Integra arranges US$20 million loan, closes offering

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Integra Resources Corp. [ITR-TSXV.ITR, IRRZF-OTCQB] said Beedie Investments Ltd. has agreed to provide Integra with a loan of up to US$20 million that will be used to fund exploration and development at the company’s DeLamar Gold and Silver project in southwestern Idaho.

The company said it plans to advance the project towards the filing of a plan of operations and complete 15,000 metres of shallow oxide definition drilling, aimed at resource expansion for the proposed heap leach operation.

The loan will be funded by way of an initial advance of US$10 million on the closing date and the remaining US$10 million will be available for subsequent advances in minimum tranches of US$2.5 million over the term of the loan facility.

The loan facility carries an interest rate of 8.75% on advanced funds, and 2.0% on standby funds available, with the principal repayment due 36 months after the closing date, with the potential for a 12-month extension at Integra’s election, subject to conditions.

In addition, the loan includes a commitment fee of 1.5% on the total amount.

Details of the credit agreement were released after the close of trading on August 4, 2022, when Integra shares closed unchanged at 85 cents. The shares are currently trading in a 52-week range of $3.86 and 82 cents.

In the August 4, 2022 press release, Integra said it had closed a previously announced overnight marketed public offering that raised US$11 million from the sale of 16.7 million common shares, including 1.5 million issued in connection with an over-allotment option granted to the underwriters at 66 cents per share.

Prior to entering into the credit agreement, Beedie held 3.04 million Integra shares, and could see its interest rise to almost  29% (29.2 million shares) if the total amount advanced under the terms of the loan is converted into Integra shares.

Under the credit agreement, Beedie may elect to convert the principal amount of the initial advance into common shares of Integra at a conversion price of $1.22 per share. Subject to the approval of the TSX Venture Exchange, the principal amount of any subsequent advance will be convertible at a conversion price equal to the higher of:

The market price of the common shares, less the maximum permitted discount under the rules and policies of the applicable stock exchange on which the shares trade.

A 20% premium above the 30-day volume weighted average price of the common shares, in each case measured on the close of trading on the trading day immediately prior to the announcement of the funding date of the subsequent advance.

Integra acquired the DeLamar Gold and Silver Project from Kinross Gold Corp. [K-TSX,NYSE]  in September, 2017 for $7.5 million in cash and issued a number of shares equal to 9.9% of Integra’s outstanding equity.

The project includes the historic Kinross DeLamar Mine that closed in 1998 due to low precious metal prices. DeLamar produced 1.6 million ounces of gold and 100 million ounces of silver.


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