All dollar amounts are in U.S. dollars unless
otherwise indicated.
TORONTO, June 5, 2017 /CNW/ - LSC Lithium Corporation (the
"Company" or "LSC") (TSXV: LSC) is pleased to
announce that it has completed the previously announced acquisition
of:
- the tenements and other mineral rights held by Orocobre Limited
("Orocobre"), South American Salars SA ("SAS") and
Borax Argentina SA ("BA") (collectively, the "Orocobre
Group") located in the Salinas Grandes Salar, in Salta and
Jujuy provinces, Argentina,
covering approximately 25,027 hectares; and
- the option from Advantage Lithium Corporation
("Advantage") over the 1,471 hectare Stella Marys Project
located in the Salinas Grandes Salar, in Salta province,
Argentina.
These acquisitions increase LSC's land package on the Salinas
Grandes Salar bringing LSC's portfolio of lithium brine salars to
approximately 300,000 hectares, which represents extensive lithium
prospective salar holdings in Argentina, and which, together with LSC's
existing tenements, cover 86% in the centre of the Salar in Salta
province and 45% of the centre of the Salar in Jujuy province. In
the Jujuy province, a large portion of the Salar is also controlled
by the cooperatives.
TERMS OF THE ACQUISITION OF THE SALINAS GRANDES
TENEMENTS
Pursuant to the agreement made on March
28, 2017, as amended on June 2,
2017 (the "LSC-Orocobre Agreement") among LSC, its
Argentine subsidiary Lithium S Corporaiton S.A. ("LSCSA"),
and the Orocobre Group, LSC has (through LSCSA) acquired: (a) all
tenements held by the Orocobre Group located in the Salinas Grandes
Salar, in Salta and Jujuy provinces, Argentina, (the "Salinas Grandes
Tenements"); (b) interests in the portion of a mining
exploration application (cateo) that is in proximity to the Salinas
Grandes Tenements in Jujuy province; (c) a royalty held by Orocobre
in certain tenements located on the Salar de Pozuelos in Salta
province owned by LitheA Inc. (which company is being acquired by
LSC as disclosed in its news release dated March 15, 2017); and (d)
certain usufruct rights to extract borates located in the Salinas
Grandes Salar.
In connection with, and as consideration for, the acquisition,
LSCSA:
(a)
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has transferred to
Orocobre three tenements in the Salar de Olaroz located in Jujuy
province covering approximately 3,821 hectares;
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(b)
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has paid to Orocobre
$4 million at closing;
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(c)
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will pay to Orocobre
$1 million on each of the 1st and 2nd
anniversaries of closing and $944,630 on the 3rd
anniversary of closing; and
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(d)
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has granted to an
affilate of Orocobre a 2% royalty on the brine concentrate produced
from the Salinas Grandes Tenements, calculated using the same
methodology applied by Orocobre and its affiliates for the
calculation of the royalties paid by Orocobre or its affiliates to
the provincial government of Jujuy for Orocobre's last two fiscal
years (the "Salinas Grandes Royalty") regardless of any
retroactive or future changes to such methodology made after
December 31, 2016.
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Payment of the deferred cash consideration may be postponed to
the 4th anniversary of closing and/or subject to
reduction of up to $1,222,712 at
LSC's option in the event that valid title to certain mineral
interests covering up to 4,503 hectares cannot be transferred to
LSCSA within three years of closing. LSC has guaranteed the payment
obligations of LSCSA for the deferred cash consideration.
In addition, each of Orocobre and BA has agreed to:
(a) a 10 year exclusion area covering the 10 km area from the
external perimeter of any of the Salinas Grandes Tenements, and (b)
a 10 year non-interference zone respecting all properties held by
LSC located south of Río Las Burras.
TERMS OF THE ACQUISITION OF STELLA MARYS
PROJECT
Pursuant to the agreement made on March
28, 2017 (the "LSC-Advantage Agreement") between LSC
and Advantage, LSC has acquired from Advantage its option over the
1,471 hectare Stella Marys Project located in the Salinas Grandes
Salar, in Salta province, Argentina (the "MSR Option"). The MSR
Option is governed by an agreement with Minera Santa Rita SRL
("MSR") dated October 27, 2016
(the "MSR Option Agreement") and the LSC-Advantage
Agreement.
On closing, Advantage assigned the MSR Option to LSC in exchange
for:
(a)
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LSC making aggregate
cash payments of approximately $690,000 to Advantage in
reimbursement of option payments and related expenses previously
paid by Advantage pursuant to the MSR Option Agreement and a
commitment to pay up to an additional $48,000 in finder's fees
payable by Advantage;
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(b)
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LSC issuing 256,520
LSC common shares to Advantage as reimbursement for the 600,000
Advantage shares previously issued by Advantage to MSR pursuant to
the MSR Option Agreement.
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LSC has the right to acquire the Stella Marys Project pursuant
to the exercise of the MSR Option prior to Setpember 21, 2017
by:
(a)
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making a cash payment
of $650,000 to MSR;
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(b)
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issuing to Advantage
a number of LSC common shares (calculated on the basis of the
proportionate closing prices of the LSC common shares and Advantage
common shares on the trading day preceding the date of
closing of the MSR Option exercise), as reimbursement for the
issuance by Advantage of the 900,000 Advantage common shares to MSR
in connection with the exercise of the MSR Option; and
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(c)
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entering into a
royalty agreement with Advantage with respect to a 2% royalty on
the brine concentrate produced from the Stella Marys Project that
will be granted by LSC to Advantage, calculated using the same
methodology as used for the Salinas Grandes Royalty.
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Advantage has agreed to: (a) a 10 year exclusion area covering
the 10 km area from the external perimeter of any of the Salinas
Grandes Tenements, and (b) a 10 year non-interference zone
respecting all properties held by LSC located south of Rio Las
Barros, subject in each case to an exclusion in respect of
tenements held by Advantage in the Guayatayoc area.
The 256,520 LSC common shares issued to Advantage are subject to
a 4-month hold period until October 3,
2017.
Qualified Person/Data Verification
The scientific and technical information included in this press
release related to LSC tenements is based upon information prepared
and approved by Donald H. Hains,
P.Geo. Donald H. Hains is a
qualified person, as defined in NI 43-101 and is independent of
LSC, Orocobre and Advantage. No Qualified Person has reviewed or
verified any information in this press release related to the
Orocobre tenements to be acquired by LSC.
ABOUT LSC LITHIUM CORPORATION:
LSC Lithium is an emerging lithium producer that has amassed a
large portfolio of prospective lithium rich salars. LSC is focused
on developing its tenements located in five salars: Pozuelos,
Pastos Grandes, Rio Grande, Salinas Grandes and Jama. All LSC
tenements are located in the "Lithium Triangle," an area at the
intersection of Argentina,
Bolivia and Chile where the world's most abundant lithium
brine deposits are found. LSC Lithium has a land package portfolio
totaling approximately 300,000 hectares, which represents extensive
lithium prospective salar holdings in Argentina.
Forward-Looking Statements
Certain statements contained in this news release constitute
forward-looking information. These statements relate to future
events or future performance, including statements as to the
following: the timing, ability and right to acquire any tenements
or exploration applications from the Orocobre Group after closing
of the transaction; the timing or completion of the acquisition of
the Stella Marys Project through exercise of the MSR Option; the
amount of hectares and expected control by LSC of the tenements on
Salinas Grande after closing of the acquisitions. The use of
any of the words "could", "intend", "expect", "believe", "will",
"projected", "estimated" and similar expressions and statements
relating to matters that are not historical facts are intended to
identify forward-looking information and are based on LSC's current
belief or assumptions as to the outcome and timing of such future
events. Whether actual results and developments will conform with
LSC's expectations is subject to a number of risks and
uncertainties including factors underlying management's
assumptions, such as risks related to: title of the Orocobre and
Advantage Lithium tenements and their ability to be transferred
post-closing; title, permitting and regulatory risks; exploration
and the establishment of resources and reserves on the Salinas
Grande tenements or other LSC properties; volatility in lithium
prices and the market for lithium; exchange rate fluctuations;
volatility in LSC's share price; the requirement for significant
additional funds for development that may not be available; changes
in national and local government legislation, including permitting
and licensing regimes and taxation policies and the enforcement
thereof; regulatory, political or economic developments in
Argentina or elsewhere;
litigation; title, permit or license disputes related to interests
on any of the properties in which the Company holds an interest;
excessive cost escalation as well as development, permitting,
infrastructure, operating or technical difficulties on any of the
Company's properties; risks and hazards associated with the
business of development and mining on any of the Company's
properties. Actual future results may differ materially. The
forward-looking information contained in this release is made as of
the date hereof and LSC is not obligated to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
applicable securities laws. Because of the risks, uncertainties and
assumptions contained herein, investors should not place undue
reliance on forward-looking information. The foregoing statements
expressly qualify any forward-looking information contained herein.
For more information see the Company's filing statement on SEDAR
at www.sedar.com.
Neither the TSX Venture Exchange Inc. nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
The TSX Venture Exchange Inc. has neither approved nor
disapproved the contents of this press release.
SOURCE LSC Lithium Corporation