MGX Minerals Inc. said Aug. 2 that it entered a binding letter of intent to acquire all of Power Metals Corp.'s U.S. petrolithium brine assets, as well as a 20% working interest in the latter's current hard rock assets and any future assets acquired for the next three years.
MGX will also have the right to buy a further 15% working interest in Power Metals' hard rock assets for three years for C$10 million and receive a call option to buy up to 10 million Power Metals shares for three years.
Under the terms, MGX will issue 3 million shares to Power Metals, which will be restricted and released in tranches of 1 million shares every five months from the signing of a definitive agreement.
Power Metals' U.S. petrolithium brine assets include the Paradox basin venture it struck with American Potash Corp. to explore and develop lithium brines on 13,520 acres in Utah's Paradox basin.
Completion of the transaction is subject to a number of conditions, including satisfactory due diligence and the negotiation and execution of a definitive agreement.