Champion Electric Signs Definitive Option Agreement to Sell Its Baner Gold Project in Idaho, USA
Champion Electric Signs Definitive Option
Agreement to Sell Its Baner Gold Project in
Idaho, USA
Toronto, Ontario--(Newsfile Corp. - July 24, 2024) -
Champion Electric Metals Inc.
(CSE: LTHM)
(OTCQB: CHELF) (FSE: 1QB0) ("
Champion Electric
" or the "
Company
") is pleased to announce that
it has signed a binding option agreement with Prestwick Capital Corporation Limited (TSXV: PWIK.P)
("
Prestwick
") for the sale of 100% undivided interest in and to the mineral complains comprising of the
Company's Baner Gold Project in Idaho County, Idaho, USA (the "
Baner Gold Project
").
The Baner Gold Project, a highly prospective gold property, is comprised of 215 unpatented lode claims
covering approximately 3,818 acres. Following the purchase of Baner Gold Project in 2015, Champion
made several discoveries of gold exploration zones along trend from operations including the Friday
Gold Mine located 5 miles south of the Baner Gold Project property boundary. Following a corporate
transition into battery metals, the Baner Gold Project became a non-core asset.
Jonathan Buick, President, and CEO commented
:
"We are pleased to have arrived at an
agreement with Prestwick for Baner.
The founders of the company are the same team that have
founded, financed and developed numerous world class mining operations and companies including
Kirkland Lake Gold and Rupert Resources.
Prestwick will be led by seasoned mining executive Brian
Hinchcliffe along with exploration and production geologist Mike Sutton.
The Baner project is well
located and hosts very exciting gold exploration zones. Idaho County is extremely supportive of
exploration, we look forward to sharing in Prestwick's success."
Option Agreement Terms
Under the terms of the Option Agreement, Champion agrees to grant the Option to the Prestwick.
In
order to exercise the Option and keep it in good standing, Prestwick has agreed to make cash
payments and issues securities to Champion as follows:
1
.
On completion of the Transaction, Champion Electric will receive:
a
.
Cash payment of CAD$75,000;
b
.
1.1 million common shares of Prestwick ("
Common Shares
"); and
c
.
warrants to purchase up to 200,000 Common Shares at $0.30 per share for two (2) years
from the date of issuance.
2
.
Within 18 months from the completion of the Transaction, the Company to receive ("
Payment #1
Date
"):
a
.
Cash payment of CAD$350,000;
b
.
200,000 Common Shares; and
c
.
warrants to purchase up to 200,000 Common Shares at the last closing price for the
Common Shares prior to the date of issuance, for two (2) years from the date of issuance
3
.
Within 12 months from the Payment #1 Date, Champion to receive ("
Payment #2 Date
"):
a
.
Cash payment CAD$500,000; and
b
.
warrants to purchase up to 200,000 Common Shares at the last closing price for the
Common Shares prior to the date of issuance, for two (2) years from the date of issuance.
As part of the agreement, during the term of the Option, Prestwick will have the exclusive right to manage
and operate all work programs carried out on the Baner Gold Project in its sole discretion.
Prestwick will
also be responsible for maintaining the Baner Gold Project in good standing through such time.
Additionally, upon satisfaction of the payments and securities issuances presented in the binding
agreement, the Option will be deemed to be exercised and a 100% undivided interest in the Baner Gold
Project will be transferred to Prestwick, free and clear of all encumbrances, subject to a 1% net smelter
return royalty (the "
NSR
") in favour of the Company. Prestwick may buy-back the NSR in consideration
for payment of $7.5 million to Champion Electric.
The Common Shares issuable under the Option will be deemed to be issued at a price equal to $0.235
per share, being the price of the Common Shares on the Exchange on May 13, 2024.
These Common
Shares will be subject to hold periods under applicable securities laws, and subject to voluntary escrow.
Voluntary Escrow
Upon completion of the Transaction, it is proposed that the Prestwick and Champion Electric, along with
an escrow agent, will enter into an escrow agreement providing for voluntary escrow as follows: (i) the
Common Shares issued to the Company upon completion of the Transaction (including any Common
Shares issued on exercise of the warrants issued on that date) will be subject to voluntary escrow until
the Payment #1 Date; and (ii) the Common Shares issued to Champion Electric on the Payment #1
Date (including any Common Shares issued on exercise of the warrants issued on that date) will be
subject to voluntary escrow until the Payment #2 Date.
Conditions of Completion of the Transaction
As Prestwick is a Capital Pool Company, this Option Agreement is subject to Prestwick's pending
approval for a "Qualifying Transaction".
The completion of the Transaction is subject to a number of
conditions, including Toronto Venture Exchange ("TSX-V") approval, obtaining all necessary third-party
consents and the Baner Gold Project satisfying the TSX-V's Initial Listing Requirements for a Mining
Issuer (pursuant to Policy 2.1 -
Initial Listing Requirements
of the Exchange), including, without
limitation, the public float requirements.
About Champion Electric Metals Inc.
Champion Electric is a discovery-focused exploration company that is committed to advancing its highly
prospective lithium properties in Quebec, Canada and cobalt properties in Idaho, United States. In
addition, the Company owns the Baner gold project in Idaho County (optioned to Prestwick Capital
Corporation) and the Champagne polymetallic project in Butte County near Arco. The Company's shares
trade on the CSE under the trading symbol "LTHM", on the OTCQB under the trading symbol "CHELF",
and on the Frankfurt Stock Exchange under the symbol "1QB0". Champion Electric strives to be a
responsible environmental steward, stakeholder, and contributing citizen to the local communities where
it operates, taking its social license seriously, employing local community members and service
providers at its operations whenever possible.
ON BEHALF OF THE BOARD OF CHAMPION ELECTRIC
"Jonathan Buick"
Jonathan Buick, President, and CEO
To learn more, please visit the Company's SEDAR profile at
www.sedarplus.ca
or the Company's
corporate website at
www.champem.com
.
For further information, please contact:
Investor Relations and Communications
Phone: (+1) 416-567-9087
Email:
THIS PRESS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY ANY SECURITIES IN ANY JURISDICTION, NOR SHALL THERE BE ANY OFFER,
SALE, OR SOLICITATION OF SECURITIES IN ANY STATE IN THE UNITED STATES IN WHICH SUCH
OFFER, SALE, OR SOLICITATION WOULD BE UNLAWFUL.
Cautionary Statements
Neither the Canadian Securities Exchange nor its regulation services provider has reviewed or
accepted responsibility for the adequacy or accuracy of this press release. This press release may
include forward-looking information within the meaning of Canadian securities legislation, concerning
the business of the Company. Forward-Looking information is based on certain key expectations and
assumptions made by management of the Company, including closing of the Transactions and the
prospectivity of the Projects for lithium. Although the Company believes that the expectations and
assumptions on which such forward-looking information is based on are reasonable, undue reliance
should not be placed on the forward-looking information because the Company can give no
assurance that they will prove to be correct. Forward-Looking statements contained in this press
release are made as of the date of this press release. The Company disclaims any intent or obligation
to update publicly any forward-looking information, whether as a result of new information, future
events or results or otherwise, other than as required by applicable securities laws.
The Projects are at an early stage of exploration, and the Company cautions that the qualified
persons who have reviewed and approved this news release have not verified scientific or technical
information produced by third parties.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/217550