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PolarX secures favourable amendments to Caribou Dome acquisition terms

Published: 00:53 17 Nov 2020 GMT

PolarX Ltd - Polarx secures favourable amendments to Caribou Dome acquisition terms
The earn-in deadline has been extended to 6 June 2024

PolarX Ltd (ASX:PXX) has secured more favourable amendments to the terms of its option to acquire an 80% interest in the Caribou Dome copper deposit in Alaska USA and (a 90% interest in the adjacent Senator property (collectively the Caribou Dome Project).

The revised option terms with the underlying vendors of the Caribou Dome Project are:

  • Earn-in deadline extended to 6 June 2024;
  • One-off cash payment to the underlying vendors of US$75,000 upon execution of the option amendments;
  • Subsequent annual payments to the underlying vendors in the amounts of US$100,000 by 6 June 2021, US$100,000 by 6 June 2022, US$100,000 by 6 June 2023 and an Earn-In Deadline payment of US$1,260,000; and
  • Either meeting substantially reduced qualifying expenditure requirements or conducting a feasibility study to mine the Caribou Dome Project.

Qualifying expenditure

For any period during which the company does not complete U$400,000 of qualifying expenditure until it has conducted a feasibility study, it shall pay to the underlying vendors a penalty in the amount of 25% of the expenditure shortfall.

This payment will be in lieu of the expenditure shortfall and excess qualifying expenditure in any period may be carried forward to future periods.

Amendment consideration

Additionally, the consideration for the amendments also includes the issue to certain underlying vendors of:

  • $12,500 worth of fully paid ordinary shares in the company following execution of the option amendment; and
  • Further annual payment of $12,500 worth of shares on or before 1 June 2021 and on or before 1 June of each subsequent year as long as the option remains in effect.

For each share payment instalment, the number of shares to be issued will be based on the 10-day volume weighted average price of the company’s shares immediately prior to the date of each share issue.

The Caribou Dome Deposit

On 25 February 2015, PolarX secured the right to acquire an 80% interest in the Caribou Dome Project by meeting certain expenditure obligations and annual cash payments.

The Caribou Dome Deposit forms part of the company’s Alaska Range Project and contains an existing mineral resource estimate of 2.8 million tonnes at 3.1% copper with about 60% of the mineral resource occurring within 150 metres of surface - within which there is a high-grade component of 935,000 tonnes at 4.4% copper.

The company is confident there is considerable potential to discover additional high grade mineralisation and to continue to expand the resource base at the Project and intends to evaluate the economic viability of trucking copper mineralisation from Caribou Dome to potential processing plant sites at it’s wholly owned Zackly copper-gold deposit.

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