CELSIUS ENTERS INTO INITIAL BINDING DEED AND AGREEMENT WITH LOCAL COMPANIES TO PROGRESS MCB PROJECT
HIGHLIGHTS
- Binding deed entered into with Sodor, Inc. to attain the required 60% Filipino legal ownership in Celsius’ wholly-owned subsidiary, MMCI.
- Filipino legal ownership over 60% of MMCI’s outstanding shares is among the pre-requisites toward MMCI’s signing of a Mineral Production Sharing Agreement (MPSA) with the Philippine Government to build and operate the Company’s flagship Maalinao-Caigutan-Biyog Copper-Gold Project (“MCB” or “MCB Project”).
- Accompanying binding letter agreement entered into with Sodor Inc. and PMR Holding Corp. to agree on timeline for, and that delivery of share certificates representing 60% of MMCI’s outstanding shares shall be made to Sodor Inc. only after the funding by Sodor Inc. and PMR Holding Corp. of approximately ~US$43 million for a 30% economic interest in the MCB Project.
- The MCB Project is composed of MMCI and PDEP, Inc., both wholly owned subsidiaries of Celsius. MMCI will hold only the assets that require 60% Filipino ownership while PDEP will hold the remainder.
Celsius Resources Limited (“Celsius” or “the Company”) is pleased to announce that on 17 March 2023 the Company’s wholly owned subsidiary, Makilala Holding Limited (“MHL”), entered into a binding deed (“Deed”) with Sodor, Inc. (“Sodor”) for Sodor to acquire a 60% legal ownership in Makilala Mining Company, Inc. (“MMCI”) for consideration of PHP 300 million (approximately A$8.2 million as at the date of this announcement) (“MMCI Consideration”), on terms and conditions described in the following paragraphs.
The signing of the Deed is a significant milestone as it will enable MMCI to apply for an MPSA for the MCB Project with the Philippine Government. As previously advised by the Company, under Philippine law, an MPSA must be held by a company that is at least 60% Filipino owned.2
In addition, the Company and its wholly owned subsidiaries MHL, MMCI, and PDEP Inc. (“PDEP”) entered into an accompanying binding letter agreement with Sodor and its affiliate PMR Holding Corp. (“PMR”) (together, the “Parties”) to agree on the timeline for, and that delivery to Sodor Inc. of share certificates representing 60% of MMCI’s outstanding shares pursuant to the Deed shall be made only after, the funding by Sodor Inc. and PMR of approximately ~US$43 million for a 30% economic interest in the MCB Project (“Funding Commitment”).3 The MCB Project will be composed of MMCI and PDEP, both wholly owned subsidiaries of Celsius. The Parties shall rescind the Deed if Sodor and PMR are not able to provide the Funding Commitment within two years from signing, unless the period is shortened or extended by mutual agreement of the Parties.
As at the date of this announcement the amount of the Funding Commitment, which is inclusive of the MMCI Consideration, is approximate as the Parties will confirm the size and timing of payment of the Funding Commitment following completion of a bankable feasibility study on the MCB Project. Provision of the Funding Commitment also remains subject to completion of negotiation and execution of binding definitive long form legal documentation.
The Philippine Government has otherwise advised MMCI that it has met all of the other technical requirements to obtain the MCB Project’s required environmental and mining permits.
Celsius Non-Executive Chairman and MMCI Chairman and President, Atty Julito R. Sarmiento, commented:
“We are indeed honored to have Sodor Inc. as our local partner in our vision to develop the MCB Project as a model for Transformative Mining in the Philippines. Our principles and visions are aligned, which is a powerful step towards developing and operating the MCB Project in a responsible and sustainable manner benefitting both our shareholders and local stakeholders.
It has always been our commitment, particularly to the Balatoc Tribal Community, that central to the mine development is cultural respect, social development, and environmental protection. Sodor Inc. shares the same commitment, and is thus a perfect partner in developing the MCB Project.”
To read the full announcement, click here.