- Free Battery Metal (CSE:FREE) announced the signing of a binding term sheet with Snow Lake Resources Ltd. (NASDAQ:LITM)
- This agreement allows Snow Lake to earn up to an 80 per cent interest in Free Battery’s Mound Lake property, located in northwestern Ontario
- Snow Lake holds a 10 per cent interest in the property and can increase its stake by making work expenditures of at least C$1 million
- Free Battery Metal stock opened trading at $0.03
Free Battery Metal (CSE:FREE) announced the signing of a binding term sheet with Snow Lake Resources (NASDAQ:LITM), operating as Snow Lake Energy. This agreement allows Snow Lake to earn up to an 80 per cent interest in Free Battery’s Mound Lake property, located in northwestern Ontario.
Transaction summary
Under the terms of the agreement outlined in a news release, Snow Lake, which currently holds a 10 per cent interest in the Mound Lake property, can increase its stake through a series of work expenditures and cash payments:
- First option: On or before the first anniversary of the definitive agreement, Snow Lake can acquire an additional 41 per cent interest (for a total of 51 per cent) by:
- Making work expenditures of at least C$1 million.
- Paying C$500,000 to Free Battery.
- Second option: On or before the second anniversary of the definitive agreement, Snow Lake can acquire an additional 29 per cent interest (for a total of 80 per cent) by:
- Making additional work expenditures of C$1 million (for a total of C$2 million).
- Paying an additional C$1 million to Free Battery (for a total of C$1.5 million).
Shortfalls in work expenditures can be compensated by Snow Lake through cash payments to Free Battery.
Operational responsibilities
Prior to completing a pre-feasibility study, Snow Lake will act as the operator of the Mound Lake property, bearing all costs and expenses related to its exploration and development. Post-study, the parties will negotiate a joint venture arrangement to further develop the property. This arrangement will include mechanisms for funding expenditures based on each party’s proportional interest, preparing and approving budgets, and managing the joint venture. If either party’s interest falls below 10 per cent, it will be converted into a 1 per cent net smelter return royalty.
Mound Lake property details
The Mound Lake property consists of 243 single-cell unpatented mineral claims, covering over 48,000 square metres in a prolific mining district. The northern part of the property, near the contact between the Mound Lake Pluton and metasedimentary country rocks, has shown consistent, elevated gallium values. These results align with elevated levels of other critical metals, including beryllium (Be), lithium (Li), and rubidium (Rb), near the Larson Creek and Mound Creek faults.
About Free Battery Metal
Free Battery Metal is exploring lithium, including the Mound Lake property in Ontario. The property includes 243 single-cell unpatented mining claims spanning 486,000 square metres. Historically, there has been little to no mineral exploration on or near the Mound Lake property, making it a promising site for future development.
Free Battery Metal stock opened trading 100 per cent higher from the previous session at $0.03.
Join the discussion: Find out what everybody’s saying about this stock on the Free Battery Metal Bullboard, and check out the rest of Stockhouse’s stock forums and message boards.
The material provided in this article is for information only and should not be treated as investment advice. For full disclaimer information, please click here.
(Top image via Free Battery Metal Ltd.)
