- Long form transaction documentation executed after successful completion of due diligence
- LPI has received A$1M of the purchase price, completing the initial payment
- Balance of funds due on or before 30 April 2018
As announced on 7 September 2017, the Company entered into a Term Sheet with Albertson Resources Pty Ltd to dispose of 100% of the shares in Lithium Power International Holdings (Argentina) Pty Ltd, LPI's wholly-owned Australian subsidiary that holds LPI's interest in the Centenario project (the "Transaction").
Following a successful due diligence process, LPI is pleased to advise that it has entered into binding contracts with Centenario Lithium Limited (the "Purchaser"), the nominee of Albertson Resources Pty Ltd, to effect the Transaction.
The Purchaser has advanced a total of A$1M to LPI to complete its initial payment obligations under the Transaction documentation.
The Transaction is scheduled for completion on or before 30 April 2018. At completion, the Purchaser will be required to pay an additional A$3M in cash to the Company.
In certain circumstances (involving a successful fundraising by the Purchaser), the Purchaser may elect to make the completion payment via paying LPI A$1.75M in cash and A$1.5M in shares of the Purchaser (at the price implied by the successful fundraising), which could result in a $250,000 premium for LPI.
The cash price will be reduced by $250,000 in the event that a specified tenement is not transferred to the target group.
In addition, the Purchaser is required to:
- pay to LPI a success fee of $375,000 on announcement of a maiden JORC resource above of at least 250,000 tonnes of lithium carbonate equivalent; and
- grant to LPI a royalty of 1.5% on gross revenues earned from Centenario for a period of 20 years commencing on the date of finalization of a definitive feasibility study.
Lithium Power International's Chief Executive Officer, Martin Holland, commented:
"The Board of LPI is pleased to announce execution of the Transaction documentation following successful completion of Centenario Limited's due diligence on Centenario and receipt of advance payment of a total of A$1M in cash. The smooth due diligence process has led to the parties to agree to proceed with the Transaction. This is a positive sign for the Centenario project and LPI, and we look forward to completing the Transaction with the Purchaser in early 2018."
About Lithium Power International Ltd
Lithium Power International Limited (ASX:LPI) (FRA:24L) is a pure-play lithium explorer and developer, focusing on developing and fast-tracking to production the high-grade Maricunga lithium brine project in Chile.
LPI has a well known performing technical team with the experience to take the Maricunga project all the way through the development stages to production.
The regions that LPI is currently focussed on are:
1. Maricunga JV (Chile) – On 13th September 2016, Lithium Power announced the creation of a new JV to develop the world-class Maricunga lithium brine deposit in northern Chile.
2. Pilbara (Western Australia) – LPI has one granted exploration tenement and two pending exploration applications covering 203km2 in the Pilbara region of northern Western Australia. The largest granted exploration tenement is at Pilgangoora-Houston Creek is 2-3km west of the Pilbara Minerals (ASX:PLS) and Altura Mining (ASX:AJM) lithium deposits.
3. Greenbushes (Western Australia) – LPI has two granted exploration tenements covering 400km2 in the Greenbushes area of southern Western Australia. The tenements are adjacent to the world’s largest hard rock lithium mine owned & operated by Tianqi/Talison.
4. Centenario (Argentina) –Through its Argentinian subsidiary, Lithium Power holds a total of 6 granted tenements in the Centenario lithium brine salar within the Salta province of the Puna Plateau. In total, the 6 granted tenements cover an area of 61.52km2. In addition, there is 1 further tenement in the grant review stage.
With the exception of the Maricunga JV, all tenements are 100% owned by LPI or LPSA (including rights to the Centenario tenement which is the subject of review by the Argentinian mining authorities).
Lithium Power International Ltd