MONTREAL, CANADA, October 23, 2017 – Sama Resources Inc. (“Sama” or the “Company”) (TSX-V: SME), is pleased to announce that it has entered into a binding term sheet in view of forming a strategic partnership (the “Term Sheet”) with HPX TechCo Inc. (“HPX”), a private mineral exploration company in which mining entrepreneur Robert Friedland is a significant stakeholder, in order to develop its Côte d’Ivoire Nickel-Copper and Cobalt project in Côte d’Ivoire, West-Africa.
As part of the Term Sheet, HPX would make a strategic investment in Sama of up to C$12,250,000. HPX would also have the ability to earn-into a joint venture with Sama to acquire a total of up to a 60% interest in Sama’s interest in the Côte d’Ivoire project, including the Samapleu Project, by funding exploration expenses and completing the feasibility study through total investments of C$30,000,000.
Under the terms of the Term Sheet, HPX would purchase 25,000,000 Units (“Units”) of Sama at a price of C$0.21 per Unit, resulting in total proceeds to Sama of C$5,250,000 (the “Private Placement”). The Units include 25,000,000 fully vested two-year (2-year) common share purchase warrants (“Warrants”) with an exercise price of C$0.28 per share. Fully exercised, the Private Placement and Warrants proceeds will total an investment of C$12,250,000 in Sama.
Following completion of the Private Placement, HPX would own approximately 11.4% of Sama’s issued and outstanding common shares and 20.5% assuming the Warrants are fully exercised, both on a fully diluted basis. On a non-diluted basis HPX would own approximately 15.4% of Sama’s issued and outstanding shares and 26.7% assuming only the exercise of its Warrants.
“We are very excited about the opportunity this partnership provides Sama in the form of a strong strategic shareholder,” commented Benoit La Salle, Executive Chairman of Sama. “We are pleased to be partnering with HPX, who bring to the table an experienced exploration team and a proven track record of developing a number of world-class mineral deposits.”
“We look forward to working with the HPX team and leveraging their cutting-edge exploration technology and significant experience,” added Marc-Antoine Audet, Sama’s President and CEO.
In addition to the Private Placement and Warrants, the Term Sheet also provides for HPX and Sama to enter into a separate joint venture agreement (the “JV Agreement”), whereby HPX can earn up to a 60% interest in Sama’s interest in the Côte d’Ivoire project, including the Samapleu Project. The precise form of the joint venture (the “JV Company”) is subject to completion of discussions between the parties. The JV Company will be responsible for funding the development of the permits, through the proceeds from the Private Placement, the exercise of the Warrants, additional private placements as well as direct investments by HPX in the JV Company, for a total cumulative investment of up to C$30,000,000.
Additional highlights of the Term Sheet include the following:
- HPX will have a pre-emptive / anti-dilution right to maintain its ownership percentage in Sama in future equity financings as long as the holdings of common shares of Sama by HPX and its affiliates remains above 10%;
- HPX will have the right, but not the obligation, to nominate and have appointed (i) two (2) directors to the board of Sama as long as its shareholding in Sama remains above 10%, and (ii) four (4) directors, if its shareholding is greater than 50%; and
Sama has also granted HPX an exclusivity period of 90 days to settle and execute definitive agreements. A break fee of US$1,000,000 is payable in the event of a breach of the exclusivity provisions.
The transactions contemplated by the Term Sheet remain subject to completion of due diligence by HPX, which is at a significantly advanced stage, and the settling and execution by HPX and Sama of definitive agreements (including a subscription agreement, an investment agreement, a joint venture and an earn-in agreement), as well as subject to approval of the applicable regulatory authorities, including the TSX Venture Exchange, final board approvals of both parties and Sama shareholder approval. The directors and officers of Sama, who collectively hold 7.26% of the outstanding common shares have agreed to support the transaction with HPX and to vote in favor of the transactions at the Sama shareholder meeting.
Samapleu Project Overview
The Nickel-copper-cobalt mineralization was discovered by Sama when it discovered the Yacouba layered complex of mafic and ultramafic rock. This layered complex was created approximately 2.1 billion years ago by the intrusion of magma through the Man Shield. The Yacouba complex can be traced over a strike length of more than 30 kilometers within Sama’s properties in Côte d’Ivoire.
Sama’s Côte d’Ivoire project is located approximately 600 kilometers northwest of Abidjan and is adjacent to the world-class nickel-cobalt laterite deposits of Sipilou and Foungouesso, forming a 125-kilometer-long new base metal camp in West Africa.
The technical information in this release has been reviewed and approved by Dr. Marc-Antoine Audet, P.Geo, President & CEO, Sama and qualified person as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects.
About Sama Resources
Sama Resources is a Canadian-based base mineral exploration and development company with projects in West Africa. For more information about Sama Resources, please visit the website at http://www.samaresources.com
SAMA RESOURCES INC./RESSOURCES SAMA INC.
Dr. Marc-Antoine Audet, President and CEO
Tel: (514) 726-4158
Mr. Matt Johnston, Corporate Development Advisor
Tel: (604) 443-3835
Toll Free: 1 (877) 792-6688, Ext. 5
HPX is a privately-owned, metals-focused exploration company deploying proprietary in-house geophysical technologies to rapidly evaluate buried geophysical targets. The HPX technology cluster comprises geological and geophysical systems for targeting, modelling, survey optimization, acquisition, processing and interpretation. HPX has a highly experienced board and management team led by Co-Chair and Chief Executive Officer Robert Friedland, President Eric Finlayson, a former head of exploration at Rio Tinto, and co-chaired by Ian Cockerill, a former Chief Executive Officer of Gold Fields Ltd. For further information, please visit www.hpxploration.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.