Laramide Resources Closes Churchrock and Crownpoint Acquisition
Jan 6, 2017
Listed (TSX:LAM; ASX:LAM)
TORONTO, Jan. 6, 2017 /CNW/ - Laramide Resources Ltd. ("Laramide" or the "Company") is pleased to announce that it has closed its previously announced acquisition of the Churchrock and Crownpoint properties in New Mexico, USA (the "Projects") from Uranium Resources Inc. ("URI"), pursuant to which Laramide acquired URI's wholly owned subsidiary Hydro Resources, Inc., which owns the Projects. Details related to the acquisition were previously provided by Laramide in press releases dated November 10, 2015, April 8, 2016, December 5, 2016 and December 16, 2016.
The Projects are principally comprised of the 100% owned Churchrock and Crownpoint projects which have near-term development potential and significant mineral resources. They are located within a large land package in the heart of the Grants Mining District in McKinley County, New Mexico, one of the most historically significant uranium-producing districts in the U.S.
The Projects are subject to net smelter royalties, specifically the sliding scale royalty, owned by Laramide of up to 25% of gross revenue covering certain areas of the Projects which made them less economical. In addition, other key properties included in the acquisition were recently consolidated by URI. Therefore, following the acquisition by Laramide a leading In Situ Recovery ("ISR") division is created operating in a tier one jurisdiction with enhanced overall project economics and potential low operating costs.
Total consideration paid by Laramide to URI consisted of US$2.5 million in cash ($250,000 of which was previously paid), the issuance by Laramide to URI of 2,218,333 units ("Units"), a promissory note in the amount of US$5.0 million with three anniversary payments due on January 5, 2018 (US$1.5 million), 2019 (US$1.5 million), and 2020 (US$2.0 million), and a retained net smelter royalty on the Projects valued at US$4.5 million. The transaction took over a year to complete and includes the approval from the U.S. Nuclear Regulatory Commission to transfer materials licenses for the properties to Laramide.
Each Unit consists of one common share in the capital of the Company and one share purchase warrant (a "Warrant"), with each Warrant entitling the holder to purchase one additional common share at a price of C$0.45 for a period of 60 months from the date of closing of the Offering. In the event that the common shares trade at a price of C$1.00 or greater for a period of 10 consecutive trading days, the Company may accelerate the expiry date of the Warrants by giving notice to the holders and, in such case, the Warrants will expire on the 30th business day after the date on which such notice is given by the Company. The common shares and Warrants issued pursuant to URI are subject to a statutory four-month hold period expiring on May 6, 2017. The exercise of the Warrants issued to URI shall be subject to the approval by shareholders of the Company by way of a simple majority of votes cast in respect of such matter.
Overview of Projects
Marc Henderson, President and Chief Executive Officer of the Company, stated, "We are pleased to have been able to work cooperatively with URI to complete the transaction and to introduce the Churchrock and Crownpoint properties as a new cornerstone asset cementing our strategy of developing low-cost uranium assets in tier one jurisdictions. We now look forward to further development of this high quality ISR asset and getting to work on advancing Churchrock in 2017."
To learn more about Laramide, please visit the Company's website at www.laramide.com.
About Laramide Resources:
Laramide is engaged in the exploration and development of high-quality uranium assets. Its wholly owned uranium assets are in Australia and the United States. Laramide's portfolio of advanced uranium projects have been chosen for their production potential. Its flagship project, Westmoreland, in Queensland, Australia, is one of the largest projects currently held by a junior mining company. Its U.S. assets include Churchrock, Crownpoint ISR projects and La Jara Mesa in Grants, New Mexico, and La Sal in the Lisbon Valley district of Utah.
Forward-looking Statements and Cautionary Language
This News Release contains forward looking statements which are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward looking statements. The Company does not intend to update this information and disclaims any legal liability to the contrary.
Further, the company is not aware of any new information or data that materially affects the historical resource estimate information included in the market announcement of 10 Nov 2015.
SOURCE Laramide Resources Ltd.
For further information: Marc Henderson, President and Chief Executive Officer, Toronto, Canada +1 (416) 599 7363; Bryn Jones, Chief Operating Officer, Brisbane, Australia, P: (07) 3831 3407; Greg Ferron, Vice-President, Toronto, Canada +1 (416) 599 7363