RE:Wake up, wake up!! VICTORIA, BC / ACCESSWIRE / June 17, 2021 / Erin Ventures Inc. ("Erin" or the "Company") (TSXV:EV) is pleased to report that it has entered into a definitive, binding option and joint venture agreement (the "Agreement") with Temas Resources Corp. ("Temas") for the joint development of Erin's Piskanja Borate Project, located in Serbia ("Piskanja").
Agreement Summary
Pursuant to the Agreement, Temas may earn a 50% interest in Piskanja by (a) issuing to Erin 250,000 common shares and 250,000 warrants (48 months, at an exercise price equal to the market price less the maximum allowable discount pursuant to stock exchange policies), and (b) incurring an aggregate of €10,500,000 in expenditures on Piskanja. The Agreement may be terminated in certain circumstances, including by Erin if certain milestones are not met in accordance with specified timelines. Upon exercise of the option by Temas, a joint venture will be formed and Erin and Temas will become associated as joint venturers to further advance Piskanja.
"We are extremely pleased to have completed this agreement with Temas" said Tim Daniels, CEO of Erin. "Both companies are excited to move forward on the project as expeditiously as possible. Temas brings a broad array of technical, financial, and business development skill sets to the venture, which will be a tremendous benefit as we progress with the development at Piskanja."
Michael Dehn, CEO of Temas added, "We are very pleased to enter into this definitive option agreement with Erin Ventures. Temas looks forward to our joint venture so as to further develop the Piskanja Property in Serbia".
About Piskanja Boron Property
Erin's wholly-owned subsidiary, Balkan Gold d.o.o. ("Balkan Gold"), holds Erin's rights to Piskanja, Erin's boron deposit with an indicated mineral resource of 7.8 million tonnes (averaging 31.0 per cent B2O3), and an inferred resource of 3.4 million tonnes (averaging 28.6 per cent B2O3), calculated in accordance with the Canadian Institute of Mining Definition Standards on Mineral Resources and Reserves ("CIM Standards"), as disclosed in Erin's report titled, "Mineral Resource Estimate Update On The Piskanja Borate Project, Serbia, October 2016 - Amended February 28 2019" - prepared by SRK Consulting (UK) Ltd. The responsible persons for the Updated MRE are Dr Mike Armitage (C.Eng. C.Geol.) and Dr Mikhail Tsypukov who are both full time employees of SRK, Qualified Persons in accordance with CIM Standards, and independent of Erin and Balkan Gold.
The main commercial terms contained in the Agreement as are follows:
- Temas has an exclusive, immediate, and irrevocable option, subject to the terms herein, to earn up to a 50% equity interest in the Property ("Property" defined as the Piskanja license area and Erin's contractual option interest in the adjacent Jarandol licensed area).
- Upon receiving requisite regulatory approval, Temas will make a one-time payment of 250,000 Temas common shares and 250,000 Temas common share purchase warrants (exercisable at $1.00 for a 4-year term) to Erin.
- Temas may exercise the option, forming the joint venture (the "Joint Venture") becoming a full 50/50 joint venture participant ("JV Participant") in the Property by expending a total of €10.5 million towards the development of the Property (the "Option").
- The parties have agreed upon certain project development milestones which include the scope of development work, timelines, and budgets that are in accordance with Serbian Mining Regulations. The parties agree to use their best efforts to complete all of the development milestones as soon as practicable, but in any event no later than the timelines allowed by Serbian Mining Regulations. *
- Temas has the right to accelerate the Option expenditures.
- Each €210,000 advanced by Temas towards the development of the Property, will earn Temas a one per cent (1%) undivided equity interest in the Property (to a maximum 50% equity interest).
- Balkan Gold will remain the operator on the Property (the "Operator") until such time as Temas has exercised the Option and earned its 50% interest in the Joint Venture, at which point Temas has the right to become Operator.
- During the Option period, expenditures towards development of the Property will be funded 100% by Temas and will only be incurred under and pursuant to programs prepared by the Operator and approved by the technical committee set out in the Agreement (the "Technical Committee").
- The Operator is responsible to manage, direct and control all exploration, development and producing operations in and under the Property.
- The Technical Committee will be comprised of one member and one alternate member from each of Erin and Temas who will approve, modify, or reject any Program, Feasibility Report, Production Program or Operating Plan proposed by the Operator or the other JV Participant.
- Upon acquisition of 50% interest in the Property by completing its Option expenditures, Temas will be entitled to representation on the board of a JV company (either Balkan Gold, or a new entity specifically established for the Joint Venture) that will conduct the activities on behalf of the JV Participants (the "JV Company").
- Upon formation and organization of the JV Company, the Agreement will be replaced with an operating or shareholders' agreement governing the JV Company, (based upon the terms and principles of the Agreement) encompassing operating rules, voting rights and dilution provisions, among other rights regarding the governance of the JV Company (the "Shareholders' Agreement").
- After Temas has completed the exercise of the Option by expending €10.5 million towards the development of the Property, expenditures will be funded jointly and equally by the JV Participants, pursuant to programs prepared by the Operator and approved by the Technical Committee.
- In the event that either party chooses not to fulfill its funding obligation after the exercise of the Option by Temas, that party's interest in the JV Company will be diluted. If either JV Participant's interest falls below 10% of the Joint Venture, such ownership is converted to a 2% net smelter royalty or 10% of net profits interest, subject to certain terms and conditions.
- The Agreement is subject to requisite regulatory and shareholder approvals as may be required, including Erin receiving the approval of the TSX Venture Exchange.
*Note: In accordance with Serbian Mining Regulations, the parties have until 25/09/2023 to complete the first milestone which is essentially comprised of a Serbian-compliant Resource Calculation, Feasibility Study, and Hydrological Study, and receive approval of same. The parties then have until 25/09/2025 to complete designs for mining and processing facilities, and an environmental impact study,and receive approval of same. The parties then have until 25/09/2030 to complete the mine construction, and receive approval of same.
The Agreement in its entirety will be available on the Company's filed documents at www.sedar.com
On behalf of the Board of Directors
Tim Daniels
About Erin Ventures Inc.
Erin Ventures Inc. is an international mineral exploration and development company with boron assets in Serbia. Headquartered in Victoria, B.C., Canada, Erin's shares are traded on the TSX Venture Exchange under the symbol "EV". For detailed information please see Erin's website at www.erinventures.com or the Company's filed documents at www.sedar.com.
About Temas Resources Corp.
Temas Resources Corp. ("Temas Resources") (TMAS) (TMASF) (26P) is focused on the advancement of mineral independence and the processes in which minerals are extracted in an environmentally friendly manner. Temas Resources invests in and works to apply green technology across its mining portfolio to reduce the environmental impact and carbon footprint of metal extraction through advanced processing and patented leaching technologies. Temas Resources is advancing Fe-Ti-V projects in Quebec and soon expects to be active on Boron Projects in Serbia.