-month term and is subject to an annual interest rate of 10%, payable semi-annually. The Facility is expected to be assured by customary security commitments, including over the Ana Paula Project. The facility allows for the early repayment of the Facility at any time, and upon the sale of gold ounces. The facility calls for Heliostar to make repayments equal to the number of ounces of gold sold multiplied by US$1,850 per ounce (the \"Reference Price\") after deducting operating expenses.Heliostar CEO, Charles Funk, commented, \"Finding a self-funded solution that diminishes the amount of equity dilution to advance the development of the Ana Paula Project and undertake a Test Mining program has been the Company's focus in 2024. Today's announcement puts Heliostar on the front foot to continue to de-risk the Ana Paula project and accelerate its path to commercial production. Funding from the financing will be used to complete the de...