InZinc Closes Option Agreement and Receives Initial Payment of US$500,000
Vancouver, British Columbia--(Newsfile Corp. - June 2, 2021) - InZinc Mining Ltd. (TSXV: IZN) ("InZinc" or the "Company") is pleased to announce the closing of the option agreement (the "Option Agreement") with American West Metals Limited ("American West"), a private Australian company, on June 1, 2021 (the "Effective Date"). The Option Agreement was approved by the Company's shareholders at the annual meeting of shareholders held on May 27, 2021 and subsequently approved by the TSX Venture Exchange. American West, having made an initial cash payment of US$500,000 to InZinc, now has an option to earn a 100% interest in InZinc's West Desert project ("West Desert") located in Utah, USA.
"By leveraging, through prospective shareholdings in a new and aggressive ASX listed North American copper-zinc metal explorer and receiving a significant stream of cash payments, InZinc will benefit from the ability to self-fund the next exploration activities at our Indy project in British Columbia and generate new growth opportunities for InZinc shareholders," commented Wayne Hubert, CEO of InZinc. "We are looking forward to renewed activities at Indy as well as the Initial Public Offering of American West on the ASX, a successful prefeasibility campaign at West Desert, and programs at American West's Storm Copper and Copper Warrior Projects over the next 24 months."
Highlights of the Option Agreement include:
An initial cash payment of US$500,000 to InZinc (received)
Payments to InZinc over 24 months comprising:
CDN$1,000,000 within 30 days of American West listing its shares on the Australian Securities Exchange ("ASX") through an initial public offering or other going public transaction ("IPO") or 12 months after the Effective Date, whichever is earlier;
US$1,500,000 upon announcement by American West of a completed Prefeasibility Study for West Desert or 24 months after the Effective Date, whichever is earlier; and
CDN$2,500,000 by way of shares of American West. If American West has not completed the IPO on the ASX within 12 months of the Effective Date, InZinc may elect to receive CDN$1,250,000 in cash from American West in lieu of shares. If American West has not completed the IPO on the ASX within 24 months of the Effective Date, InZinc may elect to receive CDN$2,500,000 in cash in lieu of shares.
- Exercise of Option, Operator, Indium Revenue Share and Termination
Upon exercise of the Option, InZinc will receive 50% of the revenue from the sale of indium mined from West Desert determined on a Net Smelter Return basis ("NSR"). American West will have the right to reduce the NSR to 25% by paying InZinc US$5,000,000 in cash at any time prior to the first sale of indium from the project.
During the Option period, American West will be the operator of West Desert. If payments referred to above are not paid when due and American West does not rectify the failure within 45 days, InZinc would have the right to terminate the Option Agreement and American West shall surrender West Desert promptly to InZinc.
About American West
American West is a new Australian company with a strategy to achieve growth in shareholder wealth through the discovery and development of major mineral deposits. The Company is aiming to list its securities on the Australian Securities Exchange (ASX) in H2 2021. American West has acquired an interest in three base metals projects in North America which it believes have potential to generate significant economic resource inventories and robust mining proposals:
- The West Desert Project in Utah, USA;
- The Storm Copper and Seal Zinc Projects in Nunavut, Canada; and
- The Copper Warrior Project in Utah, USA.
For further information on American West, see www.americanwestmetals.com
About InZinc
InZinc is focused on growth through exploration and advancement of its interest in multiple North American base metals projects. The road accessible Indy project (100% option), located in central British Columbia, comprises discoveries of near surface mineralization and large untested exploration targets along a 25km long trend with potential for the discovery of a new regional scale zinc belt. The West Desert Option (100% option to American West Metals) provides significant cash payments and continuing leverage through prospective ownership of shares of American West Metals as it funds the advancement of the West Desert project to prefeasibility (planned in Q3 2023) and the Storm Copper and Copper Warrior projects in North America. In addition, upon exercise of the West Desert option, InZinc will receive 50% of the revenue from the sale of indium mined from West Desert.
InZinc Mining Ltd.
"Wayne Hubert"
CEO and Director
Phone: 604.687.7211
Website: www.inzincmining.com
For further information contact:
Joyce Musial
Vice President, Corporate Affairs
Phone: 604.317.2728
Email: joyce@inzincmining.com
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: "believe", "expect", "anticipate", "intend", "estimate", "plan", "design", "postulate" and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results, performance, or actions and that actual results and actions may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, those risks and uncertainties disclosed in the Company's Management Discussion and Analysis for the year ended December 31, 2020 and for the three months ended March 31, 2021 filed with certain securities commissions in Canada and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company's Canadian public disclosure filings may be accessed via www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/86121