"Asset Sale Agreement and Convertible Note Facility Silver Lake and Phillips River have entered into the Asset Sale Agreement. Under the terms of the Asset Sale Agreement Silver Lake has agreed to purchase Phillips River’s Munglinup Project for $325,000. This project is made up of five exploration tenements E74/485; E74/472; E74/471;E74/473 and E74/474
Under the Convertible Note Facility (“Facility”), all amounts outstanding under the Facility become due and payable, at Silver Lake’s sole election, within 14 days of termination of the MIA. Silver Lake and Phillips River have agreed to offset the amount owing under the Facility against the consideration payable under the Asset Sale Agreement. Consequently, whilst the consideration payable by Silver Lake for the Munglinup Project is $325,000 no further monies will pass to Phillips River.
Settlement under the Asset Sale Agreement will occur later in the year and is subject to satisfaction of a number of conditions. Silver Lake will immediately take responsibility for the maintenance and ongoing costs of, the tenements making up the Munglinup Project."
Highlighting this sentence.......
"Settlement under the Asset Sale Agreement will occur later in the year and is subject to satisfaction of a number of conditions"
Although this is under an asset sale agreement (like Kundip & Trilogy) obviously PRH & SLR management believe it is separate and distinct.
The announcement lacks any details about the conditions. Naturally one is govt approval but what are the others. And when is settlement?
I still ask the question how can this asset sale not be aggregated with the rest of the Phillips River Assets which require Shareholder approval to sell. Otherwise you could sell of all the exploration assets in bits and pieces and never need to get shareholder approval. All tenements whether exploration or mining leases in this specific region should be considered as one aggregated company asset. I see no reason why it should be treated differently.
If there was a timing issue related to funds needing to be spent for lease obligations then the original convertible notes issue SPECIFICALLY included funds for PHR to adequately handle this. It is a bit presumptious for SLR now to be doing their own thing at Munglinup prior to the whole PRH deal going through!
Things are looking fairly sad regarding the SLR share price. To be fair I think they had better up the offer. For PRH directors not to include some "protection" in the deal to allow for a fall in the SLR share price shows what pathetic negotiators they are....but we know that already after the LN offtake deal.
At the moment the PRH share price is being governed totally by the SLR arbitrage factor. Market Cap today of under $12m - that says it all.
First Quantum - waiting to hear from you still! Not interested???? The people of Ravensthorpe would love you to put your weight behind another project in the area. Small change compared with what you have spent on the old BHP Nickel project.
PRH Price at posting:
1.4¢ Sentiment: Hold Disclosure: Held
