TORONTO, Oct. 22,
2024 /PRNewswire/ - IsoEnergy Ltd. (TSX: ISO) (OTCQX:
ISENF) ("IsoEnergy") and Purepoint Uranium Group Inc. (TSXV:
PTU) (OTCQB: PTUUF) ("Purepoint") are pleased to announce
that they have entered into a contribution agreement in connection
with the creation of a joint venture (the "Joint Venture")
for the exploration and development of a portfolio of uranium
properties in northern Saskatchewan's Athabasca Basin. Both companies will
contribute assets from their respective portfolios to the Joint
Venture, which will consist of 10 projects covering more than
98,000 hectares in the east side of the Athabasca Basin and will leverage their
respective expertise to capitalize on the significant potential of
these properties.
Transaction Highlights
- Joint Venture Portfolio – The
Joint Venture will be comprised of 10 projects within the eastern
Athabasca Basin (Figure 1)
including:
-
- IsoEnergy's Geiger, Thorburn
Lake, Full Moon, Edge, Collins Bay Extension, North Thorburn, 2Z Lake, and Madison
Projects.
- Purepoint's Turnor Lake and
Red Willow Projects.
- Complementary and Prospective Ground Covering the Larocque
Trend with Strong Discovery Potential – The
Larocque Trend ("Larocque Trend"), is an important regional
structure that hosts the world-class Hurricane deposit and other
notable high-grade occurrences, including those on Cameco/Orano's
Dawn Lake joint venture. The trend
extends onto the Turnor Lake and
Full Moon Projects, positioning the Joint Venture along a proven
corridor for uranium mineralization, where further discoveries
could be expedited (Figure 2).
- Strategic Synergy and Strengthened Positioning through
Equity Participation – IsoEnergy will subscribe
for $1.0 million in concurrent equity
financing of Purepoint. Through this equity stake, IsoEnergy
will gain exposure to Purepoint's other highly prospective
exploration projects in the Athabasca Basin, including Hook Lake, which
previously intersected an impressive 10 meters at 10.3% U₃O₈. In
turn, Purepoint will benefit from IsoEnergy's financial and
technical support, enabling both companies to work collaboratively
to accelerate project development and drive long-term success.
- Initial Ownership Structure and Operating Terms
– IsoEnergy will initially hold a 60% interest in the
Joint Venture, while Purepoint will hold a 40% interest. Each party
has the option to adjust this ownership to 50/50 within six months
through the exercise of mutually exclusive put/call
options. Purepoint will serve as the operator during the
exploration phase of the Joint Venture properties. Upon the
advancement into the pre-development phase, IsoEnergy will assume
operational control of the Joint Venture properties.
Philip Williams, CEO and Director
of IsoEnergy, commented: "We are excited to announce formation of
this Joint Venture with Purepoint and see many advantages for both
companies. Together, the Joint Venture projects consolidate a large
land position immediately to the east of the Larocque East project,
which includes several kilometres of the highly prospective
Larocque trend. Purepoint has proven itself an exceedingly capable
operator and the Joint Venture will allow us to have several of
our highly prospective projects advanced, while remaining
focused on dual priorities of exploring and advancing the Larocque
East project, host to the high-grade Hurricane Deposit, and
restarting our past producing uranium mines in Utah. By combining our complementary project
portfolios and leveraging our collective expertise, we believe we
are well-positioned to accelerate discoveries and create value for
our shareholders."
Chris Frostad, President and CEO
of Purepoint, added: "With this Joint Venture, the majority of
Purepoint's most significant projects are now being advanced within
partnerships alongside some of the uranium sector's strongest
players. This collaboration underscores the confidence our
partners, including Cameco, Orano, Foran Mining and now IsoEnergy,
have in the potential of these projects, and it further solidifies
Purepoint's position at the forefront of uranium exploration in the
Athabasca Basin. By combining
forces and pooling resources, we are accelerating exploration
efforts and setting the stage for potential large-scale discoveries
that can meet the growing demand for clean energy. We look forward
to leveraging the technical and financial strengths of our partners
as we continue to operate these district-scale projects and drive
them towards success."
Figure 1: Joint Venture Portfolio, including 10 Projects
Covering More Than 98,000 Hectares in the Athabasca Basin.
Figure 2: Complementary and Prospective Ground Covering
the Larocque Trend with Strong Discovery Potential
Joint Venture Terms
The Joint Venture will be governed by a formal joint venture
agreement to be entered into between the companies concurrently
with the effective formation of the Joint Venture. Under the
agreement:
- IsoEnergy will contribute its Geiger, Thorburn Lake, Full Moon, Edge, Collins Bay,
North Thorburn, 2Z Lake, and
Madison Projects in exchange for an initial 60% participation
interest in the Joint Venture.
- Purepoint will contribute its Turnor
Lake and Red Willow Projects in exchange for an initial 40%
participation interest in the Joint Venture.
- IsoEnergy will have a put option to sell, and Purepoint will
have a call option to acquire, 10% of IsoEnergy's initial
participation interest, increasing Purepoint's stake to 50% in
exchange for 4,000,000 post-Consolidation Purepoint shares (as
defined below). This option is exercisable within six months of the
Joint Venture's formation, with the exercise of one option
resulting in the expiry of the other. If exercised, both parties
will hold equal 50/50 participation interests in the Joint
Venture.
- After the put/call option period, IsoEnergy will hold a further
option to purchase an additional 1% interest from Purepoint for
$2 million, giving IsoEnergy a 51%
participation interest and Purepoint a 49% participation interest.
This option expires on the earlier of February 28, 2026, or 60 days after a material
uranium discovery.
- The ownership interests of each company are subject to standard
dilution if a party fails to contribute to approved Joint Venture
programs or expenditures. If either party's interest is reduced to
10% or less, that party will relinquish its entire interest in the
Joint Venture in exchange for a 2% net smelter royalty (NSR) on the
Joint Venture properties. The remaining party can purchase 1% of
the NSR for $2 million.
- If one of the parties seeks to sell its participation interest
in the Joint Venture, such party may force the other party to sell
its participation interest in the Joint Venture so long as the
selling party's participation interest is equal to 60% or
greater.
- Purepoint will act as operator for all Joint Venture properties
in the exploration phase, leveraging its extensive expertise and
deep understanding of the Athabasca Basin. Once the Joint Venture
properties advance to the pre-development stage, IsoEnergy will
assume the role of operator.
Purepoint Share Consolidation and Concurrent
Financing
In connection with the transaction, Purepoint will
consolidate its shares on a 10:1 basis (the
"Consolidation"). Purepoint currently has 500,772,765
common shares issued and outstanding. After giving effect to the
Consolidation, Purepoint will have approximately 50,077,277 issued
and outstanding post-consolidation common shares. The Consolidation
has been approved by the Purepoint Board of Directors and was
approved by Purepoint's shareholders at its Annual General and
Special Meeting held on June 4, 2024.
The Consolidation remains subject to approval by the TSX Venture
Exchange (the "TSXV").
In conjunction with the Consolidation, Purepoint plans to
complete a non-brokered private placement offering of up to
6,666,667 units at a price of $0.30
per unit, for gross proceeds of up to $2,000,000 (the "Concurrent Financing").
Each unit will consist of one post-Consolidation share and one
warrant exercisable at $0.40 to
acquire one post-Consolidation share for a period of three years.
IsoEnergy will subscribe for $1.0
million of this financing, underscoring its commitment to
the Joint Venture's exploration plans. IsoEnergy will be granted
the right, for so long as it owns at least 10% of the
post-Consolidation shares of Purepoint (on a partially diluted
basis), to participate in any future equity financing of Purepoint
in order to maintain its pro rata interest in Purepoint. The net
proceeds of the Concurrent Financing will be used by Purepoint for
general working capital purposes
The transactions, including the formation of the Joint Venture,
the Consolidation, and Concurrent Financing (together the
"Transactions"), remains subject to approval by the TSXV.
The Joint Venture will take effect following the satisfaction of
certain conditions, including but not limited to the completion of
the Consolidation, closing of the Concurrent Financing, and receipt
of all necessary regulatory approvals, including approval of the
TSXV.
About IsoEnergy Ltd.
IsoEnergy is a leading, globally diversified uranium company
with substantial current and historical mineral resources in top
uranium mining jurisdictions of Canada, the U.S. and Australia at varying stages of development,
providing near-, medium- and long-term leverage to rising uranium
prices. IsoEnergy is currently advancing its Larocque East project
in Canada's Athabasca basin, which is home to the
Hurricane deposit, boasting the world's highest-grade indicated
uranium mineral resource.
IsoEnergy also holds a portfolio of permitted past-producing,
conventional uranium and vanadium mines in Utah with a toll milling arrangement in place
with Energy Fuels. These mines are currently on standby, ready for
rapid restart as market conditions permit, positioning IsoEnergy as
a near-term uranium producer.
About Purepoint Uranium Group Inc.
Purepoint Uranium Group Inc. (TSXV: PTU) (OTCQB: PTUUF) is a
focused explorer with a dynamic portfolio of advanced projects
within the renowned Athabasca
Basin in Canada. The most
prospective projects are actively operated on behalf of
partnerships with industry leaders including Cameco Corporation,
Orano Canada Inc. and IsoEnergy Ltd.
Additionally, the Company holds a promising VHMS project
currently optioned to and strategically positioned adjacent to and
on trend with Foran Corporation's McIlvena Bay project. Through a
robust and proactive exploration strategy, Purepoint is solidifying
its position as a leading explorer in one of the globe's most
significant uranium districts.
Neither the Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the Exchange) accepts
responsibility for the adequacy or accuracy of this Press
release.
Disclosure regarding forward-looking statements
This press release contains "forward-looking information"
within the meaning of applicable Canadian securities legislation.
Generally, forward-looking information can be identified by the use
of forward-looking terminology such as "plans", "expects" or "does
not expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or state that
certain actions, events or results "may", "could", "would", "might"
or "will be taken", "occur" or "be achieved". This forward-looking
information may relate to the Transactions, including statements
with respect to the completion of the Transactions; the anticipated
benefits of the Joint Venture to the parties and their respective
shareholders; the expected receipt of regulatory and other
approvals relating to the Transactions; the expected ownership
interests of and Purepoint in the Joint Venture; the prospects of
each company's respective projects, including mineralization of
each project; the potential for, success of and anticipated timing
of commencement of future exploration and development of the Joint
Venture projects; the expected gross proceeds of the Concurrent
Financing and the anticipated use thereof; and any other
activities, events or developments that the companies expect or
anticipate will or may occur in the future.
Forward-looking statements are necessarily based upon a
number of assumptions that, while considered reasonable by
management at the time, are inherently subject to business, market
and economic risks, uncertainties and contingencies that may cause
actual results, performance or achievements to be materially
different from those expressed or implied by forward-looking
statements. Such assumptions include, but are not limited to,
assumptions that IsoEnergy and Purepoint will complete the
Transactions in accordance with the terms and conditions of the
relevant agreements; that the parties will receive the required
regulatory approvals and will satisfy, in a timely manner, the
other conditions to completion of the Transactions; the accuracy of
management's assessment of the effects of the successful completion
of the Joint Venture and that the anticipated benefits of the Joint
Venture will be realized; the anticipated mineralization of
IsoEnergy's and Purepoint's projects being consistent with
expectations and the potential benefits from such projects and any
upside from such projects; the price of uranium; that
general business and economic conditions will not change in a
materially adverse manner; that financing will be available if and
when needed and on reasonable terms; and that third party
contractors, equipment and supplies and governmental and other
approvals required to conduct the Joint Venture's planned
activities will be available on reasonable terms and in a timely
manner. Although each of IsoEnergy and Purepoint have attempted to
identify important factors that could cause actual results to
differ materially from those contained in forward-looking
information, there may be other factors that cause results not to
be as anticipated, estimated or intended. There can be no assurance
that such information will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking information.
Such statements represent the current views of IsoEnergy and
Purepoint with respect to future events and are necessarily based
upon a number of assumptions and estimates that, while considered
reasonable by IsoEnergy and Purepoint, are inherently subject to
significant business, economic, competitive, political and social
risks, contingencies and uncertainties. Risks and uncertainties
include, but are not limited to the following: the inability of
IsoEnergy and Purepoint to complete the Transactions; a material
adverse change in the timing of and the terms and conditions upon
which the Transactions are completed; the inability to satisfy or
waive all conditions to completion of the Transactions; the failure
to obtain regulatory approvals in connection with the Transactions;
the inability of the Joint Venture to realize the benefits
anticipated from the Joint Venture and the timing to realize such
benefits; changes to IsoEnergy's and/or Purepoint's current and
future business plans and the strategic alternatives available
thereto; growth prospects and outlook of Purepoint's business;
regulatory determinations and delays; stock market conditions
generally; demand, supply and pricing for uranium; and general
economic and political conditions in Canada, the United
States and other jurisdictions where the applicable party
conducts business. Other factors which could materially affect such
forward-looking information are described in the risk factors in
each of IsoEnergy's and Purepoint's most recent annual management's
discussion and analyses or annual information forms and IsoEnergy's
and Purepoint's other filings with the Canadian securities
regulators which are available, respectively, on
each company's profile on SEDAR+ at www.sedarplus.ca. IsoEnergy and
Purepoint do not undertake to update any forward-looking
information, except in accordance with applicable securities
laws.
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SOURCE IsoEnergy Ltd.