Lithium Australia Enters Binding Agreement For The Sale Of The Greenbushes South Lithium Project

Lithium Australia NL (ASX: LIT) (Lithium Australia or the Company) is pleased to advise it has entered into a binding agreement with Galan Lithium Ltd (ASX: GLN) (‘Galan’) for the sale of the Company’s remaining 20% interest in the Greenbushes South Lithium Project (‘Agreement’).

HIGHLIGHTS

• Lithium Australia and Galan have entered into a binding agreement, with Galan to acquire Lithium Australia’s remaining 20% interest in the Greenbushes South Lithium Project.
• Galan to issue Lithium Australia $1,000,000 worth of fully paid ordinary shares in the capital of Galan and a cash payment of $2,000,000 as consideration for the sale of the Greenbushes South Lithium Project.
  
• Galan grants a first right of refusal for offtake of up to 20% of Galan’s share of lithium produced by the Greenbushes South Lithium Project to Lithium Australia for future commercial production of lithium ferro phosphate.
• Joint venture partnership between Lithium Australia and Galan to terminate on completion of the sale of Greenbushes South Lithium Project.

Under the Agreement, the Company has agreed to sell, and Galan has agreed to acquire:

(a)the Company’s remaining 20% interest in the Greenbushes South Lithium Project tenements (including the tenements currently subject to application); and
(b)the Company’s remaining 20% participating interest under the Original Acquisition and JV Agreement (refer below for details).

The Company will receive the following from Galan in consideration for the sale of the remaining 20% interest in the Greenbushes South Lithium Project:

(a)fully paid ordinary shares in the capital of Galan to the value of $1,000,000 (‘Consideration Shares’); and
(b)a cash payment in the amount of $2,000,000 (‘Cash Consideration’).

The number of Consideration Shares to be issued to the Company will be calculated based on the volume weighted average price of Galan shares traded on the ASX for the 5 trading days preceding the date of completion of the sale of the Greenbushes South Lithium Project.

Click here for the full ASX Release

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