GUELPH, ON, Oct. 4 /CNW/ - ENPAR Technologies Inc. (TSX-V: ENP) ("ENPAR") is pleased to announce that it has entered into a definitive patent and technology license agreement (the "Agreement") with Dundarave Resources Inc. (TSX-V: DDX) ("Dundarave"). The Agreement provides Dundarave with an option to acquire an exclusive worldwide license to ENPAR's ExtrEL leaching technology and all related intellectual property as it relates to the recovery and extraction of nickel and associated by-products that are contained in nickel sulphide tailings. In order to exercise the option Dundarave must make capital expenditures of up to $3,200,000, grant a $5,000,000 royalty, and issue 8,000,000 common shares, each instalment of which shall be subject to a four month hold period, to be released as follows:
(a) 1,300,000 common shares upon the receipt of TSX Venture Exchange
approval in connection with the transaction;
(b) 1,700,000 common shares upon completion of an optimization and
design program (which will culminate in the design of the test
pilot plant) and the identification and acquisition of, or a
joint-venture involving, a suitable nickel sulphide tailings
deposit for on-site testing, each to the satisfaction of both
parties;
(c) 2,000,000 common shares upon completion of the construction of the
test pilot plant to the satisfaction of both parties; and
(d) subject to ENPAR first executing a license agreement or other
document, in a form reasonably satisfactory to Dundarave, for a
perpetual unencumbered, irrevocable grant of the licensed rights
to Dundarave (the "Irrevocable License"), 3,000,000 common shares
upon completion of the test pilot plant and the successful
recovery of a similar percentage of nickel from the sulphide
tailings so demonstrated during the optimization and design
program; provided, however, if such successful recovery of nickel
from sulphide tailings is not achieved within six months from the
completion of construction of the test pilot plant: (a) Dundarave
may, at its discretion, issue to ENPAR the 3,000,000 common shares
at any time up to 12 months from the completion of construction of
the test pilot plant subject to ENPAR providing the Irrevocable
License, and (b) the parties may conduct joint-research to improve
recoveries for a further six-month period, where agreed expenses
shall be shared on an equal basis between the parties.
The Agreement provides Dundarave with a right of first negotiation and refusal throughout the term of the Agreement and for a further period of 12 months thereafter in connection with the acquisition or sale, transfer, license or other form of disposition by ENPAR of any form of technology or related intellectual property used to recover and extract other metals.
As part of the Agreement, Dundarave will fund an optimization and design program and the full cost of the construction of the test pilot plant to process a significant amount of nickel tailings. The optimization and design program is expected to cost $200,000 and culminate in design plans for the test pilot plant. Construction of the test pilot plant is estimated to be $3,000,000 and any excess costs would result in a claw-back whereby the royalty owing to ENPAR would be reduced by the amount construction exceeds $3,000,000.
Subject to the claw-back, ENPAR will receive a royalty totaling $5,000,000 for the rights to the ExtrEL leaching system technology. This royalty will be paid by Dundarave by providing ENPAR with an annual maximum of 20% of the net annual profits earned by Dundarave from the sale of nickel produced by the test pilot plant using the technology.
As part of the Agreement, Dundarave will appoint Dr. Gene Shelp, President and CEO of ENPAR Technologies Inc. to its board of directors.
In connection with the transaction, ENPAR will pay a finder's fee to White Knight Capital of Toronto subject to the TSX Venture Exchange guidelines.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
ENPAR is a "Technology Company" applying its patented and proprietary "Electrochemical Technologies" to the treatment of waste water and drinking water contaminated by metals or nutrients i.e., nitrate/ammonia associated with the mining, metal processing, chemical, agricultural, municipal and waste management sectors. The common shares trade on Tier ll of the TSX Venture Exchange under the symbol "ENP".
This news release contains forward-looking statements within the meaning of the "safe harbour" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties and other factors that may cause ENPAR Technologies Inc. results to differ materially from expectations. These include risks relating to market fluctuations, property performance and other risks. These forward-looking statements speak only as of the date hereof.