Heavy Minerals (ASX:HVY) has completed the first tranche of the prepaid royalty funding, raising $2.1 million, after executing an agreement with Campbell Transport.
The agreement with Campbell Transport resulted in raising $1.25 million, adding to the previously raised $850,000 from professional and sophisticated investors.
Heavy Minerals is also awaiting funds from an additional $170,000 of pending subscriptions.
Under the first tranche, 770,000 options are unlisted and are exercisable into shares at $0.25 per option. All options, which will be issued on or about 16 August 2024, have a 24 month expiry date.
The funds raised will be used towards completing the Port Gregory Prefeasibility Study (PFS) and general working capital.
Heavy Minerals will look to secure the second tranche of the royalty funding early next year for the purpose to complete a Bankable Feasibility Study at Port Gregory.
The funds committed by Campbell Transport will be received in three unconditional installments that align with the requirements of the PFS. The first installment of $500,000 will be received within seven days and the raminins two equal installments will be received before the end of February next year.
Chairman Adam Schofield says the participation of Campbell Transport and other subscribers in this funding is a testament to the “highly rewarding” nature of royalties and the potential of Port Gregory.
“The company will look to sign a memorandum of understanding with Campbell Transport in the near term with a view to their provision of logistics support for the Port Gregory operations from mine gate to ship loading at the Port of Geraldton,” Schofield says.
“We look forward to developing a close working relationship with Campbell Transport and we greatly appreciate their support and belief in the company, the board and our flagship Port Gregory Project.
“This royalty funding clears the path for the company to complete the Port Gregory Project PFS and positions the company for the commencement of the BFS.”
Further, Heavy Minerals has also entered into an at-the-market subscription agreement with Acuity Capital. The ATM provides the company with up to $2 million of standby equity capital over the coming five years to 31 July 2029.
Heavy Minerals is an Australian industrial minerals explorer focused on its project considered prospective for garnet, zircon, rutile, and ilmenite.
Write to Aaliyah Rogan at Mining.com.au
Images: Heavy Minerals
