Avarone closes $140,000 first tranche of placement

Jul 8, 2016

Avarone Metals Inc. has closed the initial tranche of a non-brokered private placement, issuing a total of 1.75 million units for gross proceeds of $140,000. Each unit consisted of one common share and one-half common share purchase warrant, whereby each full warrant entitles the holder to purchase one additional common share of the company for a period of 24 months from closing at an exercise price of 12 cents per share.

The proceeds from the first tranche will be used to conduct further exploration at the company’s Moab lithium project in the South Big Smoky Valley, Nevada, and for general working capital purposes.

The securities distributed under the first tranche are subject to a statutory hold period of four months plus one day from the date of issuance.

A director and officer of the company participated in the first tranche by purchasing an aggregate of 250,000 units. Accordingly, the first tranche constituted to that extent a related-party transaction as defined under Multilateral Instrument 61-101 (protection of minority securityholders in special transactions). The transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101, as neither the fair market value of any shares issued to, nor the consideration paid by such persons, exceeded 25 per cent of the company’s market capitalization. Further, neither the company nor the related party has knowledge of any material information concerning the company or its securities that has not been generally disclosed.

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