Nevada Clean Magnesium (TSXV:NVM) formally completed its joint venture agreement with ScanMag AS of Norway previously announced on December 22, 2014. Under the Terms of Agreement, shares will be issued proportionally to receipt of monies starting with the initial payment of $2 million USD; $5 million USD investment from ScanMag AS into Nevada Clean Magnesium over 4 years, beginning with the first major payment of $2,000,000 within 12 months, followed by 36 monthly payments of $83.3 thousand USD.
As quoted in the press release:
- $5 million USD investment from ScanMag AS into Nevada Clean Magnesium (“NCM”), payable over 4 years, commencing with the first major payment of $2,000,000 within 12 months, followed by 36 monthly payments of $83.3 thousand USD;
- During NCM receiving monthhly payments towards the $5 million USD investment, ScanMag AS will receive proportionally, a total of up to 12% of the issued common equity shares of NCM calculated as at the date of the signed JV agreement;
- Shares will be issued proportionally to receipt of monies starting with the initial payment of $2 million USD:
- ScanMag will be entitled to one board seat on the board of directors of NCM for so long as it maintains ownership of at least 12% of the issued and outstanding common shares of NCM;
- NCM will receive a 10% pre-financing equity stake in ScanMag dilutable down to 2% undiluted interest;
- ScanMag will receive access to the NCM technical and intellectual assets needed to support and develop a process for its production in Glomfjord, Norway;
- NCM and ScanMag will establish a separate technical development company for the testing of aspects of the magensium processing proof of concept through a jointly owned Norwegian subsidiary based in Glomfjord, Norway. ScanMag AS is to fund an initial contribution for the technical development company, after which each party pays its proportional share. NCM will contibute its 50% share of budgeted phase work after it has received the initial $2 million USD payment from ScanMag;
- Both NCM and ScanMag AS will be entitled to 50/50 of the data,findings and intellectual property developed through the joint venture.
- Alpha Omega, a private company owned and controlled by James Sever, P. Eng., is a party to the Joint Venture Agreement and an integral part of the planned technical development.
Nevada Clean Magnesium CEO, Ed Lee, said:
It’s been long in the making and we are very pleased to have achieved this joint venture with a similar company to ours. The companies are looking to bulid magnesium metal producing operations so this agreement is a monumental milestone for both companies. The technical development done initially for ScanMag should lead the way to lowering the process risk for our Tami – Mosi project in Nevada.