Red Rock Resources (LON:RRR) has boosted its financial position, having entered into a US$9 million loan agreement with YA Global Master SPV Limited.
Red Rock can borrow the money in three tranches of up to US$3 million each with the first tranche set to be advanced as soon as possible and the second and third tranches are expected to be advanced on 15 August 2011 and 15 December 2011.
Investors welcomed the news as shares in Red Rock climbed 5 percent in early deals.
The loan carries interest at 12 percent per annum and each tranche is to be repaid in scheduled instalments within 13 months of drawdown.
The loan is secured under a Standby Equity Distribution Agreement between Red Rock and YA Global entered into on 19 November 2009 and by security over certain liquid assets of Red Rock.
The company said that the facility should strengthen its financial position and capacity to advance its current strategies in gold and in steel feed materials.
Red Rock simultaneously announced that it has sold 4.5 million shares of Jupiter Mines (ASX:JMS) for A$2.76 million, retaining a 4.52 percent stake.