Surefire Resources NL (ASX:SRN) has entered into an agreement for a loan drawdown facility of up to $500,000 with Vargas Holdings Pty Ltd, a company associated with the company’s executive chair Vladimir Nikolaenko.
The proceeds of the facility will be used for general working capital purposes.
While the entry into this facility agreement provides the company with additional funding, Surefire says that it continues to consider further and alternative funding options for its operations moving forward.
The announcement follows news less than two weeks ago that Surefire has defined nine new priority drill targets at its 100%-owned Yidby Gold Project in Western Australia.
These targets have been delineated from IP and structural reinterpretations, and present potential for depth extensions of current mineralised intercepts into a deeper porphyry system.
A drill program for all nine recommended high-priority targets will be planned and a program of works (PoW) submitted to the West Australian Department of Energy Mines Industry Regulation and Safety (DEMIRS) for this work.
Surefire intends to combine this program with the drilling of the copper anomalies at the Phat Boy prospect.
Details of the loan facility
- An initial tranche of up to $500,000 will be made available pursuant to one or more drawdown notices;
- An option for Surefire to increase the facility by up to an additional $250,000 subject to certain conditions;
- An interest rate of 14% per annum to accrue on advances made under the facility; and
- All advances, together with all outstanding monies, to be fully repaid six months from the date the first advance is made.
ATM extension and collateral share increase
The company has also agreed with Acuity Capital to extend the expiry date of its at-the-market (ATM) subscription agreement.
The ATM was initially established with an expiry date of December 31, 2020, and provided Surefire with up to $2 million of standby equity capital. It was subsequently extended to January 31, 2023, then further extended to January 31, 2026, and is now being extended to January 31, 2029.
Surefire has to date not utilised the ATM to raise capital.
The company has also agreed, subject to shareholder approval, to increase the number of shares held as security by Acuity Capital under the ATM.
If approved by shareholders, the company will issue a further 80 million shares to Acuity Capital, taking the number of shares held as security against the ATM to 100 million.
Surefire can cancel the ATM at any time, including buying back and cancelling the collateral shares for nil cash consideration.