Los Andes Copper Ltd. (TSXV: LA) (“Los Andes”, or the “Company”) is pleased to announce that it has entered into a subscription agreement with Resource Capital Fund VI L.P. (“RCF VI”) pursuant to which RCF VI has agreed to purchase 26,800,000 units of the Company (the “Units”) at a price of $0.33 per Unit (the “Private Placement”). Each Unit will consist of one common share of the Company (a “Unit Share”) and one-half of one transferable common share purchase warrant (each whole common share purchase warrant, a “Warrant”), with each Warrant entitling RCF VI to purchase one additional common share of the Company (a “Warrant Share”) at a price of $0.50 per Warrant Share for a period of 5 years from the date of the closing of the First Tranche or Second Tranche (as such terms are defined below), as applicable. As additional consideration to the Company for the Private Placement, RCF VI will also be delivering to the Company for cancellation 26,800,000 common share purchase warrants (issued pursuant to a private placement completed on December 8, 2016) that are currently held by RCF VI (the “2016 Warrants”).
The proceeds of the Private Placement will be used by the Company to complete its technical work on the Company’s Vizcachitas project, with a view to completing an updated resource estimate and an updated preliminary economic assessment in the coming months, as well as for general working capital purposes.
The Private Placement is subject to acceptance by the TSX Venture Exchange (“TSXV”). The Company intends to close a first tranche of the Private Placement consisting of 7,870,000 Units for gross proceeds of $2,597,100 upon receipt of TSXV approval for the Private Placement (the “First Tranche”). The remaining balance of 18,930,000 Units is expected to close within 45 days for gross proceeds of $6,246,900 (the “Second Tranche”). In the event that the Company is unable to close the Second Tranche, RCF VI shall retain 18,930,000 2016 Warrants.
The Unit Shares and Warrant Shares will be subject to a hold period of four months from the date of issuance of the Units, in accordance with applicable Canadian securities laws.