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Latin Metals Approves the Sale of El Quemado Lithium Project for $0.9 Million

Latin Metals Inc. announced that they have signed a contract with South American Lithium Ltd. (SAL), under which SAL would pay a total of $900,000 to acquire Latin Metals’ 100% stake in the El Quemado lithium project, which is situated in the Province of Salta, in Argentina. A 2% net smelter returns royalty on the project will be kept by Latin Metals. Unless otherwise stated, all references to dollars are to amounts in Canadian dollars.

Image Credit: Mark Agnor/Shutterstock.com

Agreement Details

According to the provisions of the Agreement, SAL will give Latin Metals 1,000,000 units and a cash payment of $400,000 within ten days of the agreement’s signing.

Each unit will have 1,000,000 common shares in the capital of SAL (issued at a deemed price of $0.50) and 1,000,000 share purchase warrants, each of which has a five-year option to be exercised for an equal number of common shares at $1.00 per share.

Latin Metals will keep the 2% NSR Royalty from any future production on the project; SAL can, at any time prior to production, acquire the other half of the 2% NSR Royalty (1.0%) from Latin Metals for US$3,000,000 in cash.

This transaction is consistent with Latin Metals’ strategy to monetize non-core assets, like El Quemado, while retaining a royalty interest, in this case, the 2.0% NSR Royalty on future production from the Project. Consideration of $900,000 provides the Company with $400,000 of non-dilutive cash as well as $500,000 in securities which provides Latin Metals with exposure to the project’s future success.

Keith Henderson, President and Chief Executive Officer, Latin Metals Inc.

Henderson added, “South American Lithium is a private Canadian company which is currently finalizing a going-public transaction. The royalty-focused structure of this transaction reflects our view that SAL has significant technical and management experience in Argentina, and we would like to wish SAL’s management team every success in moving the Project forward.

Source: https://latin-metals.com/

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