ATHA Energy Corp. (CSE: SASK) (FRA: X5U) (OTCQB: SASKF) (“ATHA”) is pleased to announce, in furtherance to its news release from August 20th, 2024 , the Company and Terra Uranium Ltd. (ASX: T92) (“T92”) have executed a definitive option agreement for T92 to earn an option to acquire a 70% interest in ATHA’s Spire and Horizon properties (together, the “Spire Horizon Projects”) and a definitive option agreement for ATHA to earn an option to acquire up to a 60% interest in T92’s Pasfield Lake property (the “Pasfield Project”).
SPIRE HORIZON OPTION
In accordance with the terms of the Option Agreement ATHA shall grant T92 the sole and exclusive right and option to acquire up to a 70% interest in the Spire Horizon Projects (the “Spire Horizon Option”) in consideration for incurring a minimum of $4,750,000 exploration expenditures as set out below:
| (i) | on or before December 20, 2024, T92 must incur at least $750,000 of statutory exploration expenditure, which must also include the costs associated with the payment for a mineral exploration assessment report (the “First Expenditure”); |
| (ii) | on or before September 21, 2025, T92 must incur additional statutory exploration expenditures of at least $1,000,000 (the “Second Expenditure”); |
| (iii) | on or before September 21, 2026, T92 must incur additional statutory exploration expenditures of at least $1,000,000 (the “Third Expenditure”); |
| (iv) | on or before September 21, 2027, T92 must incur additional statutory exploration expenditures of at least $1,000,000 (the “Fourth Expenditure”); and |
| (v) | on or before September 21, 2028, T92 must incur additional statutory exploration expenditures of at least $1,000,000 (the “Fifth Expenditure”). |
ATHA and T92 agree to form a joint venture on the Spire Horizon Projects upon the satisfaction of the First Expenditure, Second Expenditure, and the Third Expenditure, with the initial interest of T92 being a 50% participating interest and ATHA’s being a 50% carried interest (subject to the 5% carried interest in favour of a third party).
Upon the satisfaction of the Fourth Expenditure and the Fifth Expenditure, T92’s interest will increase to a 70% participation interest and ATHA’s interest will adjust to a 30% participation interest. If at any time during the period where ATHA holds a carried interest, T92 prepares and delivers a “preliminary economic assessment” prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects in respect of the Spire Horizon Projects to ATHA, ATHA’s carried interest may be converted into a participating interest at the election of ATHA.
PASFIELD OPTION
In accordance with the terms of the Option Agreement, T92 shall grant to ATHA the four exclusive and separate rights and options to acquire undivided legal and beneficial interests in the Pasfield Project (together the “Pasfield Options” and each, a “Pasfield Option”) as follows:
| (i) | an undivided 15% interest in the Pasfield Project, which may be exercised by either: (a) funding exploration expenditures totalling $1,000,000 or (b) successfully completing one deep hole of at least 1,000 m into the geophysical target on or before December 31, 2025; |
| (ii) | an undivided 15% interest for a total of 30% interest in the Pasfield Project, which may be exercised by either: (a) funding exploration expenditures totalling $2,000,000 or (b) successfully completing two deep holes of at least 1,000 m into the geophysical target on or before December 31, 2026; |
| (iii) | an undivided 15% interest in the Pasfield Project, which may be exercised by either: (a) funding exploration expenditures totalling $3,000,000 or (b) successfully completing three deep holes of at least 1,000 m into the geophysical target on or before December 31, 2027; and |
| (iv) | an undivided 15% interest in the Pasfield Project (the “Fourth CP Option”), which may be exercised by either: (a) funding exploration expenditures totalling $4,000,000 or (b) successfully completing four deep holes of at least 1,000 m into the geophysical target on or before December 31, 2028. |
After exercising each Pasfield Option and upon written notice by ATHA to T92, each undivided 15% interest in the Pasfield Project can, at ATHA’s election, be converted into a 1% net smelter returns royalty (“NSR”) for an aggregate maximum NSR of 4%. Upon the satisfaction of the Fourth CP Option and assuming ATHA has not converted its interests in the Pasfield Project into a NSR, the parties will be deemed to form a joint venture on the Pasfield Project (the “Pasfield Joint Venture”) with T92 holding an initial 40% participating interest in the Pasfield Joint Venture and ATHA holding a 60% participation interest. ATHA will also have the sole and exclusive right to access and use all camp facilities located on the Pasfield Project for a daily fee to be negotiated between ATHA and T92.
Investor Relations Agreements
Further to the Company’s news releases dated April 11, 2024, June 3, 2024 and June 17, 2024, the Company also announces that the Company’s agreement with Hybrid Financial Inc. (“Hybrid”) will be automatically extended in accordance with its terms for a further three months following the conclusion of its initial six month term ending October 11, 2024, the Company and Gold Standard Media LLC (“GSM”) have, subject to the approval of the TSX Venture Exchange (the “TSXV”), extended the term of their agreement for an additional three months ending November 30, 2024 for no additional cost to the Company, and the Company and Creative Direct Marketing Group Inc. (“CDMG”) have mutually agreed to defer the commencement of their marketing campaign to a future date to be agreed between the parties due to market conditions (no additional consideration beyond an initial US$83,700 upfront fee has been paid to CDMG and there is no cost associated with such deferral). The Company will provide further updates upon the commencement of the marketing campaign by CDMG. Any amendment to the Company’s agreement with CDMG will be subject to TSXV approval.
Each of Hybrid, GSM and CDMG are arm’s length parties to the Company. GSM and each of its directors, officers or employees do not currently own any securities of the Company. To the knowledge of the Company, neither Hybrid, CDMG, nor any of their respective directors, officers or employees currently owns any securities of the Company.
