Aton Resources (TSX-V:AAN) has secured access to a US$30 million ($42 million) credit facility from its majority shareholder to advance the Hamama Project in Egypt.
According to the agreement, the unsecured facility from OU Moonrider may be drawn in one or more advances and matures on 1 September 2028.
Amounts drawn will accrue interest at 12% per annum. Any principal or accrued interest left unpaid after maturity will attract interest at 20% per annum until repaid.
The debt cannot be converted into Aton shares, while neither principal nor interest may be paid in company securities. No bonus shares or warrants will be issued in connection with the facility.
Moonrider owns approximately 66.4% of Aton through its holding of 89.7 million shares, making the agreement a related-party transaction under Canadian securities rules.
The facility is exempt from formal valuation and minority shareholder approval requirements under Canada’s Multilateral Instrument 61-101 because Aton is not listed on specified markets and the loan has no equity or voting component.
Aton says its board determined that the facility was offered on reasonable commercial terms that were no less advantageous than those potentially available from an arm’s-length lender.
Moonrider nominee Tonno Vahk, who is also Aton’s CEO, abstained from voting on the agreement.
Any amounts drawn will fund further exploration and development at Hamama, along with general and administrative expenses.
Hamama forms part of Aton’s wholly owned Abu Marawat Concession in Egypt’s Arabian-Nubian Shield, about 200km north of AngloGold Ashanti’s (NYSE:AU) Sukari gold mine.
The concession also contains the Abu Marawat and Rodruin deposits and the historic Semna and Sir Bakis gold mines. Its 57.66km² exploitation lease was established in January 2024 for an initial 20-year term, while a further 255km² of exploration tenure was retained for four years from January 2024.
Write to France Pinzon at Mining.com.au
Images: Aton Resources
