Argentina Lithium closes private placement
2022-08-25 17:43 ET – News Release
Mr. Nikolaos Cacos reports
ARGENTINA LITHIUM CLOSES NON-BROKERED PRIVATE PLACEMENT AND ACQUISITION OF RINCONCITA II AT SALAR DE RINCON
Argentina Lithium & Energy Corp. has closed the private placement announced on July 21, 2022, and increased on Aug. 9, 2022, and Aug. 11, 2022, through the issuance of 10,415,000 units in this second and final tranche, for aggregate gross proceeds to the company of $2,083,000. In total, the company has closed on 16.63 million units for aggregate gross proceeds of $3,326,000. The company has also closed the acquisition of the Rinconcita II mining concession area, located on the Salar de Rincon in Salta province, Argentina, from provincially owned company Recursos Energeticos y Mineros Salta S.A. (REMSA), as previously announced by the company on July 21, 2022.
Each unit consists of one common share and one transferable common share purchase warrant. Each warrant will entitle the holder thereof to purchase one additional common share in the capital of the company at 38 cents per share for two years from the date of issue, expiring on Aug. 25, 2024, for this final tranche.
No finders’ fees were paid in the final tranche. In total, $36,260 were paid in cash on a portion of the private placement to parties at arm’s length to the company. In addition, 181,300 non-transferable finders’ warrants were issued. Each finder’s warrant entitles a finder to purchase one common share at a price of 38 cents per share for two years from the date of issue, expiring on Aug. 25, 2024.
There were no insiders who participated in the final tranche, however, certain insiders of the company participated in the private placement for $20,000 in units. Such participation represents a related party transaction under Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions, but the transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of the subject matter of the transaction, nor the consideration paid, exceeds 25 per cent of the company’s market capitalization.
A new control person on a diluted basis was created in this tranche. This individual has agreed that he will not exercise any of the warrants if such exercise will result in his beneficially owning or having control or direction over that number of voting securities of the company that is 20 per cent or greater of the total issued and outstanding voting securities of the company, immediately after giving effect to such exercise, or result in the undersigned becoming a control person as defined in the policies of the TSX Venture Exchange.
This financing is subject to regulatory approval and all securities to be issued pursuant to this final tranche of the financing are subject to a four-month hold period expiring on Dec. 27, 2022.
The proceeds of the financing were used, in part, to complete the acquisition of Rinconcita II from REMSA. The balance of the proceeds will be used for general working capital and exploration on the company’s properties in Argentina. In consideration for the acquisition of Rinconcita II, the company made a payment to REMSA of $2.5-million (U.S.) and granted REMSA a 3-per-cent net smelter return (NSR) royalty on mineral and refined products sourced from Rinconcita II over its production life, if the property advances to the production stage. The company’s acquisition of Rinconcita II is subject to the final acceptance of the exchange, which should be available upon filing of a signed copy of the agreement with the exchange.
About Argentina Lithium & Energy Corp.
Argentina Lithium is focused on acquiring high-quality lithium projects in Argentina and advancing them toward production in order to meet the growing global demand from the battery sector. The management group has a long history of success in the resource sector of Argentina and has assembled a first rate team of experts to acquire and advance the best lithium properties in the world-renowned Lithium Triangle. The company is a member of the Grosso Group, a resource management group that has pioneered exploration in Argentina since 1993.
We seek Safe Harbor.
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