Appia Signs Definitive Agreement to Acquire up to a 70% Interest in Ionic Clay Project, Brazil
2023年6月9日 - 10:30PM
JCN Newswire
Appia Rare Earths & Uranium Corp. (CSE: API) (OTCQX: APAAF)
(FSE: A0I0) (FSE: A0I0.F) (FSE: A0I.MU) (FSE: A0I.BE) (the
"Company" or "Appia") is pleased to announce that, further to its
press releases of March 7, 2023 and May 30, 2023, the Company has
signed a Definitive Agreement (the "Definitive Agreement") with 3S
LTDA ("3S"), Beko Invest Ltd. ("Beko"), Antonio Vitor Junior
("Antonio") and AZ125 Mineracao Ltda (the "Company") to acquire up
to a 70% interest in the PCH Project (the "Transaction") located in
the Tocantins Structural Province of the Brasilia Fold Belt, Goias
State, Brazil (the "Property").
"Appia has taken a significant step in cementing itself among the
upper tier of critical mineral explorers with today's
announcement," stated Stephen Burega, President. "Brazil is
emerging as a significant source of rare earths contained in ionic
clays, and Appia's PCH project will further enhance this potential.
The known rare earth element distribution at PCH should lead to
favourable economics for processing; is easily on par with other
ionic clay projects outside of Asia; and it contains relatively
high levels of the magnetic REEs. Early-stage review of the rare
element distribution indicates a high potential 'basket price'
which is a positive indicator to advance the project. Once
additional analysis is completed, a more detailed summary of known
results will be shared with the market."
Pursuant to the terms of the Definitive Agreement, the Property
will be held by the Company, Appia will hold a 70% interest in the
Company, subject to completing the option obligations referred to
below, and Antonio will hold a 30% interest in the Company. The
initial 500,000 shares (the "Initial Shares") to be issued to Beko
will be issued when certain administrative steps have been
completed in Brazil to perfect the 70% interest of Appia in the
Company (the "Perfection of the Transaction"). A further
announcement will be made when the Initial Shares are to be
issued.
Upon Perfection of the Transaction, Appia can maintain its 70%
interest in the Company by issuing an aggregate of a further 2.0
million common shares of Appia to Beko and spending US$10 million
on the Property over a period of five (5) years (the "Option
Period") after which Appia will have earned a 60% interest in the
Company. If Appia earns its 60% interest, it will then be
obligated, within 90 days of earning its 60% interest, to issue a
further US$1,250,000 of common shares of Appia to Beko to earn a
further 10% interest in the Company. The number of shares to be
issued to earn the further 10% shall be that number of common
shares of Appia equal to the number arrived at by dividing
US$1,250,000 by the greater of the average closing price of the
common shares as quoted on the Canadian Securities Exchange (the
"CSE") for the 30 trading days immediately preceding the
announcement by Appia of its intention to earn the additional 10%
interest and the discounted market price of the common shares of
Appia based on the last closing price immediately preceding the
announcement.
Appia will acquire incremental vested interests in the Company upon
completion of specific expenditure requirements pursuant to the
terms of the Definitive Agreement. Once Appia issues at least a
further 500,000 common shares to Beko and spends at least US$1
million on the Property (at which time it will have earned a 10%
interest in the Company) (the "Initial Obligation"), Beko will be
granted a 1% net smelter returns royalty (the "1% NSR") in the
Property. Appia will have a right of first refusal to acquire the
1% NSR.
Once Appia has earned its 70% interest in the Company, Appia and
Antonio will enter into a joint venture with respect to the further
exploration and development of the Property (the "Joint Venture")
with Appia holding a 70% interest and Antonio holding a 30%
interest in the Company. The Joint Venture will be governed by the
terms of a Quotaholders Agreement to be signed by Appia and Antonio
as part of the Perfection of the Transaction. The Quotaholders
Agreement will act as a unanimous shareholders agreement and a
joint venture agreement with respect to the further exploration and
development of the Property. Upon the formation of the Joint
Venture, Antonio will have 90 days within which to elect to either
(a) participate in the Joint Venture and contribute his pro rata
share of expenditures or be diluted; (b) sell all of his 30%
interest in the Company, subject to a right of first refusal in
favour of Appia; or (c) elect to have Appia fund its pro rata share
of expenditures pursuant to the Joint Venture subject to the right
of Appia to be reimbursed for 150% of the expenditures made by
Appia on behalf of Antonio before any proceeds are paid to
Antonio.
If a party is required to make a contribution pursuant to the Joint
Venture and that party does not make its pro rata contribution to
development expenditures, that party's interest in the Company will
be diluted pro rata based upon that party's deemed and actual
contributions to the Joint Venture relative to the total deemed and
actual contributions to the Joint Venture by both parties. A party
whose interest is diluted to 10% or less shall immediately be
converted to a 1% net smelter returns royalty ("1% Dilution NSR")
with the remaining party's interest converted to a 100% interest in
the Company subject to payment of the 1% Dilution NSR. The
remaining party will have a right of first refusal to purchase the
1% Dilution NSR.
Should Appia fail to make some or all of the expenditures required
in any year, Beko will notify APPIA in writing of such failure,
after which Appia will have 30 days to make the required
expenditure. Failure to make the expenditure within the 30 days
will result in Appia's earned interest being reduced pro rata in
proportion to the amount of money actually expended by Appia in
such year. Appia shall have the right to make additional
expenditures in a subsequent year to earn the balance of the
interest it would have earned had it made the entire expenditure in
the previous year. If Appia fails to expend an aggregate of US$10
million and issue an aggregate of 2,000,000 common shares of Appia
to Beko within the Option Period, Appia may, at any time during the
Option Period after completing the Initial Obligation, notify Beko
that it does not intend to provide any further funding for the
Property (the "Cease Funding Notice"). Upon delivery of the Cease
Funding Notice to Beko, Appia shall have earned the applicable
interest in the Company (the "Earned Interest") and shall transfer
to Antonio that number of quotas of the Company equal to 70% minus
the Earned Interest. Thereafter, Appia shall hold the Earned
Interest in the Company and Antonio shall hold 100% minus the
Earned Interest in the Company. Upon delivery of the Cease Funding
Notice and the adjustment in the interests of Appia and Antonio in
the Company, the parties shall use their commercially reasonable
efforts to determine how to proceed with their respective interests
in the Company.
Background on the PCH Project
The Cachoeirinha Project (PCH Project) is located within the
Tocantins Structural Province in the Brasilia Fold Belt, more
specifically, the Arenopolis Magmatic Arc. The PCH Project is
17,551.07 ha. in size and located within the Goias State of Brazil.
It is classified as an alkaline intrusive rock occurrence with
highly anomalous REE and niobium mineralization. This
mineralization is related to alkaline lithologies of the Fazenda
Buriti Plutonic Complex and the hydrothermal and surface alteration
products of this complex by supergene enrichment in a tropical
climate. The positive results of the recent geochemical exploration
work carried out to date indicates the potential for REEs and
Niobium within lateritic ionic adsorption clays.
The technical content in this news release was reviewed and
approved by Mr. Don Hains, P.Geo, Consulting Geologist, and a
Qualified Person as defined by National Instrument 43-101.
About Appia Rare Earths & Uranium Corp (Appia)
Appia is a publicly traded Canadian company in the rare earth
element and uranium sectors. The Company is currently focusing on
delineating high-grade critical rare earth elements and gallium on
the Alces Lake property, as well as exploring for high-grade
uranium in the prolific Athabasca Basin on its Otherside, Loranger,
North Wollaston, and Eastside properties. The Company holds the
surface rights to exploration for 113,837.15 hectares (281,297.72
acres) in Saskatchewan. The Company also has a 100% interest in
12,545 hectares (31,000 acres), with rare earth element and uranium
deposits over five mineralized zones in the Elliot Lake Camp,
Ontario.
Appia has 130.5 million common shares outstanding, 143.5 million
shares fully diluted.
Cautionary Note Regarding Forward-Looking Statements: This News
Release contains forward-looking statements which are typically
preceded by, followed by or including the words "believes",
"expects", "anticipates", "estimates", "intends", "plans" or
similar expressions. Forward-looking statements are not a guarantee
of future performance as they involve risks, uncertainties and
assumptions. We do not intend and do not assume any obligation to
update these forward- looking statements and shareholders are
cautioned not to put undue reliance on such statements.
Neither the Canadian Securities Exchange nor its Market Regulator
(as that term is defined in the policies of the CSE) accepts
responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Tom Drivas, CEO and Director: (cell) 416-876-3957, (fax)
416-218-9772 or (email) tdrivas@appiareu.com
Stephen Burega, President: (cell) 647-515-3734 or (email)
sburega@appiareu.com
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