Loyalist Exploration Limited (CSE:PNGC) announced the termination of its non-brokered private placement and the closing of a shares for debt transaction, marking a significant step in its efforts to fund the ongoing preliminary economic assessment (PEA) at its Tully gold project in Timmins, Ontario. The company raised $1,000,000 through the first and final tranche of the offering, which was originally announced on August 10, 2026, and closed on August 31, 2026. No further tranches will be completed.
The shares for debt transaction settled $113,285 of outstanding indebtedness through the issuance of 2,832,125 common shares at $0.04 per share. Notably, $45,000 of that debt was owed to Errol Farr, President and CEO, and Leonard Mackenzie, Vice President of Exploration, both related parties. The company relied on exemptions from formal valuation and minority approval requirements under MI 61-101, as the fair market value of the transaction did not exceed 25% of the company’s market capitalization.
Proceeds from the offering will be used to complete NI 43-101 technical reports, including a resource estimate and PEA on the Tully project, as well as for permitting work, property payments, and general working capital. The debt settlement reduces the company’s liabilities, strengthening its balance sheet as it advances Tully toward production.
Errol Farr commented, “We are grateful for the support of our subscribers, which has enabled us to achieve our objective of funding the ongoing Tully PEA. With this capital in place, we continue to execute on our strategy of becoming the next gold producer in the Timmins camp by systematically advancing Tully toward a fully funded and permitted mining operation.”
The company also paid finder’s fees of $37,200 in cash to Haywood Securities Inc. and issued 930,000 broker warrants exercisable at $0.075 until August 31, 2028. All securities issued are subject to a four-month-and-one-day hold period.
This news matters because it secures necessary funding for the Tully PEA, a critical milestone in demonstrating the project’s economic viability. The debt settlement improves the company’s financial position by converting liabilities into equity, aligning creditor interests with shareholders. As a result, Loyalist is better positioned to advance Tully toward production and capitalize on the prolific Timmins Gold Camp.
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