Lithium Australia Limited (ASX: LIT) has completed an acquisition and joint venture agreement with Eastern Resources Ltd for the sale of a 70% interest in the Lepidolite Hill Lithium Project.
The company has received A$150,000 (Tranche 1: A$50,000 and Tranche 2: A$100,000) in cash with the final tranche of A$400,000 payable within 10 business days of the date that Mining Lease M15/1874 is granted and transferred to Eastern Resources.
Eastern Resources may, up until a notification that a definitive feasibility study (DFS) has been completed, elect to acquire Lithium Australia’s 30% participating interest by paying A$1,000,000 in cash or Eastern Resources shares (determined on a 20-day VWAP).
A joint venture will be formed to develop the Lepidolite Hill Lithium Project, where Eastern Resources will be the initial manager.
The company’s 30% interest will be free carried until a definitive feasibility study has been completed.
Lithium Australia and Eastern Resources will collaborate towards an offtake agreement of up to 30% of the lithium product extracted from the Lepidolite Hill Lithium Project.