ASM: TSX/NYSE American
VANCOUVER, BC, Aug. 13, 2020 /PRNewswire/ - Avino Silver & Gold Mines Ltd. (ASM:
TSX) (ASM: NYSE American) (FSE: GV6) ("Avino" or "the
Company") announced today that its board of
directors has determined to proceed with an option agreement dated
August 12, 2020 (the "Option
Agreement") with Gray Rock Resources Ltd. ("Gray Rock"), as optionee. Pursuant to
the terms of the Option Agreement, Gray
Rock was granted the exclusive right to acquire an 100%
interest in the Ana Maria and El Laberinto properties in
Mexico (the "Option"), in
consideration of the issuance to Avino of share purchase warrants
to acquire 300,000 common shares of Gray
Rock at an exercise price of $0.20 per share for a period of 36 months from
the date of the TSX Venture Exchange's final acceptance of the
Option Agreement (the "Approval Date"). In order
to exercise the Option, Gray Rock
will:
1. Issue to Avino a total of $600,000 in cash or common shares of Gray Rock as follows:
a.
|
$50,000 in common
shares of Gray Rock within 30 days of the Approval Date;
|
b.
|
A further $50,000 in
cash or shares of Gray Rock at Avino's discretion on or before the
first anniversary of the Approval Date;
|
c.
|
A further $100,000 in
cash or shares of Gray Rock at Avino's discretion on or before the
second anniversary of the Approval Date;
|
d.
|
A further $200,000 in
cash or shares of Gray Rock at Avino's discretion on or before the
third anniversary of the Approval Date; and
|
e.
|
A further $200,000 in
cash or shares of Gray Rock at Avino's discretion on or before the
fourth anniversary of the Approval Date; and
|
2. Incur a total of $750,000
in exploration expenditures on the properties, as follows:
a.
|
$50,000 on or before
the first anniversary of the Approval Date;
|
b.
|
A further $100,000 on
or before the second anniversary of the Approval Date;
and
|
c.
|
A further $600,000 on
or before the fourth anniversary of the Approval Date.
|
Under the Option Agreement, the parties intend that the first
two year's payments ($200,000 in cash
or shares), and first $150,000 in
exploration work will be firm commitments by Gray Rock. All share issuances will be based on
the average volume weighted trading price of Gray Rock's shares on the TSX Venture Exchange
for the ten (10) trading days immediately preceding the date of
issuance of the shares, and the shares will be subject to resale
restrictions under applicable securities legislation for 4 months
and a day from their date of issue.
Any exploration expenditures in excess of any period stated
above will be applied towards the next succeeding period's minimum
requirements. During the option period, Gray Rock will also assume liability and be
responsible for all required semi-annual property payments required
to maintain the properties in good standing.
Gray Rock also granted to Avino a
right of first refusal to purchase and process any ore or
concentrate extracted from the properties for processing under
identical terms as the third party offer at Avino's mine
facilities.
The Ana Maria property consists of nine mining concessions
located 21 km northwest of the City of Gómez Palacio and the
adjacent City of Torreón, and 1 km north of the town of
Dinamita, in the municipality of
Gómez Palacio, Durango, México. The Ana Maria property comprises a
total area of 2,549 hectares, more or less. The El Laberinto
property consists of one (1) mining concession located in the
"Sierra de la Silla" northwest of the town of Francisco I. Madero, in the municipality of
Panuco de Coronado. It is
approximately 60 kilometers northeast of the city of Durango City,
México, and comprises a total area of 91.7 hectares, more or
less.
The terms of the Option Agreement were recommended to the board
of directors by an independent special committee of the Board due
to the fact that Gray Rock and Avino
have a director in common, namely David
Wolfin, who also holds indirectly a control position in
Gray Rock. Mr. Wolfin was not
involved in the negotiations of the Option Agreement, and has
abstained from voting thereon as a director of Gray Rock and Avino. The independent
special committee of the Company considered all material facts
currently known concerning the properties, which were relevant to
its recommendation to the board.
As a "related party transaction" within the meaning of
Multilateral Instrument 61-101, Avino will rely upon the exemptions
from the requirements of a formal valuation and majority of the
minority approval afforded by sections 5.5(a) and 5.7(a)
respectively of Multilateral Instrument 61-101.
The Option Agreement is subject to the acceptance for filing on
behalf of Gray Rock by the TSX
Venture Exchange.
On Behalf of the Board
"David Wolfin"
________________________________
David Wolfin
President & CEO
Avino Silver & Gold Mines
Ltd.
Safe Harbor Statement - This news release contains
"forward-looking information" and "forward-looking statements"
(together, the "forward looking statements") within the meaning of
applicable Canadian securities laws and the United States Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are made as of the date of this news release. Readers
are cautioned not to place undue reliance on forward-looking
statements, as there can be no assurance that the future
circumstances, outcomes or results anticipated in or implied by
such forward-looking statements will occur or that plans,
intentions or expectations upon which the forward-looking
statements are based will occur. While we have based these
forward-looking statements on our expectations about future events
as at the date that such statements were prepared, the statements
are not a guarantee that such future events will occur and are
subject to risks, uncertainties, assumptions and other factors
which could cause events or outcomes to differ materially from
those expressed or implied by such forward-looking
statements.
Such factors and assumptions include, among others, the
effects of general economic conditions, the price of gold, silver
and copper, changing foreign exchange rates and actions by
government authorities, uncertainties associated with legal
proceedings and negotiations and misjudgments in the course of
preparing forward-looking information. In addition, there are known
and unknown risk factors which could cause our actual results,
performance or achievements to differ materially from any future
results, performance or achievements expressed or implied by the
forward-looking statements. Known risk factors include risks
associated with project development; the need for additional
financing; operational risks associated with mining and mineral
processing; fluctuations in metal prices; title matters;
uncertainties and risks related to carrying on business in foreign
countries; environmental liability claims and insurance; reliance
on key personnel; the potential for conflicts of interest among
certain of our officers, directors or promoters with certain other
projects; the absence of dividends; currency fluctuations;
competition; dilution; the volatility of the our common share price
and volume; tax consequences to U.S. investors; and other risks and
uncertainties. Although we have attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events
or results not to be as anticipated, estimated or intended. There
can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. We are under no obligation to update or alter any
forward-looking statements except as required under applicable
securities laws.
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SOURCE Avino Silver & Gold
Mines Ltd.