East Africa Metals and Luck Sky Resources Investment (LS), an affiliate of Luck Winner Investment, have entered into a binding subscription agreement for the purchase of 52100 000 units at a price of $0.26 per unit for aggregate gross proceeds of approximately C$13 550 000.
Each unit will consist of one common share and one-half of one share purchase warrant, with each whole warrant exercisable for $0.45 and expiring 24 months from closing.
The securities issued under the private placement will be subject to a hold period of four months.
The proceeds will be used to continue exploration programs on the company’s projects in Ethiopia and general working capital.
East Africa Metals plans to close on 7 700 000 units for gross proceeds of C$2 002 000 from LS around 27 December, 2017.
Closing of the remaining 44 400 000 units for gross proceeds of C$11 544 000 are subject to certain conditions, including but not limited to, disinterested shareholder approval of the creation of a new control person and approval of the TSX Venture Exchange.
Upon completion of the private placement for 52 100 000 units, LS will own approximately 26% of East Africa Metals’ outstanding shares (34.5% on a diluted basis).
East Africa Metals will no longer be seeking a US$2 000 000 loan from LS.
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