LithiumBank Secures $8 Million Deposit Under New Option Arrangement For Sask Lithium Properties
LithiumBank Resources (TSXV: LBNK) this morning has terminated a deal to sell its assets in Saskatchewan to Pristine Lithium Corp which was entered into in July, in favor of an option agreement that has placed immediate funds into the company’s bank account.
Under the terms of the new option arrangement, which was with an undisclosed party, LithiumBank has granted the right for the optionee to acquire one or more of the lithium brine projects that the company holds in Saskatchewan. As part of the transaction, the optionee has paid a non-refundable $8 million deposit to LithiumBank.
One or more of the options can be exercised by paying the related undisclosed purchase price for the properties, less the deposit. The option agreement is set to terminate March 31, 2024.
The transaction compares to the arrangement entered into with Pristine Lithium in July, which would have seen LithiumBank receive $2.0 million in cash for the Estevan, Kindersley, and South projects, as well as 40.0 million common shares and 20.0 million warrants in Pristine, representing a 47% stake in the explorer.
The three projects, which are focused on lithium brine, have lithium grades ranging from 77 to 259 mg/l, with all three projects focused on the Duperow formation.
In relation to the termination of the arrangement with Pristine Lithium, LithiumBank paid a break fee of $3.0 million, and returned a deposit of $250,000.
“LithiumBank’s objective is to maximize shareholder value and to lay the foundation for a thriving lithium district in western Canada. The agreement provides the Company non-dilutive capital while also raising the profile and potential of the geological district that includes the Company’s Flagship Boardwalk Project and its larger look-a-like Park Place Project in west central Alberta,” commented Paul Matysek, LithiumBank’s executive chairman.
LithiumBank Resources last traded at $1.02 on the TSX Venture.
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