Major developmenthttps://youtu.be/t_WKuHTk6KM
Subject to the acquisition by Silver Elephant of 100% of the Company’s debt held by the Company’s secured lender (the “Secured Debt”) and the restructuring, as defined in the APA, of the Secured Debt, the APA provides for consideration to the Company as follows:
·A US$6,675,000 credit against certain secured debt owed by Victory Nickel to Silver Elephant at closing (the “Property Payment”).
·US$5,000,000 in Silver Elephant common shares (“Consideration Shares”) to be issued in three tranches over a one-year period.
·Subscription by Silver Elephant for common shares of Victory Nickel for aggregate gross consideration of C$1,000,000.
·An agreement to issue to Victory Nickel C$2,000,000 in Silver Elephant common shares, upon the price of nickel exceeding US$10.00 per pound for 30 consecutive business days on or before December 31, 2023.
·Upon receipt of an independent economic study in respect of the Minago Project, Silver Elephant will credit the remainder of the balance owing under the secured debt owed to Silver Elephant.
·A right of first refusal on the exploitation of the Minago frac sand resource. “The Board of Directors has worked extremely hard to preserve value and the ability to move the Company forward for the benefit of all the stakeholders of Victory Nickel,” said Sean Stokes, Interim CEO of the Company. “The execution of this transaction would ultimately eliminate the Company’s Secured Debt, give management the opportunity to restructure its unsecured debt and inject sufficient liquidity to support the efforts to advance the Company’s operations to build value for stakeholders while allowing continued participation in the upside of the Minago project both in terms of the nickel and sandstone resources.” In addition to significant ownership of Silver Elephant shares and optionality at Minago, upon closing, the Company will continue to own the Mel and Lac Rocher deposits, both containing NI-43-101 sulphide nickel resources and its revenue-generating 7P sand processing facility in Alberta (the “7P Plant”). The Company has also identified a significant frac sand resource in close proximity to the 7P Plant which will allow it to compete in the market for domestic frac sand and retains option to exploit an 11 million ton National Instrument 43-101 sand resource on the Bear Coulee frac sand property located in Trempeleau County, Wisconsin.