Loyalist Exploration Limited (CSE:PNGC) announced the termination of its previously announced non-brokered private placement and the closing of a shares for debt transaction, according to a company statement. The offering, originally announced on August 10, 2026, was terminated with no further tranches to be completed. The first tranche, which closed on August 31, 2026, consisted of 25,000,000 common shares at $0.04 per share for gross proceeds of $1,000,000. This first tranche represents the final closing of the offering.
In addition, the company closed a shares for debt transaction, settling an aggregate of $113,285.00 of outstanding indebtedness through the issuance of 2,832,125 common shares at a price of $0.04 per common share. All securities issued in connection with the shares for debt transaction are subject to a hold period expiring four months and one day after the date of issuance. The transaction included the settlement of $45,000 of indebtedness owing to Errol Farr, President, CEO and a director, and to Leonard Mackenzie, Vice President of Exploration, through the issuance of 1,125,000 common shares. Both are considered related parties under Multilateral Instrument 61-101, making the shares for debt transaction a related party transaction. The company relied on exemptions from formal valuation and minority approval requirements, as the fair market value does not exceed 25% of the company's market capitalization.
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 proceeds from the first tranche will be used to complete ongoing NI 43-101 technical reports, including a resource estimate and preliminary economic assessment on the Tully project, as well as ongoing production permitting work, property payments, and general working capital. In connection with the first tranche, the company paid finder's fees of $37,200 in cash to Haywood Securities Inc. and issued 930,000 non-transferable broker warrants, each exercisable at $0.075 per common share until August 31, 2028.
This news matters because it provides Loyalist with the necessary capital to advance its flagship Tully Gold Project in Timmins, Ontario, a prolific mining camp. The completion of the financing and debt settlement strengthens the company's balance sheet and allows it to focus on key technical studies and permitting. The termination of the offering suggests that the company has secured sufficient funds for its immediate objectives, reducing the need for further dilution. For investors, this signals progress toward becoming a gold producer, which could enhance shareholder value. The involvement of related parties in the debt settlement aligns management's interests with those of shareholders. The original release can be viewed on www.newmediawire.com.
