Usha Resources Ltd. (“USHA” or the “Company”) (TSXV:USHA)(OTCQB:USHAF)(FSE:JO0), a North American mineral acquisition and exploration company focused on the development of drill-ready battery and precious metal projects, is pleased to announce unanimous Board of Director approval and support for its previously announced spin-out transaction (the “Spinout”) and that the Company has now entered into an arrangement agreement (the “Arrangement”) with its wholly-owned subsidiary, Formation Metals Corporation (“Formation Metals” or “FMC”), to transfer the Nicobat Nickel-Copper-Cobalt property to FMC.
Under the terms of the Arrangement dated May 10, 2022, USHA shareholders will be issued one (1) share of FMC with respect to every five (5) shares of USHA owned on the share distribution record date (the “Share Distribution Record Date”), which will be predetermined by USHA’s Board of Directors and announced by a news release -in advance. Holders of USHA options and warrants, who exercise their options and/or warrants before the Share Distribution Record Date, will also be entitled to receive one (1) share of FMC with respect to every five (5) shares of USHA.
Upon completion of the Arrangement, USHA shareholders will ultimately own shares in two public companies:
- USHA, which will be focused on its US-based assets, including the Jackpot Lake lithium brine project.
- Formation Metals, which will be focused on nickel at the Nicobat project.
Deepak Varshney, CEO of Usha Resources stated: “Formation Metals was conceived with the idea of expanding our investor base while creating additional shareholder value. This move will provide our investors with an ownership stake in two separate companies, while allowing each entity to pursue separate growth paths and unlock additional opportunities specific to their market. Both USHA and FMC will be better positioned to execute on their respective strategic business plans and have the required flexibility to allocate resources and deploy capital as each see fit. At the end of the day, I want to capitalize on the exciting opportunities we have in motion while building sustainable value for our long-term, big picture shareholders in both USHA and Formation Metals.”
Completion of the Arrangement is subject to a number of conditions, including the following:
- the approval by the shareholders of USHA at a special general meeting (the “Meeting”);
- the approval of the Supreme Court of British Columbia; and
- the acceptance of the Arrangement by the TSX Venture Exchange.
The Arrangement cannot be completed until all the above conditions are met.
A copy of the Arrangement will be posted on www.sedar.com under the profile of the Company. Additional details regarding the Arrangement will be included in the information circular of the Company, which will be mailed to the shareholders of USHA prior to the Meeting.
About the Nicobat Nickel Property
The Nicobat Nickel Property is a nickel-copper-PGE project located in Dobie Township, Northwest Ontario 21 kilometres south of New Gold’s Rainy River Mine which hosts the Zone 34 nickel discovery.
Historic exploration work between 1952 and 1972 included over 15,000 metres of drilling, 220 drill holes and numerous bulk samples that identified a non-compliant historic resource of 5.3 Mt grading 0.24% Ni that contained a high-grade zone of approximately 225,000 tons grading 0.87% Ni.
Recent exploration work includes over 4,000 metres of drilling that has confirmed high-grade nickel-copper shoots do exist and are considerably better than previously recorded in the historical drilling, with drillhole A-04-15 intersecting from surface to approximately 63.75 metres a weighted average of 1.05% nickel and 2.18% copper that included an approximately 9.8-metre interval of 1.92% Ni from 53.95 to 63.75 metres.
The targeted feeder conduit measures approximately 305 metres by an average of 60 metres in width to a depth of 245 metres that is potentially open at depth and down-plunge to the north and is composed of cumulate textured olivine gabbro. This magma conduit sits in a larger norite body at the base of the Dobie Gabbro. The historical assessment data records high-grade “ribs”, one of which includes the zone described above. Future work will, therefore, focus on making the historic resource compliant current and expanding on the work completed to assess for other high-grade “ribs” and the potential high-grade feeder zone as shown in the model below.
Qualified person
The technical content of this news release has been reviewed and approved by Mr. Andrew Tims, P.Geo., a qualified person as defined by National Instrument 43-101.
About Usha Resources Ltd.
Usha Resources Ltd. is a North American mineral acquisition and exploration company focused on the development of quality battery and precious metal properties that are drill-ready with high-upside and expansion potential. Based in Vancouver, BC, Usha’s portfolio of strategic properties provides target-rich diversification and consist of Jackpot Lake, a lithium project in Nevada; Nicobat, a nickel‑copper‑cobalt project in Ontario; and Lost Basin, a gold-copper project in Arizona. Usha trades on the TSX Venture Exchange under the symbol USHA, the OTCQB Exchange under the symbol USHAF and the Frankfurt Stock Exchange under the symbol JO0.
USHA RESOURCES LTD.
“Deepak Varshney” CEO and Director
For more information, please call Tyler Muir, Investor Relations at (888) 772-2452, email tmuir@usharesources.com, or visit www.usharesources.com.