This means Kodal Minerals has set the second share placing to invest up to £4.3 million in the company in two tranches in motion.
The first tranche of £3.3 million has already been received by Suay Chin International. In addition, the parties have entered into a binding term sheet in relation to the terms on which the parties will negotiate an extended off-take agreement for between 80% and 100% of the spodumene product produced at the company’s Bougouni lithium project in southern Mali for a period of three years, an increase from the 20% of production previously announced.
Highlights of the agreement
Following the initial subscription of £0.5 million a further subscription agreement for up to £4.3 million has been finalised with Suay Chin. The first instalment of the additional subscription of £3.3 million has been received by the company with the balance expected to be received shortly.
Kodal Minerals is now well funded and supported to expand the exploration and development programme at Bougouni. Kodal Minerals and Suay Chin have also entered into the off-take term sheet to provide the basis of an extended off-take agreement for between 80% and 100% of the spodumene product produced at the project for a period of three years.
In addition, Kodal Minerals will collect a bulk sample for shipment to allow assessment of the mineralisation characteristics to assist in determining future treatment plant requirements and Suay Chin has director appointment rights for so long as it holds more than 12% of issued share capital of the company and is expected to appoint a director in the near future.
Suay Chin has also entered into a relationship agreement to govern its relationship with the company and a lock-in agreement where it is unable to dispose of any shares in the company for 12 months and must adhere to orderly market principles for 12 months thereafter
“We are very pleased to welcome Suay Chin as a major shareholder of Kodal Minerals and we share the enthusiasm of our partner for the Bougouni lithium project as well as the opportunity to work together to move rapidly towards development of the project,” comments Kodal Minerals CEO, Bernard Aylward.
“The investment by Suay Chin leaves us well funded and will enable us to focus our efforts on the exploration, metallurgical testing, resource estimation and future development of Bougouni.
“We are also delighted to be negotiating an extension to our off-take agreement with Suay Chin for up to 100%, increased from the 20% originally agreed, of the spodumene product produced at Bougouni. This off-take agreement is expected to be finalised following the completion of a scoping study. I look forward to providing further updates at this exciting time for Kodal Minerals,” concludes Aylward.
Feature image credit: Kodal Minerals
(Outcropping of pegmatite mineralisation on the surface at the Bougouni lithium project)