LAVAL, QUEBEC -- (Marketwired) -- 06/18/13 -- TYPHOON EXPLORATION INC. ("Typhoon") (TSX VENTURE: TYP) is pleased to announce that is has issued 5,555,556 Class "A" shares (the "Common Shares") at a price of $0.09 per Common Share to Aurizon Mines Ltd. ("Aurizon") for gross proceeds of $500,000 by way of a private placement made under applicable prospectus exemptions (the "Private Placement"). The issue price per Common Share was based on the volume-weighted average trading price on the TSX Venture Exchange for the 15-day period ending on June 13, 2013. The Common Shares are subject to a statutory four (4) month and one (1) day hold period ending on October 19, 2013.
Pursuant to an option agreement between Typhoon and Aurizon dated May 17, 2010, as amended (the "Option Agreement"), Aurizon has a first option to earn a 50% interest (the "First Option") in (a) the Fayolle Property (39 mining claims 100%-owned by Typhoon, covering 1373 hectares) and (b) the interests of Typhoon in the Aiguebelle-Goldfields Property (6 mining claims 51%-owned by Typhoon and 49%-owned by Agnico-Eagle Mines Limited, covering 254 hectares) (collectively, the "Properties").
The Fayolle Property straddles about 15 km of the Porcupine-Destor Fault (80 million ounces of gold produced). This major east-west oriented structure generated several mineral deposits in Quebec as well as in Ontario. The Fayolle Deposit (known to date) covers about 1% of the total surface area of the Fayolle Property (23.23 km2). The Fayolle Project is located in the heart of Abitibi's developing mining projects, such as Iamgold's Westwood, Aurizon's Joanna and Osisko's Canadian Malartic projects.
The Option Agreement provides that to earn such a 50% interest, Aurizon must incur over a 4-year period an aggregate amount of $10,000,000 in exploration work on the Properties and subscribe for $2,000,000 of Common Shares of Typhoon in 4 tranches of $500,000 each on closing of the Option Agreement and on each of the first three anniversary dates of the Option Agreement.
Following the exercise of the First Option, Aurizon may acquire an additional 15% interest in the Properties, for a total of 65%, by either completing a bankable feasibility study or by spending a further amount of $15,000,000 in exploration work on the Properties by June 2016.
Immediately prior to the Private Placement, Aurizon had incurred a total of $9,168,327 in exploration work on the Fayolle Property and has also completed subscriptions for $1,500,000 in Typhoon.
The Private Placement thus constitutes the fourth (4th) and last subscription by Aurizon that was contemplated by the Option Agreement.
David Mc Donald, President and CEO of Typhoon, commented on the transaction: "We are most optimistic about the future of the Fayolle Project with this last private placement of $500,000, completing the funding commitment of $2,000,000, agreed upon in May 2010 between the two companies. On my own behalf and on behalf of the directors and employees of Typhoon, I would like to thank the management and all the staff at Aurizon for their support and advice throughout the years. In addition, I wish to welcome the management and staff of Hecla Mining Company, which now owns Aurizon, and thank them for this opportunity to continue to develop the Fayolle Project together."
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